Land tax increases for companies and trusts have been announced as part of the 2019/2020 Queensland State Budget.

In changes set to take place from June 30, land tax for companies and trusts are set to increase by 0.25 per cent, while the absentee surcharge will rise from 1.5 per cent to 2 per cent.

There will also be a new land tax foreign surcharge of 2 per cent for foreign companies and trustees of foreign trusts that own land.

There will be no changes to individual land tax.

In her budget speech, Queensland Treasurer Jackie Trad said the federal government's changes to the distribution of GST revenue had contributed to the changes.

"Queensland’s share of the GST has been slashed by $866 million as a direct result of interference by Canberra," she said.

"As a result of Canberra’s cuts, there will be an increase in land tax rates for companies and trusts of 0.25 per cent."

2019/2020 Queensland State Budget - At a glance

• There will be a new land tax foreign surcharge of 2 per cent for foreign companies and trustees of foreign trusts that own land.
• Land taxes for companies and trusts are set to increase by 0.25 per cent from July 30 to cover "Canberra cuts" to GST revenue.
• There will be no changes to individual land tax.

Real estate sector 'ignored'

The Real Estate Institute of Queensland has criticised the state government for a budget it says offers little help to the "fragile" real estate sector.

REIQ CEO Antonia Mercorella said there should have been measures to address the state's softening real estate market.

"We have been advocating long and hard for measures that would help young Queenslanders get their foot on the first rung of the property ladder, such as broadening the First Home Owners Grant to include established homes," she said.

“Not everyone wants to build their first home and in regional Queensland particularly, there are homes that are already built that are cheaper than building new.

"The grant could help those people into their first property."

Brisbane LGA median house price growth has softened to 1.5 per cent in the latest median house price figures,

Ms Mercorella said a significant issue facing the Queensland property sector was the lengthening hold periods as people stayed in their homes longer, slowing turnover and stifling mobility. 

“Stamp duty is a significant impost and adds, often, tens of thousands of dollars to the cost of the move," she said.

"We’ve been advocating for a discount for older Queenslanders who are continuing to live in the family home long after it is fit for purpose. 

“Encouraging these Queenslanders to 'right-size' their principal place of residence will free up significant levels of stock and enable a young family to up-size their family home,” she said. 

Ms Mercorella said the challenges facing the property sector were not easy to solve, but a lack of confidence is a key theme throughout the issue. 

“We need all levels of government to think more creatively about the problems facing the real estate sector and tackle the issues in an innovative way," she said.

Click here to view the 2019/2020 Queensland State Budget papers.

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