Labor will slash costs for foreign investors building homes in Victoria and review levies on overseas developers, as part of a renewed effort to roll back property taxes that industry chiefs have warned are holding back the state from meeting its housing targets.
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chiefs → slash → targets
But the tax cuts will further eat into revenue as the state government battles to gain control of the budget and ballooning debt, with falling property prices already slashing its expected collection of stamp duty revenue.
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prices → eat → revenue
Treasurer Colin Brooks on Wednesday announced the government would cut the absentee owner surcharge, an additional land tax levied on overseas developers that was introduced in 2015 and doubled in 2023, for residential projects and developments that fit Labor’s priorities.
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that → announce → priorities
Overseas developers would be exempt from the tax during construction if their projects meet the criteria for the Development Facilitation Program – a fast-track approval system which applies to significant residential projects, and those that unlock strategic packages of land or build energy-efficient medium-density housing.
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that → meet → housing
Brooks promised an independent review of the tax and the foreign purchaser additional duty – an extra stamp duty impost on foreign investors – if Labor is re-elected in November.
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Labor → promise → November
The review would examine whether the taxes are collected efficiently, how it affects foreign investment and the impact on first home buyers.
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it → examine → buyers
Fast-tracking the approval of new home builds has become a political priority for Labor, which in 2023 promised to build 800,000 homes in a decade.
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which → track → decade
The government has already fallen 55,000 homes behind its target, with property groups blaming prohibitive taxes and red tape.
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groups → fall → taxes
Brooks acknowledged that although more homes were built in Victorian than any other state, “there’s more to do”.
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homes → acknowledge → state
He said Labor had improved the planning system for developers but acknowledged a “more competitive tax setting here in Victoria” was needed.
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setting → say → Victoria
“First home buyers are Labor’s priority – we want to make sure that the supply is there so that they can get a home,” Brooks said.
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Brooks → want → home
“This will be a comprehensive review to make sure the settings are right for Victoria to continue to lead the nation.”
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Victoria → make → nation
Brooks made the announcements at an event hosted by the Property Council, an industry group representing the sector.
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Brooks → make → sector
The government moved earlier this month to reverse a major Daniel Andrews-era policy to ratchet up land tax on the owners of second homes and investment properties.
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government → move → homes
The council has warned global investment in the Victorian property sector dropped from $10 billion to $5 billion in the three years to late 2025.
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investment → warn → 2025
The group’s state executive director, Cath Evans, said on Wednesday that slashing the absentee owner surcharge would deliver a major boost to the economy, but Labor needed to do more.
“Anything that helps open the door to more capital coming into Victoria is important,” she said.
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she → say → Victoria
“We need that investment to build the homes, workplaces and infrastructure our state urgently needs.”
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state → need → homes
Opposition housing spokesman David Southwick told attendees at the Property Council event that Labor had introduced 40 new taxes on the industry.
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Labor → tell → industry
“You … have been squeezed like a lemon, so there’s no juice left, simply to prop up a budget,” he said.
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he → squeeze → budget
A Business Council of Australia report, released late last year, ranked Victoria as the nation’s worst state for doing business, in part due to the high rate and wide scale of property taxes.
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report → release → taxes
The Coalition is promising, if elected, to exempt first home buyers from stamp duty on properties worth up to $1 million, lift the land tax threshold to $300,000 at a rate faster than Labor, scrap the emergency services levy on residential homes, and wind back taxes on short-stay accommodation.
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Coalition → promise → accommodation
Brooks said the Coalition’s plan to further cut property taxes while also making savings across other parts of the budget did not fit with the economic reality.
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plan → say → reality
“A five-year-old can tell you that this doesn’t add up.
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this → tell → you
It’s not a budget it’s like something from Narnia,” he said.
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he → ’ → Narnia
Brooks indicated a further willingness to cut taxes, but said his immediate priority was “to deliver fiscal discipline”.
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priority → indicate → discipline
The pledge to remove the absentee owner surcharge for some developments raises fresh questions about how the government will address state debt, which is soaring towards $200 billion by 2030.
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which → remove → 2030
The government in 2024-25 raked in $457.83 million from the surcharge.
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government → rake → surcharge
Falling house prices are already threatening to wipe off as much as $1.8 billion in stamp duty revenue from the state budget this year.
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prices → fall → budget
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popularity → gain → dive
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Liberals → dump → election
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Start the day with a summary of the day’s most important and interesting stories, analysis and insights.
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it → hit → stories
The Aporia
