Overseas developers who seek to build "significant" residential projects will be exempt from the Queensland government's three per cent foreign investment tax.

The budget measure, announced in June, was expected to raise $15 million in the first year and $25 million per year after that.

Queensland Treasurer announces the tax will be relaxed for 'significant' development. Credit:Bradley Kanaris

But Treasurer Curtis Pitt was criticised for breaking a promise after he last year ruled out new taxes targeting foreign property investment.

Mr Pitt announced on Friday plans to water down the rules, with foreign investors who build developments that include 50 or more residential lots exempt from the tax.