Queensland boosts tax breaks for foreign property investors

Queensland’s LNP government will expand tax breaks for foreign housing investors in an attempt to boost construction, less than a week after introducing draft laws to allow developers to make political donations in state elections.

Treasurer David Janetzki announced the changes in a mid-financial year budget update on Monday, which showed the state’s operating balance fell almost $400 million further into deficit since his government’s first budget in June.

Janetzki said the changes would expand eligibility – and speed up processing times – for foreign property investors who apply for exemptions to extra stamp duty and land tax charges.

The changes, said to have been mooted by a re-established government property committee, will take effect from Monday and include lowering the number of homes needed to be built to qualify for an exemption from 50 to 20.

The eligibility of corporate groups and other entities used in property development will also be expanded.

“We are ensuring Queensland remains a competitive and attractive destination for development and investment through delivering a clear message that Queensland is open for business,” Janetzki said in a statement.

“The Crisafulli government is continuing to take action that will increase housing supply to deliver more homes for Queenslanders.”

Janetzki told reporters he had not modelled, or accounted for, the potential extra lost tax revenue beyond the $47 million in June’s budget.

“I’ll wait and see – see the early indications. And if there is a need for change I’ll deal with that in the [next] budget,” he said.

In comments included in the government media release, Property Council of Australia state executive director Jess Caire said the foreign tax scheme had led Queensland to miss out on almost 32,000 homes worth $17.8 billion since its inception in 2016.

“Most alarmingly, the international taxpayers that have borne the brunt of these taxes are not foreign buyers looking to crowd Queenslanders out of housing but are in fact Australian-based developers and owners who build the houses Queensland needs,” she said.

On Sunday, the government also announced a doubling of its “boost to buy” shared equity scheme to $330 million – or 2000 aspiring homebuyers seeking up to a 30 per cent equity contribution from the state.

The downgraded budget outlook is largely the result of $345 million in extra concessions given this financial year to public sector workers beyond the state wage offer on a number of bargaining fronts, including nurses and police.

Additional new spending pushing the government’s balance sheet down by $478 million also include industry support in the state’s north-west, racing infrastructure and the inquiry into the CFMEU and construction sector misconduct.

The now-forecast net operating deficit of $8.96 billion in 2025-26, up from the $8.58 billion projected in the budget, has been offset partially by a 2.1 per cent uptick in tax revenue this financial year, and more in the years ahead.

Transfer duty on property sales has been the main driver of this, based on skyrocketing property prices, the budget update said.

Higher than previously forecast inflation and wages growth, leading to higher payroll tax projections, has led the government to lift its expected tax take over the three years to 2028-29 by $1.08 billion, or 1.2 per cent.

While still $2.3 billion lower than last financial year, amid repeated criticism from the state government, Queensland’s 2025-26 GST revenue has been revised up $177 million, or 1.1 per cent.

Total government debt forecasts are now expected to be slightly lower than in the budget by 2029, falling from $205.6 billion to $204.9 billion, compared with $146.9 billion this financial year.

Net debt is now expected to end the financial year at $87.7 billion, down from the budget-forecast $90.3 billion.

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