Stamp duty will be waived or reduced in one Australian city to boost the construction industry – but you’d better be quick
- The ACT will waive or reduce stamp duty to kickstart the construction industry
- Stamp duty is a tax paid to the state government when a home buyer buys house
- For 12 months from June 4, the ACT Government will reduce or waive the tax
- Apartments, townhouses and residential land worth $500K won’t require duty
- Properties and land valued from $500K to $750K will have duty cut by $11,400
The ACT Government has announced it will waive or reduce stamp duty on new land and off-the-plan apartments to help boost the struggling construction industry.
For 12 months from June 4, Canberrans who buy off-the-plan apartments and townhouses and single residential blocks of new land up worth up to $500,000 will not have to pay stamp duty.
Stamp duty on properties and land priced between $500,000 and $750,000 will be cut by $11,400.
Aerial drone view of new housing development and construction in the newly established suburb of Strathnairn at Ginninderry in Canberra
Stamp duty is a lump-sum tax paid to the state government when a home buyer purchases a property (stock)
The plan will run up until June 30, 2021.
Chief Minister Andrew Barr welcomed the scheme which will see job growth and an opportunity for first home buyers.
‘[It] will suit downsizers. It will also suit young families who need a bigger house because they’ve got a new baby,’ he said,.
‘I think there is some pent-up demand from people who own units and townhouses who might want to move into a freestanding home and to buy a block of land and build their own house.’
The Master Builders Association of the ACT also welcomed the plan, saying the coronavirus pandemic had been devastating for the construction industry.
‘This is going to add a whole lot of confidence into the ACT housing sector right when it needs it,’ ACT chief executive Michael Hopkins told ABC News.
The initiative begins a day after the federal government unveiled its HomeBuilder scheme, which provides $25,000 grants for renovations and new home builds.
Off-the-plan apartments and townhouses as well as single residential blocks of new land up worth up to $500,000 will not have to pay stamp duty (stock)
Australians can get the cash sent directly to their bank accounts from Thursday under the scheme designed to rescue the country from its first recession in 29 years.
The grants are available for renovation works that cost between $150,000 and $750,000 and for new homes valued at less than $750,000.
Renovations must improve the ‘livibility’ of the home, meaning swimming pools, tennis courts, outdoor spas and saunas, and detached sheds or garages do not count.
The house being renovated must not be valued at more than $1.5million and must be the applicant’s primary residence, meaning investment properties do not qualify.
To get the cash, applicants must earn less than $125,000 or be in a couple earning less than $200,000.
The applicant must pay a licensed builder the first installment for starting work and then can apply to their state or territory revenue office for the $25,000.
After checking all the criteria is met, officials will transfer the cash directly into the applicant’s chosen bank account.
In total, the policy is expected to cost $688million and provide work for 140,000 tradies and another 1million workers in the supply chain.
The scheme lasts from 4 June 2020 until 31 December 2020.
Scott Morrison (pictured in Eden-Monaro) has announced an extraordinary scheme to give $25,000 cash grants for renovations