Western Australia State Budget 2026-27 | Stability prioritised over sweeping reform
Western Australia State Budget 2026-27 | Stability prioritised over sweeping reform
Treasurer, The Hon Rita Saffioti MLA, has handed down the Western Australian State Budget 2026-27, with a further operating surplus of $2.4 billion, reinforcing WA’s position as the strongest‑performing state fiscally after its eighth successive budget surplus.
The 2026–27 Western Australian State Budget includes few targeted tax measures, primarily focused on first home buyers and off‑the‑plan developments with changes to transfer (stamp) duty.
The Budget confirms the absence of any new or increased tax measures in payroll tax, land tax, or mining and energy royalty regimes meaning that existing thresholds and exemptions remain intact. By largely maintaining the status quo for these key revenue sources, the Government has chosen to prioritise tax stability and avoid imposing additional burdens on businesses or the resources sector, consistent with its broader fiscal strategy of responsible financial management.
Transfer duty – Targeted relief over broader reform
The stamp duty exemption threshold for first home buyers has increased by $100,000 to $600,000, with the concessional threshold also lifted by $100,000 to $800,000. This represents the largest single increase to first home buyer duty thresholds to date and is estimated by the Government to benefit more than 25,000 first home buyers.
For vacant land purchases, stamp duty has been abolished for land valued up to $450,000, with concessional rates applying up to $550,000, in an effort to encourage new residential builds.
In addition, the price cap for eligibility for the $10,000 first homeowner grant has increased from $750,000 to $800,000, expanding access to the grant amid elevated house prices.
The Government estimates these changes will deliver stamp duty savings of up to $22,515 for eligible first home buyers purchasing a new or established home, and up to $25,390 for house and land packages. These Budget measures build on the Government’s 12 March 2026 announcement to extend the off‑the‑plan duty concession through to 30 June 2028.
The expanded transfer duty concessions will also support eligible seniors looking to downsize, helping to reduce transaction costs and improve housing mobility in a tight residential market.
While expanding targeted relief, the Budget does not introduce broader stamp duty reform. The Treasurer has explicitly ruled out:
- Across‑the‑board stamp duty rate reductions, and
- Structural reform to replace transfer duty with a broad‑based land or property tax.
It is also worth noting that WA remains one of only two states that still imposes duty on the transfer of business assets.
Transfer duty remains a core component of WA’s state revenue base, with relief delivered through threshold adjustments rather than system-wide change.
Foreign buyers duty exemption
The Budget also introduces a new foreign buyers duty exemption aimed at boosting housing supply. From 7 May 2026, foreign buyers may be exempt from foreign buyer duty where land is acquired and new dwellings are constructed and sold within two years, broadening access beyond the existing regime that was limited to large-scale developments.
BDO Comment
Taxpayers should continue to carefully assess eligibility criteria and contract timing to ensure concessions are accessed appropriately, particularly where transactions straddle concession start or end dates.
No change to business asset transfer duty
Despite Western Australia remaining one of only two Australian jurisdictions to retain business asset transfer duty, the Budget stopped short of addressing the issue. With an eighth successive surplus, the Government had an opportunity to remove a longstanding barrier to business transactions and succession planning.
BDO comment
The decision to leave business asset transfer duty unchanged maintains the status quo for existing and prospective business transactions in Western Australia. While providing certainty, it also means that a long‑standing area of divergence from other jurisdictions remains unresolved at the cost of continued complexity and competitive disadvantage for Western Australian businesses.
Payroll tax – No relief for businesses
The Budget did not include any substantive changes to payroll tax or relief for employers. Small and medium-sized businesses continue to operate in what may be considered an inefficient and increasingly outdated payroll tax regime. While the Government has opted against increasing payroll tax settings, it has also declined to provide any meaningful new relief or concessions for employers facing sustained cost pressures.
BDO Comment
With businesses contending with rising fuel costs, inflationary pressures, higher wages, insurance costs and broader cost-of-living impacts flowing through supply chains and consumer demand, the Budget presented an opportunity to provide targeted payroll tax relief to smaller employers. Modest measures, such as threshold increases, temporary rebates or expanded exemptions, would have provided some relief for Western Australian businesses.
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