The ACT Government could be liable to pay back hundreds of thousands of dollars to home and land buyers after a landmark Supreme Court ruling.

A young couple who bought a block of land at Crace in Canberra's north for $81,000 say they were promised as first home buyers that they would only need to pay a stamp duty of $20.

But their lawyer Allan Nelson says that is not what their bill came to.

"They got one great shock when later in the year it was assessed at almost $17,000," Mr Nelson said

The issue arose when the Government calculated the stamp duty on the total value of the house and land package, worth nearly $435,000.

"They were signing a building contract straight after the time they signed the land contract and they were inter-dependant," Mr Nelson said.

"They were different parties of course and that was the crux of the whole matter."

The couple took the case to the ACT Civil and Administrative Tribunal and won in late 2010.

But the Government appealed and the matter moved to the ACT Supreme Court in 2011.

On Thursday Justice Hilary Penfold handed down her judgement, ruling that the Government could only charge stamp duty on the land that it had sold.

Meaning as first home buyers, and qualifying for the concessional rate, the couple are only liable to pay $20.

'Exciting result'

Mr Nelson says despite his confidence he was very excited at the result.

"I had a quiet celebration last night with my wife and we will probably continue it," he said.

"It was such a good win.

"I've already had a couple of calls from people today who were in a similar situation and wondering whether or not they might be able to take advantage of this decision.

"[One] was a 19-year-old girl at the time and she was lured into this by the same promise of $20 and turned it out to be $17,000 or $18,000 instead.

"Money had to be borrowed to pay the stamp duty within 12 months."

Future implications

Mr Nelson says he is aware of at least 30 other possible cases in the same development area as the couple.

"The Government will have to pay interest at about the same rate they charge late payers of stamp duty," he said.

"Around 11 to 12 per cent interest on the money that they've had for all the time they've had it."

Mr Nelson says the Government has at least three weeks to decide their next move.

"It could be appealed by the Government," he said.

"They've got deep pockets and they have a lot at stake, so we're just hoping they accept the decision of the Supreme Court."

In a statement the director general of the Commerce and Works Directorate Megan Smithies says the Commissioner for Revenue is considering the decision.

"In due course, the Commissioner will make a decision on action, if any, that might be taken regarding the decision," she said.

Opposition spokesman Brendan Smyth says the Government must come clean on how much they may need to pay back.

"We just need to know how many people have paid stamp duty incorrectly even if its tens or dozens rather than hundreds," he said.

"It's a significant amount of money if you're a young couple setting up a home and of course that will leave a hole in the Governments budget."

The Government says in the meantime it will not be commenting.

 

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