"Most of those under investigation would not be aware that they are being investigated," Ms O'Dwyer said, urging investors to self declare "before we get to them". Under the amnesty there will be reduced penalties for investors that voluntarily tell the Tax Office they have breached the rules. The amnesty will also mean that they have 12 months to divest – rather than a shorter period at the discretion of federal Treasurer Joe Hockey – and they will not be referred to the Commonwealth Director of Public Prosecutions for criminal prosecution. Ms O'Dwyer said the government's new measures were not about deterring foreign investment, but stopping non-compliance with Australia's laws.​ Foreign investors plowed $34.7 billion into residential real estate in 2013-14, up from $17.6 billion the year before. And the total number of approved investments rose to 23,054 (from 11,668 in the prior financial year).

Apart from being hit with tougher sanctions, the government is also introducing a $5000 fee on foreign investment in residential properties valued at $1 million or less, and $10,000 fee on those over $1 million. It estimates the fees will bring in an extra $200 million a year in revenue, although industry figures believe this figure is exaggerated. Ms O'Dwyer said the revenue gain could be significant because apart from being hit with hefty fines, investors could also be forced to pay back any capital gains made on property purchases. She hoped the new laws would deter illegal activity, but "we expect there will be people who continue to do the wrong thing and we will have capacity to impose civil penalties".​ Under the ATO data-matching program, the Tax Office will acquire details of foreign investors that apply to the Foreign Investment Review Board to purchase residential or agricultural land in Australia for the 2010-11 to 2015-16 financial years. ​It will examine the records of 30,000 "entities", which are mostly individuals. Data including their name and contact details, country of residency, nationality, passport details and land owned by them (including title references and land holding type) will be cross-checked with ATO information, as well as information held by other government agencies.

The ATO will also look at details on purchase of shares in an Australian company that owns urban land or of units in an Australian urban land trust, and will examine ownership structures to determine if the real or beneficial owners are non-resident in compliance with Foreign Acquisitions and Takeovers Act. The ATO said its current investigation involved a wealthy taxpayer who has received around $4 million in international funds over the last five years and had links to several Australian properties.​ Property Council of Australia chief executive Ken Morrison welcomed the government’s crackdown on illegal purchases, saying it was "long overdue". But he said the Property Council did not support the "imposition of excessive new fees" on lawful foreign investment as it would jeopardise housing supply and further dent affordability. Master Builders chief executive Wilhelm Harnisch, who has also been critical of the government's policy, questioned whether the crackdown would lead to greater revenue. "It [the amount] may not be what the government is expecting," he said. The Australia Institute’s executive director, Richard Denniss, also doubted the new fees on foreign investment and the crackdown would raise significant revenue, saying there would be increased compliance costs.

It is unclear from the FIRB data on foreign buyers how many of those "approved" applications resulted in developments, but the government hopes to get better information with the introduction of a national register. This land register would require the support of the states and territories, Ms O'Dwyer said. The recent parliamentary inquiry into foreign ownership of residential real estate, run by the House Economics Committee headed by Ms O'Dwyer, received several submissions criticising the approvals process as just a rubber stamp. It heard developers were able to obtain a single FIRB approval to sell up to 100 per cent of the properties to foreign buyers, and did not then require individual approvals. FIRB data shows that investment in real estate is by far the most common investment by foreign buyers. In terms of all foreign investment made (not just residential real estate) the Chinese are the biggest source, approved to spend $27.7 billion, and overtaking United States investors who were approved to spend $17.5 billion. About $12.4 billion of this approved spending by the Chinese is planned for real estate.