Key Factors
- Victorian Treasurer Tim Pallas has introduced plans to broaden a vacant land tax to the remainder of the state.
- The tax at present applies in 16 Melbourne councils to residential properties unoccupied for over six months a 12 months.
- The change is slated to start out from January 2025.
A tax on vacant residential blocks in Victoria can be broadened to drive house owners to develop their land or promote it to somebody who will.
As parliament returned on Tuesday, Treasurer Tim Pallas introduced the federal government would introduce laws to broaden the vacant residential land tax to all of Victoria, together with regional areas.
At the moment, the tax applies to residential properties throughout 16 internal and center Melbourne councils which are unoccupied for greater than six months a 12 months.
Homeowners are yearly charged one per cent of the property’s improved worth, which means a vacant house with a worth of $500,000 could be taxed $5000.
The change is slated to start out from January 2025.
“We will not afford actually to have vacant land in metropolitan Melbourne sitting idle year-on-year,” Pallas mentioned in a speech at a Property Council breakfast on Tuesday.
“Our clear message to landowners is to both develop the land or promote it to somebody who will.”
Victorian Treasurer Tim Pallas introduced the deliberate change at a Property Council breakfast on Tuesday. Supply: AAP / Joel Carrett
State authorities businesses will even be requested to justify why they’re holding vacant land somewhat than placing it again into {the marketplace}.
“We’re not putting in a rule for landowners that we as a state will not be going to deploy to ourselves,” Pallas mentioned.
Vacant residential land tax at present nets the Victorian authorities about $6 million a 12 months and is run by the state income workplace.
The Property Council’s Victorian government director Cath Evans mentioned the announcement got here as a shock and the council wasn’t consulted on the adjustments.
“There might be (antagonistic penalties), and the satan can be within the element,” she informed reporters at parliament.
“If work which is designed to speed up housing … isn’t delivered, then these reforms could in truth be an additional obstacle to the supply of housing inventory.”
Evans was to fulfill with the treasurer on Tuesday afternoon in a bid to make clear the brand new coverage.
The Opposition’s Treasury spokesperson Brad Rowswell mentioned one of many first acts of the federal government below was to slug Victorians with an elevated tax.
“We have right here the drained, outdated, identical Labor authorities again to their very own tips,” he mentioned.
The Greens welcomed the proposed change however advised the tax would stay ineffective whereas vacancies have been self-declared by property house owners.
“Increasing the emptiness tax is a crucial step, but it surely must be correctly enforceable,” state social gathering chief Samantha Ratnam mentioned.
The Victorian authorities in September on short-term lodging bookings with platforms reminiscent of Airbnb and Stayz.
The proposed 7.5 per cent levy was the one tax unveiled as a part of Labor’s long-awaited housing assertion to spice up provide amid a nationwide disaster.
From January, 860,000 funding, vacation house or enterprise property house owners will even pay $1300 a 12 months on common in further land tax as a part of a 10-year $31.5 billion COVID-19 debt levy revealed within the state funds.