State Taxation Acts and Other Acts Amendment Act 2023 (Vic)
State Taxation Acts and Other Acts Amendment Act 2023
No. 38 of 2023
TABLE OF PROVISIONS
Section Page
Part 1—Preliminary
1Purposes
2Commencement
Part 2—Amendment of Duties Act 2000
3Exemptions from holding controlling interests in foreign corporations or substantial interests in trust estates of foreign trusts
4Exemptions and concessions—Division 2
5Exemptions and concessions—Division 3
6Exemptions and concessions—Division 3A
7Exemptions and concessions—Division 4
8Who is an eligible cardholder?
9Eligible cardholder exemption or concession requirements
10Election to receive eligible cardholder exemption/concession
11How duty is charged on relevant acquisitions in public landholders—concessional rate
12Concession and exemptions for certain transactions arising out of corporate reconstructions, corporate consolidations and arrangements
Part 2A—Amendment of Fire Services Property Levy Act 2012
12AAmendment of Schedule
Part 3—Amendment of First Home Owner Grant and Home Buyer Schemes Act 2000
13Amount of grant
Part 4—Amendment of Local Government Act 1989
14Definitions
Part 5—Amendment of Property Law Act 1958
15Clause 9 of Schedule 3 amended
Part 6—Amendment of Sale of Land Act 1962
16New sections 10G and 10H inserted
16ANew section 58 inserted
Part 7—Amendment of Treasury Corporation of Victoria Act 1992
17Statute law revision amendment
Part 8—Amendment of Valuation of Land Act 1960
18Definitions
Part 9—Amendment of Windfall Gains Tax Act 2021
19Definitions
20Who is liable for windfall gains tax?
21Exemptions in relation to rezoning errors
22Exemptions in relation to rezonings underway before 15 May 2021
23Waiver for charitable land
24Secretary to provide rezoning information to Commissioner
Part 10—Amendment of Land Tax Act 2005
Division 1—Vacant residential land tax across Victoria
25Definitions
26Imposition of vacant residential land tax
27Repeal of section 34D
27AWhat is the rate of land tax?
27BHoliday home exemption
28Exemption for land occupied for purposes of attending place of business or employment
28ANew sections 88EA to 88EC inserted
29Repeal of Schedule 2A
30New clause 21 of Schedule 3 inserted
Division 2—Vacant residential land tax—unimproved land
31Definitions
32What is residential land?
33New section 34BA inserted
34When is residential land vacant?
34AWhat is the rate of land tax?
35New sections 88F and 88G inserted
36New Schedules 2B and 2C inserted
Division 3—Single COVID-19 debt temporary land tax surcharge where land assessed on a single holding basis
37Certain taxable land assessed separately
38General land tax surcharge for trusts
39Land tax for discretionary trust with nominated beneficiary
40Land tax surcharge for absentee trusts
41Land tax for absentee discretionary trust with nominated beneficiary
42New clause 1.7 of Schedule 1 inserted
43New clause 3.7 of Schedule 1 inserted
44New clause 4.7 of Schedule 1 inserted
45New clause 5.7 of Schedule 1 inserted
46New Part 6 of Schedule 1 inserted
Division 4—Miscellaneous
47Absentee exemption requirements
48BTR special land tax—owner of land
Part 11—Repeal of this Act
49Repeal of this Act
═════════════
Endnotes
1 General information
State Taxation Acts and Other Acts Amendment Act 2023
No. 38 of 2023
[Assented to 12 December 2023]
The Parliament of Victoria enacts:
PART 1—PRELIMINARY
1Purposes
The purposes of this Act are—
(a)to amend the Duties Act 2000 in relation to—
(i)reporting requirements for certain exemptions granted by the Treasurer under that Act; and
(ii)duty chargeable on transactions treated as sub-sales of land; and
(iii)the pensioner and concession card duty reduction; and
(iv)concessional rates of duty for corporate reconstructions; and
(ab)to amend the Fire Services Property Levy Act 2012 in relation to the Australian Valuation Property Classification Code for certain land uses; and
(b)to amend the First Home Owner Grant and Home Buyer Schemes Act 2000 in relation to the first home owner grant; and
(c)to amend the Local Government Act 1989 to provide that the value of fixtures is included in the capital improved value of land; and
(d)to amend the Property Law Act 1958 in relation to the apportionment of taxes under a contract of sale of land; and
(e)to amend the Sale of Land Act 1962 in relation to the apportionment of taxes under a contract of sale of land; and
(f)to amend the Treasury Corporation of Victoria Act 1992 to correct a minor technical error; and
(g)to amend the Valuation of Land Act 1960 to provide that the value of fixtures is included in the capital improved value of land; and
(h)to amend the Windfall Gains Tax Act 2021 in relation to exemptions and waivers; and
(i)to amend the Land Tax Act 2005 in relation to—
(i)the circumstances in which vacant residential land tax is payable; and
(ii)the imposition of a single COVID-19 debt temporary land tax surcharge to aggregated land which is otherwise assessed on a single holding basis; and
(iii)reporting requirements for certain exemptions granted by the Treasurer under that Act; and
(iv)the formula for calculating the amount of BTR special land tax payable by owners of land; and
(j)to make other miscellaneous and technical amendments to those Acts.
2Commencement
(1)Subject to subsections (2), (3) and (4), this Act comes into operation on the day after the day on which it receives the Royal Assent.
(2)Parts 5 and 6, Division 3 of Part 10 and section 20 come into operation on 1 January 2024.
(3)Division 1 of Part 10 comes into operation on 1 January 2025.
(4)Division 2 of Part 10 comes into operation on 1 January 2026.
PART 2—AMENDMENT OF DUTIES ACT 2000
3Exemptions from holding controlling interests in foreign corporations or substantial interests in trust estates of foreign trusts
In section 3E(3) of the Duties Act 2000, for "6 months" substitute "12 months".
4Exemptions and concessions—Division 2
After section 32G(4) of the Duties Act 2000 insert—
"(5)If the first purchaser would be entitled to a concession under Part 2 of Chapter 11 if the sale contract were a transfer to the first purchaser, the first purchaser is entitled to that concession in respect of duty charged under section 32C(1)(a).
(6)Subject to subsection (7), a subsequent purchaser is entitled to a concession under Part 2 of Chapter 11 in respect of duty charged under section 32C(1)(b) or (c) if—
(a)the subsequent purchaser would be entitled to a concession under Part 2 of Chapter 11 if the subsequent transaction were a transfer to the subsequent purchaser; and
(b)the subsequent purchaser obtained the transfer right from—
(i)a first purchaser who is liable to pay the amount of duty charged under section 32C(1)(a); or
(ii)another subsequent purchaser who is liable to pay the amount of duty charged under section 32C(1)(c).
(7)If a subsequent purchaser would be entitled to an exemption under section 250B(2) if the subsequent transaction were a transfer to the subsequent purchaser, the subsequent purchaser is entitled to that exemption in respect of duty charged under section 32C(1)(b) or (c).".
5Exemptions and concessions—Division 3
After section 32N(4) of the Duties Act 2000 insert—
"(5)If the first purchaser would be entitled to a concession under Part 2 of Chapter 11 if the sale contract were a transfer to the first purchaser, the first purchaser is entitled to that concession in respect of duty charged under section 32J(1)(a).
(6)Subject to subsection (7), a subsequent purchaser is entitled to a concession under Part 2 of Chapter 11 in respect of duty charged under section 32J(1)(b) or (c) if—
(a)the subsequent purchaser would be entitled to a concession under Part 2 of Chapter 11 if the subsequent transaction were a transfer to the subsequent purchaser; and
(b)the subsequent purchaser obtained the transfer right from—
(i)a first purchaser who is liable to pay the amount of duty charged under section 32J(1)(a); or
(ii)another subsequent purchaser who is liable to pay the amount of duty charged under section 32J(1)(c).
(7)If a subsequent purchaser would be entitled to an exemption under section 250B(2) if the subsequent transaction were a transfer to the subsequent purchaser, the subsequent purchaser is entitled to that exemption in respect of duty charged under section 32J(1)(b) or (c).".
6Exemptions and concessions—Division 3A
After section 32OE(4) of the Duties Act 2000 insert—
"(5)If the first purchaser would be entitled to a concession under Part 2 of Chapter 11 if the option were a transfer to the first purchaser, the first purchaser is entitled to that concession in respect of duty charged under section 32OA(1)(a).
(6)Subject to subsection (7), a subsequent purchaser is entitled to a concession under Part 2 of Chapter 11 in respect of duty charged under section 32OA(1)(b) or (c) if—
(a)the subsequent purchaser would be entitled to a concession under Part 2 of Chapter 11 if the subsequent transaction were a transfer to the subsequent purchaser; and
(b)the subsequent purchaser obtained the transfer right from—
(i)a first purchaser who is liable to pay the amount of duty charged under section 32OA(1)(a); or
(ii)another subsequent purchaser who is liable to pay the amount of duty charged under section 32OA(1)(c).
(7)If a subsequent purchaser would be entitled to an exemption under section 250B(2) if the subsequent transaction were a transfer to the subsequent purchaser, the subsequent purchaser is entitled to that exemption in respect of duty charged under section 32OA(1)(b) or (c).".
7Exemptions and concessions—Division 4
After section 32U(4) of the Duties Act 2000 insert—
"(5)If the first purchaser would be entitled to a concession under Part 2 of Chapter 11 if the option were a transfer to the first purchaser, the first purchaser is entitled to that concession in respect of duty charged under section 32Q(1)(a).
(6)Subject to subsection (7), a subsequent purchaser is entitled to a concession under Part 2 of Chapter 11 in respect of duty charged under section 32Q(1)(b) or (c) if—
(a)the subsequent purchaser would be entitled to a concession under Part 2 of Chapter 11 if the subsequent transaction were a transfer to the subsequent purchaser; and
(b)the subsequent purchaser obtained the transfer right from—
(i)a first purchaser who is liable to pay the amount of duty charged under section 32Q(1)(a); or
(ii)another subsequent purchaser who is liable to pay the amount of duty charged under section 32Q(1)(c).
(7)If a subsequent purchaser would be entitled to an exemption under section 250B(2) if the subsequent transaction were a transfer to the subsequent purchaser, the subsequent purchaser is entitled to that exemption in respect of duty charged under section 32Q(1)(b) or (c).".
8Who is an eligible cardholder?
(1)Insert the following heading to section 58 of the Duties Act 2000—
"Who is an eligible cardholder?".
(2)For section 58(1) of the Duties Act 2000 substitute—
"(1)A person is an eligible cardholder for the purposes of this Division if the Commissioner is satisfied that the person is—
(a)an eligible beneficiary within the meaning of the State Concessions Act 2004; or
(b)the holder of a Seniors Health Card within the meaning of the Social Security Act 1991 of the Commonwealth.".
9Eligible cardholder exemption or concession requirements
After section 60AA(a) of the Duties Act 2000 insert—
"(ab)that each transferee is a natural person acting only in their personal capacity; and
(ac)that each transferee is a bona fide purchaser of an estate in fee simple in land for adequate consideration; and
(ad)that each transferee has not received an exemption, refund or rebate of duty in respect of a transfer—
(i)under section 59 or 60 as in force before the commencement of Division 3 of Part 2 of the State Taxation Acts Amendment Act 2023; or
(ii)under section 71A of the Stamps Act 1958; and".
10Election to receive eligible cardholder exemption/concession
(1)In the heading to section 60A of the Duties Act 2000 omit "eligible cardholder".
(2)In section 60A(1) of the Duties Act 2000, for "an eligible cardholder" substitute "a transferee or, if more than one, transferees".
(3)In section 60A(2) of the Duties Act 2000, for "The eligible cardholder" substitute "The transferee or, if more than one, the transferees".
(4)In section 60A(3) of the Duties Act 2000—
(a)for "the eligible cardholder elects" substitute "the transferee elects or, if there is more than one transferee, the transferees elect";
(b)for "does not make" substitute "do not make";
(c)for "he or she is" substitute "they are".
(5)Section 60A(4) of the Duties Act 2000 is repealed.
11How duty is charged on relevant acquisitions in public landholders—concessional rate
After section 87(3A) of the Duties Act 2000 insert—
"(3B)Subsection (1) does not apply to a relevant acquisition in a public landholder that is also—
(a)an eligible transaction to which section 250B applies; or
(b)a relevant acquisition to which section 250DI applies.".
12Concession and exemptions for certain transactions arising out of corporate reconstructions, corporate consolidations and arrangements
In section 250B(2)(c) and (3A)(c) of the Duties Act 2000, for "30 days after" substitute "the period of 30 days beginning on and including".
PART 2A—AMENDMENT OF FIRE SERVICES PROPERTY LEVY ACT 2012
12AAmendment of Schedule
(1)In item 3 of the Table in the Schedule to the Fire Services Property Levy Act 2012, for "615−623, 626−637," substitute "615−620, 623, 628−637,".
(2)In item 5 of the Table in the Schedule to the Fire Services Property Levy Act 2012, for
"640–642," substitute "621, 622, 626, 627, 640−642,".
PART 3—AMENDMENT OF FIRST HOME OWNER GRANT AND HOME BUYER SCHEMES ACT 2000
13Amount of grant
In section 18(5) of the First Home Owner Grant and Home Buyer Schemes Act 2000—
(a)for "an eligible pensioner (within the meaning of the Duties Act 2000) to whom section 60A(2) of that Act" substitute "a transferee to whom section 60A(2) of the Duties Act 2000";
(b)for "section 59 or 60" substitute "section 60".
PART 4—AMENDMENT OF LOCAL GOVERNMENT ACT 1989
14Definitions
In section 3(1) of the Local Government Act 1989, for the definition of capital improved value substitute—
"capital improved value has the same meaning as in section 2(1) of the Valuation of Land Act 1960;".
PART 5—AMENDMENT OF PROPERTY LAW ACT 1958
15Clause 9 of Schedule 3 amended
(1)In clause 9 of Schedule 3 to the Property Law Act 1958, for "taxes," substitute "taxes (other than tax payable under the Land Tax Act 2005 and tax payable under a notice of assessment issued on or before the date of the contract in respect of a liability arising under the Windfall Gains Tax Act 2021),".
(2)In clause 9 of Schedule 3 to the Property Law Act 1958 omit "In the case of land tax any such apportionment shall be computed on the basis that the land sold is the only land of which the vendor is the owner within the meaning of the Land Tax Act 2005.".
(3)In clause 9 of Schedule 3 to the Property Law Act 1958 after "disregarded." insert "The vendor must not require the purchaser to pay any amount for or towards tax for which the vendor is or may become liable under the Land Tax Act 2005 or for which the vendor is liable under a notice of assessment issued on or before the date of the contract in respect of a liability arising under the Windfall Gains Tax Act 2021.".
PART 6—AMENDMENT OF SALE OF LAND ACT 1962
16New sections 10G and 10H inserted
After section 10F of the Sale of Land Act 1962 insert—
"10G Prohibition on recovering land tax under contract of sale of land
(1)A provision of a contract of sale of land for a sale price less than the threshold amount is of no effect to the extent that the provision purports to require the purchaser under the contract to pay an amount for or towards tax for which the vendor is or may become liable in respect of the land under the Land Tax Act 2005.
(2)A vendor must not enter into a contract of sale of land for a sale price less than the threshold amount if the contract purports to require the purchaser under the contract to pay an amount for or towards tax for which the vendor is or may become liable in respect of the land under the Land Tax Act 2005.
Penalty:For a natural person, 60 penalty units;
For a body corporate, 300 penalty units.
(3)In this section—
sale price, in relation to a contract, means the price of the land that is specified in the contract, however expressed, less any discount or rebate that is specified in the contract, whether or not the discount or rebate is contingent;
threshold amount has the meaning given in section 10I.
10HProhibition on recovering windfall gains tax under option or contract of sale of land
(1)A provision of an option to enter into a contract of sale of land is of no effect to the extent that the provision purports to require the purchaser under the contract of sale of land to pay an amount for or towards tax payable under an existing windfall gains tax liability in respect of the land.
(2)A person must not grant an option to enter into a contract of sale in respect of land if—
(a)there is an existing windfall gains tax liability in respect of the land; and
(b)the option purports to require the purchaser of the land to pay an amount for or towards the tax payable under the windfall gains tax liability.
Penalty:For a natural person, 60 penalty units;
For a body corporate, 300 penalty units.
(3)A provision of a contract of sale of land is of no effect to the extent that the provision purports to require the purchaser under the contract to pay an amount for or towards tax payable under an existing windfall gains tax liability in respect of the land.
(4)A vendor must not enter into a contract of sale of land if—
(a)there is an existing windfall gains tax liability in respect of the land; and
(b)the contract purports to require the purchaser of the land to pay an amount for or towards tax payable under the windfall gains tax liability.
Penalty:For a natural person, 60 penalty units;
For a body corporate, 300 penalty units.
(5)In this section—
windfall gains tax liability means a liability for an amount of tax—
(a)arising under the Windfall Gains Tax Act 2021; and
(b)specified in a notice of assessment served on any person under section 14 of the Taxation Administration Act 1997.
10ICPI adjusted threshold amount
(1)The threshold amount for a calendar year is to be determined in accordance with the following formula—
(a)for a contract entered into on or after 1 January 2024 and on or before 31 December 2024, $10 000 000;
(b)for each subsequent calendar year, the amount determined in accordance with the following formula—
where—
TAis the threshold amount being determined for a calendar year;
Ais the amount of the threshold amount for the previous calendar year, as rounded up or down in accordance with subsection (2);
Bis the sum of—
(a)the consumer price index number for the last reference period in the calendar year preceding the previous calendar year; and
(b)the total of the consumer price index numbers for each of the reference periods (other than the last) in the previous calendar year;
Cis the sum of—
(a)the consumer price index number for the last reference period in the calendar year one year earlier than the calendar year referred to in paragraph (a) of B; and
(b)the total of the consumer price index numbers for each of the reference periods (other than the last) in the calendar year one year earlier than the calendar year referred to in paragraph (b) of B.
Example
In the case of a determination of the threshold amount for 2025, "A" is the threshold amount for 2024, "B" is the sum of the consumer price index numbers for December 2023, March 2024, June 2024 and September 2024 and "C" is the sum of the consumer price index numbers for December 2022, March 2023, June 2023 and September 2023.
(2)The threshold amount determined under subsection (1)(b) is to be rounded up or down to the nearest $100 000 and, if the amount of the CPI to be adjusted is an exact multiple of $50 000, is to be rounded up.
(3)The Director of Consumer Affairs must publish the threshold amount for a calendar year on an appropriate website on or before 1 December in the calendar year preceding the relevant calendar year.
(4)A failure to comply with subsection (3) in respect of a calendar year does not affect the operation of section 10G in respect of the threshold amount for that year.
(5)In this section—
consumer price index means the all groups consumer price index weighted average of eight capital cities in original terms published by the Australian Bureau of Statistics as at 15 November immediately preceding the date on which the Director of Consumer Affairs publishes the threshold amount under subsection (3).".
16ANew section 58 inserted
After section 57 of the Sale of Land Act 1962 insert—
"58 Apportionment of amounts under contracts of sale of land
(1)Section 10G does not apply to a contract of sale of land entered into before 1 January 2024.
(2)Section 10H does not apply to any of the following—
(a)a contract of sale of land entered into before 1 January 2024;
(b)an option to enter into a contract of sale of land granted before 1 January 2024;
(c)a contract of sale of land entered into on or after 1 January 2024 under the exercise of an option that was granted before 1 January 2024.".
PART 7—AMENDMENT OF TREASURY CORPORATION OF VICTORIA ACT 1992
17Statute law revision amendment
In Schedule 1 to the Treasury Corporation of Victoria Act 1992, in Column 2, for "Transport Integration 2010" substitute "Transport Integration Act 2010".
PART 8—AMENDMENT OF VALUATION OF LAND ACT 1960
18Definitions
(1)In section 2(1) of the Valuation of Land Act 1960 insert the following definition—
"fixture, on land, means any of the following, whether owned by the owner of the land or a tenant or any other occupier of the land—
(a)anything that constitutes a fixture at law;
(b)any other item fixed to the land;".
(2)After section 2(2A) of the Valuation of Land Act 1960 insert—
"(2B) In determining the capital improved value of any land, the sum which the land might be expected to realize at the time of valuation includes the value of the fixtures on the land.".
PART 9—AMENDMENT OF WINDFALL GAINS TAX ACT 2021
19Definitions
In section 3(1) of the Windfall Gains Tax Act 2021—
(a)in the definition of charitable land, after "land" insert ", or part of land,";
(b)in the definition of excluded rezoning, for paragraph (c) substitute—
"(c)the first rezoning of land that was in the contribution area within the meaning of section 201RC of the Planning and Environment Act 1987 immediately before that rezoning; or".
20Who is liable for windfall gains tax?
At the foot of section 8 of the Windfall Gains Tax Act 2021 insert the following note—
"Note
The owner of land must not purport to require the purchaser under an option to purchase the land or a contract of sale of the land to pay an amount for or towards an assessed windfall gains tax liability. See section 10H of the Sale of Land Act 1962.".
21Exemptions in relation to rezoning errors
(1)In section 38(1) of the Windfall Gains Tax Act 2021—
(a)after "if" insert "the Commissioner is satisfied that";
(b)for "prepared under section 20A of the Planning and Environment Act 1987" substitute "(whether prepared under section 20A of the Planning and Environment Act 1987 or otherwise)".
(2)After section 38(1) of the Windfall Gains Tax Act 2021 insert—
"(1A)The Commissioner may consult the Secretary to the Department of Transport and Planning in determining whether a rezoning is a correcting WGT event.".
(3)After section 38(3) of the Windfall Gains Tax Act 2021 insert—
"(3A)If a rezoning consists partly of a correcting WGT event and partly of a rezoning that is not a correcting WGT event in relation to the same land—
(a)any value uplift attributable to the correcting WGT event is to be ignored in assessing any windfall gains tax on the land; and
(b)for that purpose the Commissioner must seek the advice of the Valuer‑General as to the amount of value uplift attributable to the correcting WGT event.".
22Exemptions in relation to rezonings underway before 15 May 2021
In section 40(3) of the Windfall Gains Tax Act 2021, in the definition of Amendment Tracking System, for "Environment, Land, Water" substitute "Transport".
23Waiver for charitable land
In section 41(1) of the Windfall Gains Tax Act 2021, after "the land" insert ", or relevant part of the land,".
24Secretary to provide rezoning information to Commissioner
In section 43 of the Windfall Gains Tax Act 2021, for "Environment, Land, Water" substitute "Transport".
PART 10—AMENDMENT OF LAND TAX ACT 2005
Division 1—Vacant residential land tax across Victoria
25Definitions
In section 3(1) of the Land Tax Act 2005, in the definition of VRT land—
(a)in paragraph (b), for "section 34C; and" substitute "section 34C;";
(b)paragraph (c) is repealed.
26Imposition of vacant residential land tax
For section 34A(1) of the Land Tax Act 2005 substitute—
"(1)Vacant residential land tax is imposed each year on taxable land in Victoria that is residential land which is vacant.".
27Repeal of section 34D
Section 34D of the Land Tax Act 2005 is repealed.
27AWhat is the rate of land tax?
For section 35(3) of the Land Tax Act 2005 substitute—
"(3)Subject to section 88EB, the rate of vacant residential land tax is—
(a)if the land was not liable for vacant residential land tax in the preceding tax year—1%; or
(b)if the land was liable for vacant residential land tax in the preceding tax year but not the tax year preceding that tax year—2%; or
(c)if the land was liable for vacant residential land tax in the last 2 preceding tax years—3%.
Note
For the purposes of the vacant residential land tax, the taxable value of the land is the capital improved value of the land as at the relevant date—see section 19(1A).".
27BHoliday home exemption
For section 88A(1)(a) of the Land Tax Act 2005 substitute—
"(a)in the year preceding the tax year—
(i)the owner of the land or a vested beneficiary of a trust to which the land is subject used and occupied other land in Australia as a principal place of residence; and
(ii)the owner of the land or a vested beneficiary of a trust to which the land is subject, or a relative of the owner or vested beneficiary, used and occupied the land as a holiday home for a period of at least 4 weeks (whether continuous or aggregate); and".
28Exemption for land occupied for purposes of attending place of business or employment
In section 88B(1)(b) of the Land Tax Act 2005, for "the specified geographic area (within the meaning of section 34D)" substitute "Victoria".
28ANew sections 88EA to 88EC inserted
After section 88E of the Land Tax Act 2005 insert—
88EALand becomes residential land during third year preceding tax year and has not been used or occupied or changed ownership"
(1)Land is exempt from vacant residential land tax for a tax year if—
(a)at the commencement of the third year preceding the tax year the land was not residential land within the meaning of section 34B(1); and
(b)during the third year preceding the tax year the land becomes residential land within the meaning of section 34B(1); and
(c)during the second year preceding the tax year the land is exempt from vacant residential land tax under section 88D; and
(d)during the year immediately preceding the tax year the land is exempt from vacant residential land tax under section 88E; and
(e)for the period from which the land becomes residential land within the meaning of section 34B(1) up to the tax year—
(i)the land has not been used or occupied; and
(ii)the land has not changed ownership; and
(f)the Commissioner is satisfied that during the period referred to in paragraph (e) the owner of the land made genuine attempts to sell the land at or below the price that they expected to receive when construction commenced on the land.
(2)To obtain an exemption from vacant residential land tax under this section, the owner of the land must—
(a)apply to the Commissioner for the exemption on or before 15 January of the tax year; and
(b)give the Commissioner any information the Commissioner requests for the purpose of enabling the Commissioner to determine whether the land is exempt from vacant residential land tax under this section.
88EBResidential land that has not been used or occupied or changed ownership for more than 3 years
(1)Land is eligible for a concessional rate of vacant residential land tax of 1% for a tax year if—
(a)in a preceding tax year, the land becomes residential land within the meaning of section 34B(1); and
(b)in a tax year after the tax year referred to in paragraph (a) but preceding the tax year, the land is exempt from land tax under section 88EA; and
(c)for the period from which the land becomes residential land within the meaning of section 34B(1) up to the tax year—
(i)the land has not been used or occupied; and
(ii)the land has not changed ownership.
88ECPublication of report on exemptions and concession
(1)The Commissioner must publish on the Commissioner's website an annual report of the following information for the 12 month period to which the report relates—
(a)for each postcode in Victoria, the number of—
(i)exemptions granted under each of sections 88D, 88E and 88EA; and
(ii)concessions granted under section 88EB;
(b)the total amount of vacant residential land tax that was not payable because of the grant of the exemptions and the concessions referred to in paragraph (a).".
29Repeal of Schedule 2A
Schedule 2A of the Land Tax Act 2005 is repealed.
30New clause 21 of Schedule 3 inserted
After clause 20 of Schedule 3 to the Land Tax Act 2005 insert—
"21 State Taxation Acts and Other Acts Amendment Act 2023
(1)For the purposes of section 34C(2), the date of commencement of the construction or renovation of a residence on land is taken to be 31 December 2023 if—
(a)the land is not within a specified geographic area within the meaning of section 34D, as in force immediately before its repeal by the amending Act; and
(b)on 31 December 2023 the land was residential land within the meaning of section 34B(2).
(2)For the purposes of section 34C(2A), the date on which a residence on land became uninhabitable is taken to be 31 December 2023 if—
(a)the land is not within a specified geographic area within the meaning of section 34D, as in force immediately before its repeal by the amending Act; and
(b)on 31 December 2023 the land was residential land within the meaning of section 34B(2A).
(3)In this clause—
amending Act means the State Taxation Acts and Other Acts Amendment Act 2023.".
Division 2—Vacant residential land tax—unimproved land
31Definitions
(1)In section 3(1) of the Land Tax Act 2005 insert the following definitions—
"AVPCC means an Australian Valuation Property Classification Code based on the Valuation Best Practice Specifications Guidelines;
non-residential use means a land use described in an AVPCC in the following ranges—
(a)210 to 299;
(b)310 to 399;
(c)410 to 499;
(d)510 to 599;
(e)610 to 699;
(f)710 to 799;
(g)810 to 899;
(h)910 to 999;
non-residential zone means a zone listed in Schedule 2C;
planning scheme means a planning scheme in force under the Planning and Environment Act 1987;
zone means a zone under a planning scheme.".
(2)In section 3(1) of the Land Tax Act 2005, in the definition of year, for "calendar year." substitute "calendar year;".
32What is residential land?
(1)Section 34B(2)(b) of the Land Tax Act 2005 is repealed.
(2)After section 34B(2A) of the Land Tax Act 2005 insert—
"(2B)Land is also residential land for the purposes of this Division if the land—
(a)is within a municipal district of a Council listed in Schedule 2B; and
(b)is within a zone other than a non-residential zone; and
(c)is not solely or primarily used for or under development for a non-residential use; and
(d)is not land referred to in subsection (1), (2) or (2A).".
(3)After section 34B(3) of the Land Tax Act 2005 insert—
"(4)Despite subsection (2B), land is not residential land within the meaning of that subsection if the Commissioner determines that—
(a)the land is intended to be solely or primarily used or developed for a non-residential use; and
(b)there is an acceptable reason for the land not yet being used or developed in that way.
Example
There are delays in the development of the land that are outside of the owner's control.".
33New section 34BA inserted
After section 34B of the Land Tax Act 2005 insert—
"34BA When is land under development for a non-residential use?
(1)For the purposes of section 34B(2B)(c), land is under development for a non-residential use if—
(a)an application is made for a permit under the Planning and Environment Act 1987 in relation to the use or development of the land for a non-residential use; or
(b)a request is made under the Planning and Environment Act 1987 for an amendment to a planning scheme that would authorise a non-residential use of the land; or
(c)an application is made for a permit or approval under the Building Act 1993 in relation to the use or development of the land for a non-residential use.
(2)Despite subsection (1), the Commissioner may determine that—
(a)land that is not subject to an application or request described in that subsection is being developed for a non-residential use if the Commissioner is satisfied that other steps are being taken for that purpose; or
Example
Land that is subject to remediation or other works to prepare the land for development prior to an application or request being made under subsection (1).
(b)land that is subject to an application or request described in that subsection is not being developed for a non-residential use if the Commissioner considers that the application or request was made to obtain a reduction in, or exemption from, vacant residential land tax.
Example
The owner of land applies for a permit under the Planning and Environment Act 1987 in relation to the use or development of the land for a non-residential use but has no intention of using or developing the land in accordance with the permit.
(3)The commencement date of the development of land for a non-residential use is—
(a)the date on which the application or request referred to in subsection (1) is made; or
(b)in the case of land referred to in subsection (2)(a), a date determined by the Commissioner.".
34When is residential land vacant?
(1)After section 34C(2A) of the Land Tax Act 2005 insert—
"(2B)For the purposes of this Division, residential land referred to in section 34B(2B) is vacant in a tax year if, at the end of the year preceding the tax year, the land has satisfied the requirements in section 34B(2B) for a continuous period of 5 years or more.".
(2)After section 34C(4A) of the Land Tax Act 2005 insert—
"(4B)Despite subsection (2B), residential land referred to in section 34B(2B) is not vacant in a tax year if the Commissioner determines that a residence is to be constructed on the land and there is an acceptable reason for the construction not having commenced.
Example
There are delays in the development of the land that are outside of the owner's control.
(4C)For the purposes of assessing whether land has satisfied the requirements of section 34B(2B) for a continuous period of 5 years, any tax year in which there was a change of ownership in the land is taken to be a break in the period, unless the Commissioner considers that the land was transferred to obtain a reduction in, or exemption from, vacant residential land tax.
(4D)In making a determination under subsection (4B), the Commissioner must have regard to guidelines issued by the Treasurer under this section.
(4E)The Treasurer must issue guidelines for the exercise of the Commissioner's discretion under subsection (4B) and cause those guidelines to be published in the Government Gazette.
(4F)Guidelines issued under subsection (4E) are not a legislative instrument within the meaning of the Subordinate Legislation Act 1994.".
34AWhat is the rate of land tax?
For section 35(3)(a), (b) and (c) of the Land Tax Act 2005 substitute—
"(a)for residential land within the meaning of section 34B(2B)—1%; or
(b)for any other land—
(i)if the land was not liable for vacant residential land tax in the preceding tax year—1%; or
(ii)if the land was liable for vacant residential land tax in the preceding tax year but not the tax year preceding that tax year—2%; or
(iii)if the land was liable for vacant residential land tax in the last 2 preceding tax years—3%.".
35New sections 88F and 88G inserted
After section 88E of the Land Tax Act 2005 insert—
"88F Land contiguous to land used as a principal place of residence
(1)Land referred to in section 34B(2B) is exempt from vacant residential land tax if the land—
(a)is owned by the owner of PPR land; and
(b)is contiguous with the PPR land or separated from the PPR land only by a road or railway or other similar area across or around which movement is reasonably possible; and
(c)enhances the PPR land; and
(d)is used solely for the private benefit and enjoyment of the person who uses and occupies the PPR land.
(2)In this section—
PPR land means land referred to in section 54(1)(a), (ab) and (b).
88GLand that cannot be used or developed for residential purposes
(1)Land referred to in section 34B(2B) is exempt from vacant residential land tax if the Commissioner is satisfied that the land cannot be used or developed for residential purposes.
(2)For the purposes of subsection (1), the Commissioner may have regard to the following—
(a)any physical attributes of the land which render it incapable of use or development for residential purposes, including any of the following—
(i)the size and shape of the land;
(ii)the natural features of the land;
(iii)the environmental condition of the land;
(b)any matter which prohibits the lawful use or development of the land for residential purposes, including any of the following—
(i)the planning scheme which applies to the land;
(ii)a restrictive covenant which applies to the land;
(iii)an environmental action notice, improvement notice or prohibition notice issued in respect of the land under the Environment Protection Act 2017.".
36New Schedules 2B and 2C inserted
Before Schedule 3 to the Land Tax Act 2005 insert—
"Schedule 2B—Metropolitan Melbourne
Section 34B(2B)(a)
Banyule City Council
Bayside City Council
Boroondara City Council
Brimbank City Council
Cardinia Shire Council
Casey City Council
Greater Dandenong City Council
Darebin City Council
Frankston City Council
Glen Eira City Council
Hobsons Bay City Council
Hume City Council
Kingston City Council
Knox City Council
Manningham City Council
Maribyrnong City Council
Maroondah City Council
Melbourne City Council
Melton City Council
Merri-bek City Council
Monash City Council
Moonee Valley City Council
Mornington Peninsula Shire Council
Nillumbik Shire Council
Port Phillip City Council
Stonnington City Council
Whitehorse City Council
Whittlesea City Council
Wyndham City Council
Yarra City Council
Yarra Ranges Shire Council
Schedule 2C—Planning scheme zones
Section 3(1)
Commercial 2 Zone (C2Z)
Commercial 3 Zone (C3Z)
Comprehensive Development Zone (CDZ)
Farming Zone (FZ)
Green Wedge Zone (GWZ)
Green Wedge Zone A (GWAZ)
Industrial 1 Zone (IN1Z)
Industrial 2 Zone (IN2Z)
Industrial 3 Zone (IN3Z)
Port Zone (PZ)
Priority Development Zone (PDZ)
Public Use Zone (PUZ)
Public Park and Recreation Zone (PPRZ)
Public Conservation and Resource Zone (PCRZ)
Rural Activity Zone (RAZ)
Rural Conservation Zone (RCZ)
Rural Living Zone (RLZ)
Special Use Zone (SUZ)
Transport Zone (TRZ)
Urban Growth Zone (UGZ)
Urban Floodway Zone (UFZ)".
Division 3—Single COVID-19 debt temporary land tax surcharge where land assessed on a single holding basis
37Certain taxable land assessed separately
(1)In section 37(3) of the Land Tax Act 2005, after "land tax in" insert "Part 1, 3, 4 or 5 of".
(2)After section 37(3) of the Land Tax Act 2005 insert—
"(3A)There is to be added to the land tax assessed on the total taxable value of all land referred to in subsection (1) the amount (if any) determined by applying the applicable rate in Part 6 of Schedule 1 to the total taxable value of the land.".
38General land tax surcharge for trusts
After section 46A(6) of the Land Tax Act 2005 insert—
"(7)There is to be added to the land tax payable by the trustee under subsection (2) on the whole of the land subject to the scheme or trust the amount (if any) determined by applying the applicable rate in Part 6 of Schedule 1 to the total taxable value of the land if—
(a)in the case of a unit trust scheme that is not an absentee trust, the scheme has a nomination in force under section 46H; or
(b)in the case of a discretionary trust that is not an absentee trust, the trust—
(i)has a nomination in force under section 46H; and
(ii)does not have a nomination in force under section 46F.".
39Land tax for discretionary trust with nominated beneficiary
After section 46G(5) of the Land Tax Act 2005 insert—
"(5A)If the trust also has a nomination in force under section 46H, there is to be added to the land tax payable by the trustee under subsection (3) on the whole of the land subject to the trust the amount (if any) determined by applying the applicable rate in Part 6 of Schedule 1 to the total taxable value of the land.".
40Land tax surcharge for absentee trusts
After section 46IA(2) of the Land Tax Act 2005 insert—
"(2A)There is to be added to the land tax payable by the trustee under subsection (1A) or (1B) on the whole of the land subject to the absentee trust the amount (if any) determined by applying the applicable rate in Part 6 of Schedule 1 to the total taxable value of the land if—
(a)in the case of an absentee trust that is a unit trust scheme, the scheme has a nomination in force under section 46H; or
(b)in the case of an absentee trust that is a discretionary trust, the trust—
(i)has a nomination in force under section 46H; and
(ii)does not have a nomination in force under section 46F.".
41Land tax for absentee discretionary trust with nominated beneficiary
After section 46IE(6) of the Land Tax Act 2005 insert—
"(7)If the trust also has a nomination in force under section 46H, there is to be added to the land tax payable by the trustee under subsection (3) on the whole of the land subject to the trust the amount (if any) determined by applying the applicable rate in Part 6 of Schedule 1 to the total taxable value of the land.".
42New clause 1.7 of Schedule 1 inserted
After clause 1.6 of Schedule 1 to the Land Tax Act 2005 insert—
"1.7 Rate of land tax for land assessed under certain sections for 2024 to 2033
Despite anything to the contrary in this Schedule, the rate of land tax assessed under the following sections for each of the years from 2024 to 2033 is the rate set out in Table 1.5—
(a)section 37(3), if the owner of land would otherwise be subject to land tax at the rate set out in Table 1.6;
(b)section 46G(3)(a), if there is a nomination under section 46H in force;
(c)section 46G(4) for the variable R1, if there is a nomination under section 46H in force;
(d)section 46I(2);
(e)section 46IF(2A)(a).".
43New clause 3.7 of Schedule 1 inserted
After clause 3.6 of Schedule 1 to the Land Tax Act 2005 insert—
"3.7 Rate of land tax for land assessed under certain sections for 2024 to 2033
Despite anything to the contrary in this Schedule, the rate of land tax assessed under the following sections for each of the years from 2024 to 2033 is the rate set out in Table 3.5—
(a)section 37(3), if the owner of land would otherwise be subject to land tax at the rate set out in Table 3.6;
(b)section 46A(1), if there is a nomination under section 46H in force;
(c)section 46G(3)(b), if there is a nomination under section 46H in force;
(d)section 46G(4) for the variable R2, if there is a nomination under section 46H in force;
(e)section 46IF(2A)(b).".
44New clause 4.7 of Schedule 1 inserted
After clause 4.6 of Schedule 1 to the Land Tax Act 2005 insert—
"4.7 Rate of land tax for land assessed under certain sections for 2024 to 2033
Despite anything to the contrary in this Schedule, the rate of land tax assessed under the following sections for each of the years from 2024 to 2033 is the rate set out in Table 4.6—
(a)section 37(3), if the owner of land would otherwise be subject to land tax at the rate set out in Table 4.5;
(b)section 46IF(2)(a);
(c)section 46IE(3)(a), if there is a nomination under section 46H in force;
(d)section 46IE(4) for the variable R1, if there is a nomination under section 46H in force.".
45New clause 5.7 of Schedule 1 inserted
After clause 5.6 of Schedule 1 to the Land Tax Act 2005 insert—
"5.7 Rate of land tax for land assessed under certain sections for 2024 to 2033
Despite anything to the contrary in this Schedule, the rate of land tax assessed under the following sections for each of the years from 2024 to 2033 is the rate set out in Table 5.6—
(a)section 37(3), if the owner of land would otherwise be subject to land tax at the rate set out in Table 5.5;
(b)section 46IE(3)(b), if there is a nomination under section 46H in force;
(c)section 46IE(4) for the variable R2, if there is a nomination under section 46H in force;
(d)section 46IF(2)(b).".
46New Part 6 of Schedule 1 inserted
After Part 5 of Schedule 1 to the Land Tax Act 2005 insert—
"PART 6—DETERMINING COVID-19 DEBT TEMPORARY SURCHARGE IF LAND HAS BEEN ASSESSED ON SINGLE HOLDING BASIS
6.1Surcharge for land subject to rates of land tax set out in Parts 1 and 4 of this Schedule
(1)This clause applies if—
(a)an amount is being determined under section 37(3A), 46G(5A) or 46IE(7) in respect of land; and
(b)any of the land (other than land in respect of which a nomination under section 46H is in force) is subject to land tax at the applicable rate under Part 1 or 4 of this Schedule.
(2)The rate for determining the amount for each of the years from 2024 to 2033 is set out in Table 6.1.
Table 6.1
ItemColumn 1
Taxable value not less thanColumn 2
Taxable value less thanColumn 3
Rate of land tax surcharge1 0 50 000 Nil 2 50 000 100 000 $500 3 100 000 300 000 $975 4 300 000 $975 and 0×1% of the taxable value that exceeds $300 000 6.2Owners of land subject to rates of land tax set out in Parts 3 and 5 of this Schedule
(1)This clause applies if—
(a)an amount is being determined under section 37(3A), 46A(7), 46G(5A), 46IA(2A) or 46IE(7) in respect of land; and
(b)all of the land (other than land in respect of which a nomination under section 46H is in force) is subject to land tax at the applicable rate under Part 3 or 5 of this Schedule.
(2)The rate for determining the amount for each of the years from 2024 to 2033 is set out in Table 6.2.
Table 6.2
ItemColumn 1
Taxable value not less thanColumn 2
Taxable value less thanColumn 3
Rate of land tax surcharge1 0 50 000 Nil 2 50 000 100 000 $500 3 100 000 250 000 $975 4 250 000 $975 and 0×1% of the taxable value that exceeds $250 000
".
Division 4—Miscellaneous
47Absentee exemption requirements
In section 3BB(1) of the Land Tax Act 2005, for "6 months" substitute "12 months".
48BTR special land tax—owner of land
In section 50B(2) of the Land Tax Act 2005, in the formula set out in that subsection, in the variable BR, for paragraphs (a) and (b) substitute—
"(a)if the owner of land is an absentee owner and the relevant year is—
(i)2022 or 2023—3×275%; or
(ii)any year from 2024 to 2033—5×325%; or
(iii)2034 or any later year—5×275%; or
(b)if the owner of land is not an absentee owner and the relevant year is—
(i)2022 or 2023—1×275%; or
(ii)any year from 2024 to 2033—1×325%; or
(iii)2034 or any later year—1×275%;".
PART 11—REPEAL OF THIS ACT
49Repeal of this Act
This Act is repealed on 1 January 2027.
Note
The repeal of this Act does not affect the continuing operation of the amendments made by it (see section 15(1) of the Interpretation of Legislation Act 1984).
═════════════
ENDNOTES
1 General information
See for Victorian Bills, Acts and current authorised versions of legislation and up-to-date legislative information.
Minister's second reading speech—
Legislative Assembly: 5 October 2023
Legislative Council: 19 October 2023
The long title for the Bill for this Act was "A Bill for an Act to amend the Duties Act 2000, the Fire Services Property Levy Act 2012, the First Home Owner Grant and Home Buyer Schemes Act 2000, the Land Tax Act 2005, the Local Government Act 1989, the Property Law Act 1958, the Sale of Land Act 1962, the Treasury Corporation of Victoria Act 1992, the Valuation of Land Act 1960 and the Windfall Gains Tax Act 2021 and for other purposes. "
0
0
0