Queensland’s property tax landscape is evolving rapidly, and in 2025 it has become a defining factor for many foreign owners and agribusiness funds. Alongside general land tax, the state imposes a 3% foreign land tax surcharge (effective 1 July 2024), which can materially increase the cost of holding freehold land.
Media coverage in recent months has reported that several major agricultural fund managers are reviewing or even divesting their Queensland portfolios due to this increased tax burden. This is not just a fiscal challenge — it is a strategic one. For some investors, the difference between staying invested and exiting the market comes down to whether they can secure ex gratia relief.
What Ex Gratia Relief Really Is — and Why It Matters
Ex gratia relief is a discretionary remission of state tax, granted where an anomaly in the legislation causes tax to be applied in a way that Parliament did not intend. It is not a loophole, nor is it a routine exemption — it is a fairness mechanism, used to correct unintended outcomes.
Relief may apply to:
- Land tax foreign surcharge
- Additional Foreign Acquirer Duty (AFAD)
- Other state taxes where an unintended outcome is demonstrated
For landholders, the implications are significant: relief can reduce or refund the surcharge liability entirely, restoring economic viability to long-term projects.
The 2025 Context: Rising Scrutiny and Capital Decisions
The 2024–25 state budget raised the foreign surcharge from 2% to 3%, signalling a policy direction of continued pressure on foreign landholders. Combined with higher interest rates and tight margins in agriculture, this has turned land tax planning into a boardroom issue.
Industry commentary highlights two tensions:
- Government policy goals: Ensuring foreign owners pay their “fair share” and discouraging land banking
- Economic reality: The state’s agriculture sector depends on foreign capital, infrastructure spending, and innovation
This context makes ex gratia relief a critical tool — not just for reducing tax but for giving investors confidence that policy will not punish productive, economy-supporting operations.
Our Approach at Ensure Legal
Because ex gratia relief is discretionary, success depends on how persuasively a case is presented. This is where our team delivers value.
We provide:
- Strategic eligibility review — analysing whether the surcharge applies in a way inconsistent with legislative intent
- Evidence curation — gathering operational data, payroll records, investment figures, and community benefit metrics that strengthen the case
- Policy-aligned submissions — framing arguments in line with the intent of the tax laws and public rulings, making it easy for decision-makers to approve relief
- End-to-end management — preparing and lodging the application, liaising with the Queensland Revenue Office, and keeping you informed throughout
This holistic approach removes the uncertainty and positions your application for the best possible outcome.
Timelines and Risk Management
In our experience, ex gratia applications typically take 4–6 weeks to be determined after all information is provided, but complex cases can take longer. This timing has real-world implications:
- If you are buying or selling land, relief outcomes may affect settlement timelines and contract disclosure
- If you are budgeting for the coming year, a delayed decision could affect cash flow
We help clients manage these risks by seeking early engagement with the Revenue Office, pursuing in-principle comfort where appropriate, and aligning tax planning with other legal obligations such as the new Property Law Act 2023 seller disclosure requirements that came into force on 1 August 2025.
Our Insights: Where the Policy Debate Is Heading
Looking ahead, we expect:
- More scrutiny of foreign holdings — as governments balance housing supply, agricultural security, and revenue generation
- Pressure for transparency — industry is calling for clearer criteria and appeal rights for ex gratia decisions
- Opportunities for reform — as stakeholders argue that productive, economy-supporting investments should be encouraged rather than penalised
Ensure Legal is monitoring these developments closely. By combining legal expertise with real-time market insight, we help clients stay ahead of the curve.
Key Takeaway for Foreign Owners
Ex gratia relief is not a simple formality — it is a strategic process that can save millions in tax but requires expert handling. In 2025’s climate of rising costs and heightened compliance, investors cannot afford to treat it as an afterthought.
Our team assists clients by:
- Reviewing eligibility before liabilities arise
- Preparing robust, policy-aligned submissions
- Managing timing to avoid settlement disruption
- Coordinating with FIRB, land tax, and disclosure compliance
Ready to Talk?
If you are a foreign landholder or investor facing Queensland’s land tax surcharge, talk to our property and tax lawyers about how we can help you secure ex gratia relief and protect your investment strategy.
