Thursday, September 7, 2017
The Western Australian Government has said that it will introduce a four percent foreign buyers surcharge, following the announcement of similar measures in other states.
The surcharge will apply from January 1, 2019. It will apply at a rate of four percent on all purchases of residential property in Western Australia by overseas buyers, including individuals, corporations, and trusts. It will be payable in addition to the normal transfer duty on property purchases.
The charge will be restricted to residential property. It will not apply to purchases of commercial or industrial property, residential developments of 10 or more properties, commercial residential property, or mixed-use properties that are used primarily for commercial purposes.
The state Government said that the 2019 implementation date will allow the market to adjust.
The Government estimates that the surcharge will raise AUD21m (USD16.8m) in its first full year (2019-20), and a total of AUD49m over the forward estimates period to 2020-2021. It said the revenue raised will pay for a freeze on fees for vocational education courses, and help repair the budget.
New South Wales, Victoria, and Queensland currently apply a surcharge on foreign buyers. South Australia will follow suit from January 1, 2018. The proposed Western Australian rate of four percent is in line with that to be introduced in South Australia, and is lower than the rates applied in New South Wales and Victoria.
Treasurer Ben Wyatt said: "This new revenue base will help put the budget on a more sustainable footing. Introducing the Foreign Buyers Surcharge is a smart and responsible decision. We are bringing WA into line with other states and guaranteeing a new ongoing revenue source for years to come."