Statutes Amendment (Budget Measures) Bill

Standing Orders Suspension

The Hon. S.C. MULLIGHAN (Lee—Treasurer) (15:42): I move:

That standing orders be so far suspended as to enable the introduction of the Statutes Amendment (Budget Measures) Bill.

The SPEAKER: An absolute majority being present, I accept the motion.

Motion carried.

Introduction and First Reading

The Hon. S.C. MULLIGHAN (Lee—Treasurer) (15:42): Obtained leave and introduced a bill for an act to amend the Emergency Services Funding Act 1998, the First Home and Housing Construction Grants Act 2000, the Land Tax Act 1936 and the Stamp Duties Act 1923. Read a first time.

Second Reading

The Hon. S.C. MULLIGHAN (Lee—Treasurer) (15:43): I move:

That this bill be now read a second time.

I seek leave to have the second reading explanation and explanation of clauses inserted in Hansard without my reading them.

Leave granted.

The 2023-24 Budget is focussed on the government's priorities of a sustainable, efficient health system, more affordable housing, assistance towards cost of living pressures, and providing better public services for South Australians.

The Bill contains amendments to relevant legislation to implement measures announced in the 2023-24 Budget and other administrative amendments, including:

As part of the government's plan for A Better Housing Future, introducing a 50 per cent land tax discount for eligible new build-to-rent residential construction projects. The discount will reduce the land value for land tax purposes by 50 per cent to the 2039-40 land tax year for eligible projects;

Providing stamp duty relief for eligible first home buyers on the purchase of new homes valued up to $650,000 and a corresponding increase to the First Home Owner Grant property value cap; and

Various administrative amendments relating to the Emergency Services Levy.

Mr Speaker, I turn now to a more specific discussion of the detail of these important amendments.

Emergency Services Funding Act 1998

The Bill makes various amendments to the Emergency Services Funding Act 1998.

Amendments are being made to allow the Commissioner of State Taxation to collect the Emergency Services Levy (ESL) from either a landowner and/or a private shack lessee.

Currently, lessees of private shack sites are not specifically provided for as an 'owner' from which ESL can be collected, and Notices of Emergency Services Levy Assessments are issued to the lessors as the owners of the land.

Owners of some privately leased shack site groups have requested that RevenueSA send separate ESL Notices to the lessees of the shack sites, as the responsibility of collecting the ESL from lessees can be burdensome.

Following the changes, owners of privately leased shack sites could request the Commissioner of State Taxation to issue individual ESL bills to lessees, relieving the owner of the administrative difficulties of apportioning, collecting and paying the ESL for their shack group;

An amendment is also being made to change references to Volunteer Marine Rescue SA Incorporated to a Volunteer Marine Rescue Organisation accredited by the State Marine Rescue Committee to be more in line with current marine rescue arrangements.

First Home and Housing Construction Grants Act 2000

The Bill also amends the First Home and Housing Construction Grants Act 2000 to increase the property value cap for eligibility for the $15,000 First Home Owner Grant from $575,000 to $650,000.

When combined with the new stamp duty relief, an eligible first home buyer could now receive total relief of up to $44,580 on the purchase of a new home valued at $650,000.

Land Tax Act 1936

This Bill introduces a 50 per cent land tax discount for eligible new build-to-rent properties. The discount reduces the land value of the parcel of land being used as an eligible build-to-rent property by 50 per cent until the 2039-40 land tax year.

The criteria for an eligible build-to-rent property includes that a minimum lease term of at least three years must be offered to tenants to support more secure tenure arrangements. Further requirements to be deemed an eligible build-to-rent property can be outlined in regulations, including but not limited to the minimum number of build-to-rent dwellings or units within a property and requirements to support the development of new affordable housing in build-to-rent properties.

Build-to-rent projects where construction commences from 1 July 2023 will be able to apply for relief.

The reduction in land tax for eligible build-to-rent properties is designed to support the uptake of investment in residential rental housing, increasing the supply of housing and creating more opportunities for renters.

The amendments are largely consistent with those included as part of the Statutes Amendment (Budget Measures 2021) Bill 2021 but ultimately not passed by Parliament at that time.

Stamp Duties Act 1923

This Bill provides stamp duty relief for eligible first home buyers who enter into a contract to purchase a new home or vacant land to build a new home, on or after 15 June 2023.

No stamp duty will be payable on the purchase of an eligible new home valued up to $650,000 with relief progressively phasing out for properties valued up to $700,000.

For the purchase of vacant land on which a new home will be built, no stamp duty will be payable for vacant land valued up to $400,000 with relief phasing out for land valued up to $450,000.

To be eligible for relief, the new home must be occupied as the principal place of residence, similar to existing requirements for the First Home Owner Grant, under the First Home and Housing Construction Grants Act 2000.

Stamp duty relief of up to $29,580 will be available for eligible applicants under this measure.

Mr Speaker, the 2023-24 Budget is a responsible budget focused on strengthening our health system, increasing the supply of affordable and appropriate housing, and alleviating cost of living pressures. The measures contained in this Bill support the objectives of this government to ensure South Australia remains an attractive place to live, work and do business.

I commend this Bill to the House.

Explanation of Clauses

Part 1—Preliminary

1—Short title

2—Commencement

These clauses are formal.

Part 2—Amendment of Emergency Services Funding Act 1998

3—Amendment of section 3—Interpretation

This clause updates a reference in the definition of emergency service and amends the definition of owner to include a person who is entitled to the right of occupation of a River Murray shack lease.

4—Amendment of section 28—The Community Emergency Services Fund

This clause updates a reference in section 28(4)(a)(v).

Part 3—Amendment of First Home and Housing Construction Grants Act 2000

5—Amendment of section 7—Entitlement to grant

This clause amends section 7 of the First Home and Housing Construction Grants Act 2000 so that no first home owner grant is payable where the market value of the relevant home exceeds $650,000. Currently, the grant is not payable if the market value exceeds $575,000.

Part 4—Amendment of Land Tax Act 1936

6—Insertion of section 7A

This clause inserts a new provision in the Land Tax Act 1936 allowing for a 50% reduction in the taxable value of land (from 1 July 2023) where the Commissioner is satisfied that a building constructed on the land on and after 1 July 2023 is being used and occupied for a build-to-rent property in accordance with the provision. The provision will expire immediately before midnight on 30 June 2040.

Part 5—Amendment of Stamp Duties Act 1923

7—Insertion of sections 71DD and 71DE

This clause inserts two new sections.

71DD—Relief from duty in respect of certain purchases of new homes and land

Proposed section 71DD applies to a conveyance or transfer if the Commissioner of State Taxation is satisfied that—

an applicant for relief under the section is a purchaser under a contract for the conveyance or transfer of a new home or vacant land on which a home is to be built; and

the conveyance or transfer qualifies for relief under the section.

If section 71DD applies to a conveyance or transfer, the duty payable on the conveyance or transfer is as follows:

if it is a conveyance or transfer of a new home and the market value of the home (including the land on which the home is situated) when the contract is entered into does not exceed $650,000—no duty is payable;

if it is a conveyance or transfer of a new home and the market value of the home when the contract is entered into exceeds $650,000 but does not exceed $700,000—the duty otherwise payable will be reduced in accordance with other provisions of the section;

if it is a conveyance or transfer of vacant land and the market value of the land when the contract is entered into does not exceed $400,000—no duty is payable;

if it is a conveyance or transfer of vacant land and the market value of the land when the contract is entered into exceeds $400,000 but does not exceed $450,000—the duty otherwise payable will be reduced in accordance with other provisions of the section.

A conveyance or transfer qualifies for relief if—

the contract for the conveyance or transfer was entered into on or after 15 June 2023; and

the purchasers under the contract are at least 18 years of age (but this requirement operates subject to other provisions of the section); and

at least 1 of the purchasers under the contract is an Australian citizen or permanent resident at the time application is made; and

no purchaser under the contract, and no spouse or domestic partner of a purchaser under the contract, has—

been a party to an earlier conveyance or transfer for which no duty, or a reduced rate of duty, was payable under the section; or

before the commencement date of the contract, held a relevant interest in residential property in South Australia or another State and occupied the property as a place of residence for a continuous period of at least 6 months; and

the market value of the new home or vacant land when the contract is entered into does not exceed—

in the case of a new home—$700,000; and

in the case of vacant land on which a home is to be built—$450,000.

Subsection (4) of the new section imposes a requirement for purchasers to occupy a home on the land that is conveyed or transferred, including where the land that was vacant at the time of the relevant conveyance or transfer. Occupation must be for a continuous period of at least 6 months. For a new home, the period of occupation must commence within 12 months of the date on which the conveyance or transfer occurs. For vacant land, occupation must commence before the date falling 12 months after the date on which the purchaser was lawfully first able to use a home constructed on the land as a place of residence or, if this occurs earlier, before the date that is 36 months after the date on which the conveyance or transfer occurred. The Commissioner may vary a residence requirement or, in certain specified circumstances, determine that a conveyance or transfer qualifies for relief even though a purchaser has not satisfied the residence requirement. The Commissioner may also determine that a conveyance or transfer qualifies for relief despite a purchaser under the contract not being at least 18 years of age provided that the Commissioner is satisfied that the residence requirement will be satisfied. The Commissioner must also be satisfied that the application does not form part of a scheme to circumvent limitations on, or requirements affecting, eligibility or entitlement to relief.

An application can only be made by a natural person and must be made jointly by each person who will be an owner of the new home or land to which the application relates.

71DE—Duty payable if relief ceases to be available

This proposed section provides for the payment of duty at full rates where section 71DD ceases to apply to a conveyance or transfer because the Commissioner ceases to be satisfied that the section applies or there is a failure to comply with the residence requirement.

8—Amendment of Schedule 2—Stamp duties and exemptions

This clause deletes a redundant note from Schedule 2.

Debate adjourned on motion of Hon. J.A.W. Gardner.