Queensland’s newly announced stamp duty hike for foreign investors has been labelled a broken promise by a prominent real estate lobby group.
Queensland Treasurer Curtis Pitt last week announced that foreign buyers of residential real estate in the state will soon face an additional 3% stamp duty surcharge, following in the footsteps of the Victorian and New South Wales governments who have made similar announcements.
In announcing the increase Pitt said it will not deter foreign investors from targeting the Queensland property market, but Chris Mountford, Queensland executive director of the Property Council of Australia, said the Queensland government has sacrificed any advantage its real estate had in the search for revenue.
“The Treasurer has previously committed to making Queensland the most attractive state for foreign investment, now he is looking to abandon this competitive advantage in the search for more revenue,” Mountford said.
“At a time when the Queensland Government's resource revenue is being drastically written-down, trying to recoup losses from one of the few sectors of the Queensland economy that is currently generating jobs is short-sighted,” he said.
In criticising the government’s move, Mountford pointed to a statement made in 2015 by Pitt in which he said the current government would not move to milk revenue from foreign investors.
“In the lead up to the election we made it very clear that we wanted to provide certainty to businesses and investors, and that we would not be changing the existing revenue policy settings this term of government,” Pitt said in a government statement on 6 May 2015.
“Therefore, we're ruling out any stamp duty surcharges for foreign investors who purchase a house in Queensland,” Pitt said.
The stamp duty increase was criticised on announcement by the Real Estate Institute of Queensland, who believes it could have serious repercussions for the apartment market in the state and Mountford said the move could prevent future projects from ever being started.
“Our residential development cycle has reached its peak. The Treasurer's actions are likely to intensify the market's cooling process, impacting construction work and ultimately jobs over the next 12 months and beyond.
“Foreign investors enable new residential projects to get off the ground, creating a huge economic benefit for the state and producing new stock that puts downward pressure on rents and keeps housing affordable for Queensland families."
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