Australia's south-eastern state of Victoria, home to the city of Melbourne, will more than double property taxes for foreign buyers and treble royalties from coal, the government has announced. The hike in stamp duty on residential properties purchased by foreigners appears to run counter to a warning earlier in the month from the central bank that recent rapid rises in property prices could stall if international demand, particularly from China, slipped.
China is Australia's largest source of foreign property investment, according to the most recent annual report from Australia's Foreign Investment Review Board.
The stamp duty will rise to 7 percent from 3 percent from July 1, Victoria's treasurer Tim Pallas said in a statement outlining state budget measures on Friday.
"It's only fair that foreign buyers of residential real estate, who enjoy the capital growth as a result of Victoria's liveability and the amenity of our cities, contribute to the maintenance of government services and infrastructure," he said.