South Australian budget measures update - South Australia introduces a bank levy
A new bank levy, land tax exemptions and changes to stamp duty are the key announcements in the SA Budget.
The South Australian budget was handed down on 22 June 2017 under the Budget Measures Bill 2017, which is currently being debated in the South Australian Parliament.
The budget key announcements are:
- A stamp duty surcharge calculated at 4% will be imposed on instruments under which an interest in residential land is acquired by a foreign person or trustee of a foreign trust.
- The off-the-plan stamp duty concession will be extended to 30 June 2018 and will not apply to foreign purchasers.
- An off-the-plan apartment grant of $10,000 is available to purchasers from 22 June 2017 to 30 September 2017.
- Land is exempted from land tax for five years if the owner of the land acquired it under a qualifying off-the-plan contract that was entered into between 22 June 2017 and 30 June 2018.
- From 1 July 2017 the payroll tax rate will be progressive so that the rate is now between 2.5% and 4.95%.
- From 1 July 2017, a new major bank levy will be introduced. Authorised deposit-taking institutions (ADI) operating in South Australia which are required to pay the Commonwealth major bank levy will also need to pay the South Australian major bank levy. This levy will apply at 0.015% of South Australia's share (currently determined at 6.06%) of the total value of bank liabilities subject to the Commonwealth major bank levy at the end of each quarter. This levy is not to be recovered from customers of the ADI and must be paid out of the profits or other funds of the ADI.
Reduction in the rate of duty on dealings in non-residential, non-primary production land
In addition to the above, from 1 July 2017 the rate of duty on duty on dealings in non-residential, non-primary production land (defined in the Stamp Duties Act 1923 (SA) as "Qualifying Land") will be reduced by a further one-third reduction (being a total reduction of two-thirds).
Stamp duty on transfers of non-residential, non-primary production land will be abolished from 1 July 2018.
20 November 2017 update: The bank levy announced in the budget has been abandoned. In response the Treasurer has announced that the stamp duty surcharge on foreign buyers of residential property will be increased to 7%.
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Senior Associate • Sydney
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