Queensland has more than doubled its expected budget surplus after the booming housing market pumped billions of extra dollars into the state's coffers.
Treasurer Cameron Dick revealed the state's official operating surplus for the 2021-22 financial year was $4.3 billion.
It is the biggest budget surplus in Queensland history and more than twice the $1.9 billion surplus that was predicted in the June budget.
Mr Dick told parliament the surplus was a result of lower spending and increased tax revenue, made up primarily from stamp duty from real estate sales.
"In extraordinary times, this is an extraordinary result," he said.
A significant portion of the surplus will fund the government's new commitment to the Housing Investment Fund – a pool of grants aimed at funding development and operation of social housing, which was increased by $1 billion at a dedicated housing summit last week.
"That additional investment will help deliver 5,600 new social and affordable homes," Mr Dick said.
Where did this money come from?
The $2.4 billion of extra money is the result of lower spending and increased revenue.
A parliamentary report about the surplus shows the government pocketed $510 million more tax revenue than it expected.
That includes almost $350 million of stamp duty, which was a result of "increased volumes of real estate sales and the increase price of real estate" over the last financial year.
"Payroll tax revenue was also higher [by $44 million], relative to the estimated actual forecast, due to the ongoing exceptionally strong labour market conditions in Queensland," Mr Dick said.
Gambling tax, land tax and motor vehicle tax were also higher than expected in June.
The government also recorded an excess of grant revenue totalling $759 million, which comes from additional COVID-19 funding from the federal government and higher GST revenue due to the growth of the national GST pool.
Queensland's expenses bill was almost $1 billion lower than what was expected, primarily because the government did not have to pay as much as it expected for COVID quarantine or compliance.
Where does the money go?
The excess money will allow the state government to fund its extra commitment to the Housing Investment Fund without borrowing extra money, Mr Dick said.
It will allow Queensland to create financial buffers for emerging economic and financial risks, such as natural disasters, according to the parliamentary report.
"Given the extreme international volatility we face, and the prospect of a third severe consecutive La Niña, it's important that we further strengthen Queensland's fiscal buffers," Mr Dick said.
'Budget repair needs to be ongoing'
The budget surplus was a "stunning and unexpected achievement", Pradeep Philip of Deloitte Access Economics said.
Dr Philip said the increase in stamp duty was a result of the housing market boom.
"One of the key factors during COVID was interstate migration into Queensland and you're starting to see the impact of that flow through in terms of stamp duty because the housing market really took off," he said.
Dr Philip said a key challenge for the future was maintaining that improvement.
"Genuine budget repair needs to be ongoing," he said.
"A key thing for the future is how much of this improvement in the bottom line is cyclical — is temporary versus structural.
"Australian governments across the country have some major challenges because we're facing headwinds globally which will affect our export market, which will affect the environment in which the Queensland economy operates.
"We need to think about the security of our tax base and make sure that our expenditures are as efficient and appropriate as possible."
