Stamp duty axed as budget tackles housing crisis
First home buyers in the ACT will no longer have to pay stamp duty, the territory government has announced as it hands over a debt-ridden budget.
Housing is at the center of Finance Minister Chris Steel’s second budget, due on Wednesday.
The latest milestone in ACT Labor’s long-term project to scrap stamp duty in favor of higher property rates will see the exemption extended to all first home buyers from July 1.
Currently, only homes under $1 million are exempt, and buyers must be below income eligibility thresholds.
The ACT will be the first jurisdiction in Australia to completely abolish stamp duty for people entering the property market.
“The removal of stamp duty for first home buyers compliments the federal government’s tax reforms, which are supporting a younger generation of Canberrans to own their own home,” Mr Steel said.
Stamp duty will also be exempt for pensioners, some National Disability Insurance Scheme beneficiaries and people who have not owned a property for five years.
It complements a range of policies aimed at increasing housing supply and home ownership.
Mr Steel said the temporary reduction in the ACT lease change fee charged to developers for the increase in value resulting from building approval would reduce overall development costs and encourage builders to bring more projects forward.
Recent “missing middle” reforms have allowed more low-rise housing, such as terraces and townhouses, to be built across large parts of Canberra, with the aim of increasing supply by 30,000 new homes by the end of 2030.
ACT will also follow NSW in introducing a model book of pre-approved plans that will allow builders to access faster approvals if they use the designs.
“Together, these reforms open the door for more renters to own property, support young households to build their futures in Canberra and ensure our tax system works better for the next generation,” Premier Andrew Barr said.
The cost of the extended stamp duty exemption has not yet been announced.
In his mid-year budget update in February, the treasurer predicted the ACT deficit would fall from $499 million this financial year to $80 million in 2026/27.
However, it is estimated that the region’s net debt will increase from 11 billion dollars to 12.8 billion dollars.
Much of the region’s infrastructure pipeline has been shelved in the search for savings.
The new Northside Hospital will set the budget back by $1.3 billion over seven years and has been identified by the government as the top infrastructure priority for the rest of the decade.
It leaves other projects, such as the light rail extension to Woden, up in the air.
While the budget includes $15 million for some lighting and lifting upgrades at GIO Stadium, soccer fans may be waiting a while longer for the long-promised new arena.
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