Stamp duty abolished for some home buyers in an Australia-first move

The ACT will become the first Australian jurisdiction to abolish stamp duty for all first home buyers, with the landmark reform taking effect from 1 July 2026 as part of the Territory Budget.

The move removes one of the largest upfront costs associated with purchasing a home and forms part of the ACT Government’s long-running transition away from transaction taxes and towards a broader property-based tax system.

Under the changes, all eligible first home buyers will be exempt from paying stamp duty regardless of their income or the value of the property they purchase. The reform replaces the current concession system, which applies income thresholds and property value limits.

Chief Minister Andrew Barr described the announcement as a significant milestone in the ACT’s tax reform agenda.

“This Budget marks a major milestone in our long-term tax reform program, delivering a fairer system and improving housing affordability for Canberrans,” Mr Barr said.

He said stamp duty had long represented one of the biggest barriers facing aspiring homeowners.

“Stamp duty has long been one of the biggest upfront hurdles to entering the housing market. From 1 July 2026, that barrier is gone for first home buyers in the ACT.”

The ACT Government estimates the savings could be substantial. On a $1 million property, buyers could avoid around $30,000 in stamp duty, while purchasers of a $1.5 million home could save approximately $70,000.

The reform also broadens duty exemptions for other cohorts. Pensioners, eligible NDIS participants and people returning to the property market after not owning a home for at least five years will also benefit from the removal of stamp duty.

The stamp duty concession for owner-occupiers buying units off-the-plan will continue, and will also be expanded to newly-constructed units, which were not sold off-the-plan.

Broader housing supply initiatives unveiled

The announcement is the latest stage of a reform program launched by the ACT Government more than a decade ago.

Since 2012, the territory has progressively reduced reliance on conveyance duty while increasing general rates, arguing that property transaction taxes discourage mobility and create barriers to home ownership.

Mr Barr has repeatedly argued that stamp duty is an inefficient tax that penalises people when they move home, whether for work, family or lifestyle reasons. According to the Government, the latest changes represent the culmination of that strategy for first home buyers.

Housing affordability remains a dominant political and economic issue across Australia, with governments at all levels searching for ways to improve access to home ownership.

The ACT’s approach differs from most other states and territories, which continue to rely heavily on stamp duty revenue while offering targeted concessions for eligible buyers.

The Budget measure is also linked to broader housing supply initiatives.

Alongside the abolition of stamp duty, the ACT Government has announced additional support for higher-density and so-called “missing middle” housing, which includes townhouses, terraces and low-rise apartment developments.

The Government argues that reducing transaction costs and encouraging new housing supply will help improve affordability over the longer term, particularly for younger households seeking to enter the market.

Industry groups have generally welcomed the reform, noting that stamp duty often represents one of the largest non-deposit costs facing buyers. Removing that burden may help some households purchase sooner or retain more savings after settlement.

However, the policy is also expected to reignite debate about the broader shift from stamp duty to annual property charges.

While economists have long argued that land-based taxes are more efficient than transaction taxes, the transition remains politically sensitive because it changes how governments collect revenue from property owners.

In New South Wales, meanwhile, the government is dealing with issues around calls for stamp duty overcharging refunds.