Introduction

The respective treasurers of New South Wales, Queensland and The Australian Capital Territory delivered their budgets on 24 June 2025.

No major new tax or revenue measures were announced in the respective budgets. However, there are welcomed updates to address housing supply issues in New South Wales (such as extending the build-to-rent land tax concession and implementing a Pre-sale Finance Guarantee program), housing affordability measures in Queensland, and further announcements to The Australian Capital Territory’s continued tax reform program.

Key highlights from the respective budgets are detailed below.
 

New South Wales (“NSW”)

NSW remains in a budget deficit, which is expected to be $5.7 billion in 2024-25 and $3.4 billion in 2025-26. The NSW Budget is projected to return to a surplus of $1.1 billion in each of 2027-28 and 2028-29.

The NSW Budget is centered on sequencing reforms to maximise growth, focusing on coordinating the key sectors that empower NSW’s people and prosperity. These include housing, water, energy, transport, manufacturing and technology.

Notable measures from this year’s NSW Budget are set out below. It is expected that the NSW Government will implement amending legislation, and the Chief Commissioner will provide updated guidelines or a Revenue Ruling/Commissioner’s Practice Note on how taxpayers can seek relief under the announced build-to-rent tax concessions (and other announced) changes.
 

Build-to-Rent

Extending the build-to-rent land tax concession 

• Owners of new build-to-rent (“BTR”) developments are able to apply for a 50% reduction in land value for land tax purposes.[1]
• From the 2026 land tax year, this concession applies indefinitely (previously the concession was set to end 31 December 2039) subject to eligibility requirements. However, developments that are already receiving, or applied for, the BTR land tax concession for the 2025 land tax year or prior years are ineligible to receive the extended concession. [2]
• The requirement that a proportion of labour force hours for construction be performed by specified classes of workers will also be removed. [3]

Foreign Surcharge Duty and Land Tax Relief

• BTR developers will also be able to apply for exemptions from foreign purchaser duty and land tax surcharges (or a refund of surcharges paid).[4]
   

Pre-sale Finance Guarantee 

• In addition to the BTR measures addressed above to improve housing measures, the NSW Government has announced an Australian first Pre-sale Finance Guarantee program.[5]
• Currently, there are a large number of residential projects that have development approval but are unable to proceed to construction due to a shortfall in the pre-sales required to satisfy lenders' pre-condition to commence funding.
• Under the new Pre-sale Finance Guarantee program, the NSW Government will commit $1 billion to the purchase of off-the-plan dwellings in eligible residential developments to help developers secure lenders’ approval and commence construction sooner.[6]
• The Pre-sale Finance Guarantee program will be structured as a renounceable commitment to purchase nominated dwellings in eligible residential projects located in NSW. Essentially, the NSW Government will commit to the purchase of up to 50% of the dwellings in qualifying residential projects.[7]
• To qualify for the program, developers will need to pass through the NSW Government’s credit assessment process that will consider the merits of the project and the capacity, capability and credibility of the developer and their delivery team. Initial applications are expected to be accepted from October 2025.[8]
• The Pre-Sale Finance Guarantee program forecasts the delivery of up to 5,000 new homes over the next 5 years. [9]
   

Help to Buy Scheme

• Ahead of the NSW Budget, the Help to Buy (Commonwealth Powers) Act 2025 (NSW) was assented to by the NSW Parliament earlier this month on 11 June 2025.[10]
• The Help to Buy program will assist eligible low to middle income earners to purchase a home with a contribution from the Australian Government of up to 40% of the purchase price for new homes and 30% for existing homes. [11]
• Eligible NSW Help to Buy participants will be able to purchase property for up to $1.3 million in Sydney and regional centres and up to $800,000 in the rest of NSW, with a requirement that the home is the principal place of residence.[12]
   

Innovation and Emerging Technology

• The NSW Government announced the introduction of a critical minerals royalty deferral scheme to support new mining projects, attract additional investment to regional areas and support the development of an industry segment crucial to the energy transition.[13]
   

Payroll Tax

• No major payroll tax measures were announced in the NSW Budget. However, we have outlined below a number of key payroll tax-related revenue and expenditure items from the NSW Budget:
  • While payroll tax revenue is expected to reach $13.0 billion in 2024–25, the forward estimates to 2028–29 have been downgraded due to a weaker outlook for both employment and wages growth.[14]
  • Payroll tax exemptions to non-profit charitable institutions and to public hospitals, Local Health Districts and Ambulance Service of NSW remain within the top 3 tax expenditures for the State.[15]
  • The NSW Medical Centres (Bulk-Billing Support Initiative) is expected to cost the State $123 million in 2024–25 and $21 million in 2025–26. The reduction reflects the conclusion of the former, broader payroll tax exemption on 4 September 2024, as well as the targeted eligibility criteria, including bulk-billing thresholds required to access the rebate going forward.[16]
     

NSW Tax Integrity Program

• The NSW Government has agreed to extend the Revenue NSW funding which is supporting an increased level of tax compliance. This funding was previously forecast to decrease for 2025-26.[17]
   

Queensland

The Queensland Budget is focused on a ‘fresh start’ in delivering lower debt forecasts and improved fiscal results while fulfilling their promise of no new or increased taxes and investing a record amount in the infrastructure, health, housing and education budgets.

Queensland is on track to improve the State’s deficit with an operating deficit forecast of $8.6 billion in 2025-26, which is projected to decrease to $1.1 billion in 2028-29.[18] Queensland’s total revenue is budgeted to be $91,337 million in 2025-26, with a forward estimate of $102,457 million in 2028-29.[19] The corresponding total expenses is budgeted to be $99,918 million in 2025-26, with a forward estimate of $103,543 million in 2028-29.[20]

The Queensland Budget prioritises a plan to make the community safer by implementing stronger laws and greater resources to support the community, investing in generational infrastructure for the future, improving the quality and accessibility of health services, delivering better education and housing assistance for more Queenslanders.[21]

No major new tax measures were announced in the Queensland Budget.
 

Stamp Duty

Abolition of Stamp Duty for First Home Buyers of New Homes and Vacant Land

• Transfer duty will be removed for eligible first home buyers purchasing newly built homes or vacant land (on which to build a new home) from 1 May 2025.[22] This measure is estimated to cost $195 million over 5 years.[23]

Administrative Improvements to Processing of Ex Gratia Relief from Additional Acquirer Duty and Land Tax Foreign Surcharge

• Administrative changes will be implemented to improve the processing of applications for ex gratia relief from additional foreign acquirer duty (“AFAD”) and land tax foreign surcharge (“LTFS”). The aim is to provide greater certainty and timely consideration to applicants as current processing times may take in excess of a year.[24] This measure is estimated to cost $47 million over 4 years.[25]

Introduction of Windfall Duty and Windfall Tax

• The Revenue and Other Legislation Amendment Bill 2025 (Qld) was introduced into the Queensland Parliament on the day of release of the Queensland Budget. It provides for a 100% windfall gain tax in respect of refund claims for AFAD and LTFS where the basis of the claim arises from s.109 inconsistency under the Commonwealth Constitution. Relevantly, there are stamp duty and land tax matters before the High Court of Australia arguing inconsistency of foreign person surcharges with certain double tax treaties with overseas jurisdictions.
• If the taxpayers are successful in these matters, the intent of the new windfall gains tax measure is to overcome the State’s obligations to pay refunds. The new windfall gains taxing rules will apply retrospectively to broad circumstances including where a pre-existing objection is on foot and is still be determined by the Queensland Revenue Office. This is an unprecedented development in Queensland State Taxes, and it remains to be seen if other States will follow suit.
   

Land Tax

No other changes to land tax were announced in the Queensland Budget.
 

Payroll Tax

Payroll tax revenue in Queensland is estimated to total $6.819 billion in 2024-25, supported by strong labour market conditions. Revenue is forecast to grow by a further 7.3% in 2025-26, with average annual growth of 5.4% projected over the three years to 2028-29.

Reducing the cost of healthcare for Queenslanders

• The payroll tax exemption on payments by medical practices to general practitioners (GPs) is estimated to cost $538 million over five years to 2028–29. The exemption applies retrospectively from 1 December 2024, is not subject to the bulk-billing thresholds (as is the case for the NSW and VIC measures) and covers payments to both contracted and employee GPs.[26]

Extension of the apprentice and Trainee 50% payroll tax rebate

• The Queensland State Government is extending the 50% payroll tax rebate on wages paid to apprentices and trainees (already exempt from payroll tax) until 30 June 2026, at an estimated cost of $58.1 million in 2025-26.[27]
• The rebate is currently automatically calculated when Taxpayers enter their apprentice and trainee wages and lodge their return via the Queensland Revenue Office online portal.
   

The Australian Capital Territory (“ACT”)

The ACT 2025-26 Budget focused on its tax reform program, which is a multi-stage initiative aimed at improving the efficiency, equity, simplicity, and stability of the tax system. The tax reform is currently in stage 3 (2021-22 to 2025-26) with the objective of shifting from inefficient taxes, such as conveyance duty, to more stable and broad-based taxes like general rates.[28]

This Budget projects a Headline Net Operating Balance deficit of $424.9 million. This deficit is expected to improve over the forward estimates, with a return to a surplus of $47.9 million in 2027-28 and growing to $330.6 million in 2028-29.[29]
 

Stage 3

Under this ACT Budget’s announcements, the key measures of stage 3 (2021-22 to 2025-26) of the tax reform program include:

Reduction in Conveyance Duty

• The lowest marginal tax rate for home buyers has been reduced from 1.2% to 0.28%.
• The threshold for commercial duty has been increased from $1.5 million to $2 million.[30]

Motor Vehicle Duty

• From 1 September 2025, a minimum 2.5% duty will apply to zero-emission vehicles, with increasing rates based on emissions and value.
• An 8% duty will apply to vehicles valued above $80,000.[31]
   

Land Tax

• Land tax revenue is expected to grow due to increased demand for rental properties and higher unimproved land values (AUV). Foreign investors will continue to pay a 0.75% surcharge on the AUV of residential properties.[32]
• The Affordable Community Housing Land Tax has been expanded from 250 to 1,000 properties. The scheme makes rentals more affordable for people on low incomes and provides property owners a full land tax exemption if they rent their properties to eligible tenants through registered community housing provider at less than 75% of the market rent.[33]
   

Other Updates

• A new $250 Health Levy will be added to each rateable property (residential, commercial and rural) starting in 2025-26 to fund public hospitals and health services.[34]
• Property general rate increases:
  • Residential and commercial general rates will increase by 3.75% per annum during Stage 3 of the Tax Reform program (2021-22 to 2025-26).
  • Rural property rates will increase by 3.25% in 2025-26.
  • From 1 July 2026, a new land value threshold for non-units will apply to properties with an Average Unimproved Value (AUV) thresholds of over $1 million (high-value residential and commercial properties).[35]
• The residential and rural Police, Fire and Emergency Services Levy will increase by $30 in 2025-26 to $426. The Safer Families Levy will increase by $10 in 2025-26.[36]
• A new Short-Term Rental Accommodation Levy of 5% of gross revenue will apply starting in 2025-26.[37]
• The Ambulance Levy, which is payable by private health insurance companies, will increase by an additional 10% from 1 January 2026.[38]
• The Lifetime Care and Support Levy will increase from $105.40 to $110.40 in 2025-26.[39]
• The Road Safety Contribution Levy will increase from $2.50 to $3.20 in 2025-26.[40]
   

Stage 4

The key measures of stage 4 (2026-27) of the tax reform program include:
 

Payroll Tax

Payroll tax revenue is estimated at $818.6 million in 2024–25, representing a $36.7 million downward revision from the original Budget estimate. This reflects the ongoing impact of changes to Commonwealth employment practices. Over the four years to 2027–28, payroll tax revenue is now forecast to be $36.8 million (0.9%) lower than previously estimated, primarily due to the lower starting base in 2024–25. Nonetheless, labour market resilience and nominal wage growth are expected to support payroll tax revenue across the forward estimates.[41]

Broadening of the payroll tax base

• The ACT Government are seeking to broaden the payroll tax base by reducing the payroll tax threshold and the rate of tax for small to medium businesses from 1 July 2026. The measures include:
• Payroll tax-free threshold is reduced from $2 million to $1.75 million;
• Payroll tax rate for small to medium businesses with national wages between $1.75 million and $20 million will be taxed at 6.75%;
• Payroll tax rate for businesses with national wages between $20 million and $50 million will be taxed at 6.85%.
• Payroll tax rate for businesses with national wages between $50 million and $100 million will be taxed at 7.25%; and
• Payroll tax rate for businesses with national wages above $100 million will be taxed at 7.75%.[42]

Designated Medical Practices GP Wages Exemption 

• Whilst not announced in the Budget, a payroll tax measure which commences from 1 July 2025 is the exemption applicable to wages paid or payable to GPs for the provision of bulk-billed services. The exemption replaces the temporary amnesty, which applies up to 30 June 2025, for medical practices with contracted GPs.[43]
   

[1] New South Wales Budget 2025-26, Budget Paper No.1 – Budget Statement (Page 5-4).

[2] New South Wales Budget 2025-26, Budget Paper No.1 – Budget Statement (Page 5-4).

[3] New South Wales Budget 2025-26, Budget Paper No.1 – Budget Statement (Page 5-4).

[4] New South Wales Budget 2025-26, Budget Paper No.1 – Budget Statement (Page 5-4).

[5] New South Wales Budget 2025-26, Budget Paper No.1 – Budget Statement (Pages 3-4 and 7-5).

[6] The New South Wales Government, Policy and Legislation, Housing, “Pre-Sale Finance Guarantee”, https://www.planning.nsw.gov.au/policy-and-legislation/housing/pre-sale-finance-guarantee.

[7]The New South Wales Government, Policy and Legislation, Housing, “Pre-Sale Finance Guarantee”, https://www.planning.nsw.gov.au/policy-and-legislation/housing/pre-sale-finance-guarantee.

[8] The New South Wales Government, Policy and Legislation, Housing, “Pre-Sale Finance Guarantee”, https://www.planning.nsw.gov.au/policy-and-legislation/housing/pre-sale-finance-guarantee.

[9] The New South Wales Government, Policy and Legislation, Housing, “Pre-Sale Finance Guarantee”, https://www.planning.nsw.gov.au/policy-and-legislation/housing/pre-sale-finance-guarantee.

[10] Treasurer, Minister for Finance, Minister for Homelessness, Minister for Housing, Minister for Planning and Public Spaces, “NSW Ready for Help to Buy,” NSW Ministerial Media Release, May 30 2025, https://www.nsw.gov.au/departments-and-agencies/homes-nsw/news/nsw-ready-for-help-to-buy.

[11] Treasurer, Minister for Finance, Minister for Homelessness, Minister for Housing, Minister for Planning and Public Spaces, “NSW Ready for Help to Buy,” NSW Ministerial Media Release, May 30 2025, https://www.nsw.gov.au/departments-and-agencies/homes-nsw/news/nsw-ready-for-help-to-buy.

[12] Treasurer, Minister for Finance, Minister for Homelessness, Minister for Housing, Minister for Planning and Public Spaces, “NSW Ready for Help to Buy,” NSW Ministerial Media Release, May 30 2025, https://www.nsw.gov.au/departments-and-agencies/homes-nsw/news/nsw-ready-for-help-to-buy.

[13] New South Wales Budget 2025-26, Budget Paper No.1 – Budget Statement (Page 3-12).

[14] New South Wales Budget 2025-26, Budget Paper No.1 – Budget Statement (Page 5-6).

[15] New South Wales Budget 2025-26, Budget Paper No.1 – Budget Statement (Page C-4).

[16] New South Wales Budget 2025-26, Budget Paper No.1 – Budget Statement (Page C-11).

[17] New South Wales Budget 2025-26, Budget Paper No.1 – Budget Statement (Page 5-4).

[18] Queensland Budget 2025-26, Budget Paper 1 (Page 3).

[19] Queensland Budget 2025-26, Budget Paper 2 (Page 50).

[20] Queensland Budget 2025-26, Budget Paper 2 (Page 71).

[21] Queensland Budget 2025-26, Budget Overview (Page 9).

[22] Queensland Budget 2025-26, Budget Paper 4 (Page 128).

[23] Queensland Budget 2025-26, Budget Paper 4 (Page 128).

[24] Queensland Budget 2025-26, Budget Paper 2 (Pages 51-52).

[25] Queensland Budget 2025-26, Budget Paper 4 (Page 128).

[26] Queensland Budget 2025-26, Budget Paper 4 (Page 129).

[27] Queensland Budget 2025-26, Budget Paper 4 (Page 128).

[28] ACT Budget 2025 – 26, Budget Fiscal Strategy and Outlook (Page 36).

[29] ACT Budget 2025 – 26, Budget Fiscal Strategy and Outlook (Page 10).

[30] ACT Budget 2025 – 26, Budget Fiscal Strategy and Outlook (Page 36).

[31] ACT Budget 2025 – 26, Budget Fiscal Strategy and Outlook (Page 87).

[32] ACT Budget 2025 – 26, Budget Fiscal Strategy and Outlook (Page 174).

[33] ACT Budget 2025 – 26, Budget Fiscal Strategy and Outlook (Page 73).

[34] ACT Budget 2025 – 26, Budget Fiscal Strategy and Outlook (Page 86).

[35] ACT Budget 2025 – 26, Budget Fiscal Strategy and Outlook (Pages 154 to155).

[36] ACT Budget 2025 – 26, Budget Fiscal Strategy and Outlook (Page 155).

[37] ACT Budget 2025 – 26, Budget Fiscal Strategy and Outlook (Page 179).

[38] ACT Budget 2025 – 26, Budget Fiscal Strategy and Outlook (Page 86).

[39] ACT Budget 2025 – 26, Budget Fiscal Strategy and Outlook (Page 155).

[40] ACT Budget 2025 – 26, Budget Fiscal Strategy and Outlook (Page 155).

[41] ACT Budget 2025 – 26, Budget Fiscal Strategy and Outlook (Page 170).

[42] ACT Budget 2025 – 26, Budget Fiscal Strategy and Outlook (Page 87).

[43] Payroll Tax, “Designated Medical Practices with General Practitioners,” The ACT Revenue Office, https://www.revenue.act.gov.au/payroll-tax?result_1060955_result_page=9#:~:text=Medical%20practices%20that%20register%20for,up%20until%2030%20June%202025.