New South Wales Tax: NSW stamp duty cut to zero for some
The over 65s and those buying homes off the plan will benefit from the country's first zero per cent stamp duty, under the NSW government's latest budget showing the state back in the black two years earlier than expected.
Treasurer Eric Roozendaal has announced a surplus of $101 million for the 2009/10 financial year - a massive turnaround from the deficit expected a year ago - as the government issued its final budget ahead of the 2011 state election.
Surpluses are also forecast out to 2013-14, making the effects of the global financial crisis a minor blip in the state's economic history.
For 2010/11 a surplus of $773 million is expected, ahead of $885 million in 2011/12 and $863 million in 2012/13.
In the previous budget, the government had expected deficits out to 2010/11, including a deficit of $990 million for 2009/10.
In the 2010/11 budget handed down on Tuesday, Mr Roozendaal said the state had weathered the global financial crisis better than expected and would now focus on consolidating the economic recovery.
"The beacon of hope I talked about last year has lit the path to prosperity," he told parliament in his budget speech.
"Today, I proudly announced NSW is ... already back in the black.
"The budget result for this year represents a $1.1 billion turnaround - and over the next four years, budget surpluses will be worth a total of $3.15 billion."
The headline announcement of the budget was stamp duty cuts totalling $140 million, including the country's first zero per cent tax, for off-the-plan purchases worth up to $600,000.
Under the two-year plan, beginning July 1 this year, those purchasing properties off-the-plan will pay no stamp duty, a saving worth up to $22,490 each, Mr Roozendaal said.
The over-65s will also get a stamp duty exemption for the same period, to help them downsize to a new home.
"This will apply to people over 65 who sell their primary place of residence and move to a newly-constructed home - whether it is house or an apartment," Mr Roozendaal said.
A 25 per cent stamp duty cut will also apply to those buying a home worth up to $600,000 which is under construction or just completed.
Mr Roozendaal said the measures were aimed at boosting housing supply and housing construction rates across the state.
"A key driver of economic growth," he said.
Business is a big winner from the budget, with the already announced payroll tax cuts and the abolition of the insurance protection tax from July 2011.
Tax cuts for the budget, including the stamp duty measures, total $180 million in 2010-11, and $201 million the following year.
Tuesday's budget also sees a dramatic fall in the state's unemployment forecasts.
Last year, in the midst of the GFC, treasury had predicted the unemployment rate would hit 8.5 per cent next financial year.
Instead, unemployment of 5.5 per cent is expected for 2010/11, dropping to 5.25 per cent in 2011-12.
Gross State Product (GSP) growth also rebounded significantly, to 2.5 per cent for 2009/10, from a the previous budget forecast of a decline of 0.5 per cent.
The state's GSP growth for 2010/11 is now predicted to reach three per cent, and 3.5 per cent in the following year.
The budget also included a record $16.4 billion in health spending, and $22.3 billion over four years to fund measures in the government's Metropolitan Transport Plan.
The state's road network will get $10.6 billion, including $3 billion for the Pacific Hwy, $750 million for the Hume Highway, $680 million for the Great Western Hwy, and $500 million for the Princes Hwy.
Infrastructure spending will reach $62.2 billion over the next four years, creating 155,000 jobs, Mr Roozendaal said.
"Together we stood firm against the global economic crisis and together we will share the rewards of recovery as we build the next phase of our economic growth," Mr Roozendaal said.