Foreign investment application fees will double and penalties will be increased in a move that will add $455 million to the budget’s bottom line. 

The new fees range from $4000 on investments valued at less than $75,000, to more than $1 million for residential investments over $40 million and commercial ones over $2 billion.

While foreign investment in the nation’s interest is welcomed, application fees ensure the cost of administering the foreign investment framework is not borne by Australians, Treasurer Jim Chalmers says.

“We welcome foreign investment in Australia because it plays a crucial role in Australia’s economic success and will continue to be important into the future,” he said in a statement.

“We will always put Australian interests first. That means ensuring Australians benefit from foreign investment in Australia.”

Mr Chalmers said the increase, a policy that Labor took to the election, was necessary due to the state of the budget.

Residential properties up to $2 million will have an additional fee of about 1.3 per cent, while the maximum fee for commercial investments over $50 million will generally sit at less than 0.1 per cent of the transaction value.

This drops to an increase of less than 0.03 per cent for large commercial investments, which make up the majority of foreign investment in Australia.

The new fees will come into effect from July 29.