Australia: Tax measures in 2021-2022 budget (New South Wales)

Tax measures in New South Wales 2021-2022 budget

Tax measures in New South Wales 2021-2022 budget

The New South Wales budget for 2021-2022 proposes property tax reform and electric vehicle reform measures.

In November 2020, the New South Wales government released a consultation paper that proposed a phased approach to transition away from the current stamp duty and land tax, with one aim being to boost home ownership. The “Property Tax Progress Paper” (outlining the findings from the consultation) was released 10 June 2021. Work is ongoing with regard to certain substantive features, and the final consultation period ending 31 July 2021 is seeking feedback on the proposed framework including rate structures, protections, and choice. There has been a close consultation with the federal government to determine that productivity reforms are not adversely impacted by the potential to reduce the state’s share of goods and services tax (GST) revenues. Finalisation of these discussions will be crucial for all states’ and territories’ ability to fund major productivity reforms.

Under the budget, from 1 September 2021, electric vehicles (EV) and hydrogen fuel cell vehicles (FCEVs) under $78,000* will be exempt from motor vehicle duty. Furthermore, the government will make available a rebate of $3,000 for the first 25,000 purchases of new battery and FCEVs priced below $68,750. The government plans to introduce a road user charge of 2.5 cents per km to commence from the earlier of 1 July 2027 or the time when EVs make up 30% of all new vehicle sales, whichever comes first.

The New South Wales government on 22 June 2021 introduced a bill to change how it taxes property value “uplift” that results from the government’s infrastructure spending or rezoning of land. The proposed change would see certain property developers paying the additional levy following approval of their projects.

Read a June 2021 report [PDF 319 KB] prepared by the KPMG member firm in Australia

*$=Australian dollar

 

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