Sep
19

Another 16 Residential Properties Held by Foreign Investors Worth $14 Million Forced to Sell

Treasurer Scott Morrison has forced the sale of another 16 residential properties held by foreign investors worth $14 million because they were in breach of the law.
Buying Pic  The properties were purchased in Victoria, NSW, Queensland and Western Australia with prices ranging from $200,000 to $2 million, and involved individuals from the UK, Malaysia, China and Canada.

“The foreign investors either purchased established residential property without Foreign Investment Review Board approval, or had approval but their circumstances changed, meaning they were breaking the rules,” Mr Morrison said in a statement on Monday.

Since taking office in 2013, the coalition government has forced foreign nationals to divest a total of 46 properties worth almost $93 million.

The government had to ensure foreign investment provided benefits to all Australians in line with law and not contrary to the national interest, the treasurer said.

Since the government introduced a new penalty regime late in 2015, 179 notices have been issued to people who have failed to obtain FIRB approval before buying a property.

Illegal real estate purchases by foreign citizens attract criminal penalties of up to $135,000 or three years’ imprisonment, or both for individuals; and up to $675,000 for companies.

The new rules also allow capital gains made on illegal investments to be forfeited.

In addition to divestments, a number of investors voluntarily sold their properties while the Australian Taxation Office was examining their case.

“There are at least 25 examples of foreign investors self-divesting in this way showing a change in behaviour towards more compliance with the rules and a strengthening of the program overall,” Mr Morrison said.

(Source: Reported by Colin Brinsden, AAP Economics Correspondent - Monday, September 19, 2016)