The Federal Budget is set to slug foreign buyers thousands in fees if they leave their investment property vacant.
According to Sky News, the measure could see foreigners pay fees as high as $5000 per property if their house or apartment is left empty.
This would be on top of the Foreign Investment Review Board’s residential land fees.
Foreign nonresidents need to apply for foreign investment approval before purchasing any residential property in Australia and pay fees of $5000-$90,000 per property depending on its value.
The revenue measures will be used to fund other housing affordability measures in the budget, according to the report.
In March The Daily Telegraph reported that government ministers were looking at ways to apply a vacancy tax on foreign buyers who leave their investment properties empty, driving up rents.
One proposal would be to investigate the daily water usage of each of the properties in co-operation with the states.
Labor recently announced in April further policy measures they would pursue if they were in government including a vacancy tax.
If they were to gain office, Shadow Treasurer Chris Bowen said Labor would facilitate a Council of Australian Government process to introduce a uniform vacant property tax across all major cities.
A spokesman for Treasurer Scott Morrison declined to comment on the new report.
Treasury has been working on housing affordability package for May budget.
On Sunday Resources Minister Matthew Canavan refused to confirm reports of a new plan to allow first home buyers to use some of their pre-tax income to save for a deposit.
The Australian Taxation Office is in the process of building a nationwide register of foreign-owned land, under the Foreign Investment Framework, to identify which land is owned by overseas nationals.
This could be compared with water usage levels, kept by each state, to determine which properties are sitting vacant.
There is a similar model in Vancouver, Canada, where owners of unoccupied homes pay additional tax.
University of NSW research suggests up to 90,000 properties are sitting empty, while in Melbourne figures have shown almost 20 per cent of investor-owned homes were empty.