Investors, holiday homeowners and commercial property holders will pay almost $5 billion of Victoria’s planned $8.6 billion COVID-19 debt levy over the next four years as a result of lower tax-free thresholds, higher rates and extra fixed payments on their land tax assessments.
However, the extra $4.74 billion the government is expecting to reap in financial year 2024 and the following three years will hit investors and owners of multiple properties who already face higher stamp duty payments, reflecting recent gains in land values.
The lower threshold would lift the number of landowners paying land tax by about 380,000 to 860,000, Mr Pallas said.Under the new system, the land tax payment for the owner of an applicable property with an unimproved land value of $1 million would rise from $2975 currently to $4650; on a $2 million property it would rise from $12,475 to $15,150; on a $5 million property the payment would increase from $78,975 to $84,650 and for a $10 million property it would increase from $206,475 to $217,150.
If they opt for fixed payments, no further stamp duty will be payable if they sell within that ten-year period, but an owner who sells will be obliged to meet their obligations on the outstanding payments.After the initial 10-year period, annual property tax will apply at a flat 1 per cent rate of a property’s unimproved land value.
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Victorian budget 2023 LIVE updates: Tim Pallas to detail COVID repayment plan in state budgetThe state budget will be handed down after 1pm on Tuesday. Victorians can expect new taxes and the promise of a $1b surplus within three years. Follow the blog live.
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