The government says an extra 39 businesses will be exempt from paying payroll tax under the changes.

Tuesday’s budget will also bring more cuts to stamp duty, which you pay when you buy a house, as the government moves to phase out the tax over 20 years.

From Wednesday, people aged 60-plus will effectively be exempt from paying stamp duty when they buy a house worth up to $595,000, a change designed to encourage empty-nesters to move out of the family home and stimulate activity in the housing market.

Visit canberratimes.com.au from 3pm for all the details of today's ACT budget

In another change to be announced on Tuesday, stamp duty will be cut for properties worth more than $1.455 million. Most purchases in this category are commercial, although the benefits will also flow to purchases of Canberra’s most expensive houses (these are the same houses, though, whose owners will bear the brunt of big rates hikes). If you buy a property worth more than $1.455 million, the stamp duty will fall from a flat 5.5 per cent to 5.25 per cent.

This means someone buying a $2 million property will pay $5600 less in stamp duty than if they had bought yesterday, but they’re still paying about $105,000 in tax (a saving of 5 per cent).

Someone buying a $5 million property will face a stamp duty bill of $262,500, which is about $25,500 less than they would have paid yesterday.

On payroll tax, Mr Barr will lift the threshold for when businesses must start paying the tax by $100,000, to a wages bill of $1.85 million – which means businesses with about 30 employees.

Once the wages bill tops that figure, tax will be payable at 6.85 per cent. A business with a $2 million wages bill will pay $10,275 in payroll tax, a saving of $6850. A business with a $3 million wages will pay $78,775 in tax, also saving $6850.

Canberra’s regime is significantly more attractive to business than NSW, where a business with a $3 million payroll pays $123,000 in tax.

The ACT has the highest threshold in the country for payroll tax, and Mr Barr said 23,000 businesses were small enough that they didn’t pay any payroll tax at all.

The cuts to stamp duty are funded through increases in rates, and the big news from today's budget will be just how much the average rates bill will increase for the city’s 150,000 homeowners and 6000 commercial ratepayers.

Ratepayers’ Association of the ACT president Peter Jansen is vehemently opposed to the shift to rates, which he said had meant increases for some older homes in the inner north and inner south of as much as 65 per cent over three years (including the projected 10 per cent in the coming year). Predicting an eventual tripling of rates in real terms, Mr Jansen, a former Liberal candidate, called on the government to release its own estimates of the impact in the years to come.

ANZ economist Cherelle Murphy is expecting borrowing and infrastructure spending from Mr Barr in the budget, an approach she believed would be broadly accepted in economic circles assuming the spending was sensible and for the right reasons. It was, however, likely to affect the territory’s triple AAA stable credit rating.

“It seems that they have some plans to put forward some capital spending in this budget as a way of buffeting the territory from the Commonwealth fiscal consolidation and the impact that’s going to have on employment, so we would expect to see something there,” she said.

The territory had very little debt, so had “flexibility to increase debt without causing too much damage”, she said. The government was also looking to take advantage of the Commonwealth incentive payments for asset sales. “That should help in that it brings some cash in the door to provide for infrastructure, which clearly is part of the immediate agenda,” Ms Murphy said.

The ACT Property Council is also looking to infrastructure as a centrepiece of the budget to stimulate activity in the economy, and bring to life a stagnant property market. Executive director Catherine Carter said property and construction was the second biggest employer in the territory and coming off a boom, with very little work at the moment, a cycle made worse by the federal spending cuts.

Vacancy rates were a big problem in the sector, with vacancies as high as 25 per cent in some “dead zone” areas, and needed incentives for landlords to withdraw and convert old stock.

But the sector would fight any increased taxes, fees and charges on the property sector, including levies of development taxes for light rail, she said.