THE STATE Government has pushed back a vote on laws to expand taxes on empty homes and undeveloped land after failing to secure enough support.<\/p>\n
Reforms to Victoria’s vacant residential land tax were debated in the upper house last week before being put on ice.<\/p>\n
Labor needed the support of the Opposition or the Greens and two other crossbenchers to pass the bill through the upper house.<\/p>\n
But neither the Coalition nor the Greens back the legislation in its current form.<\/p>\n
The Greens are seeking concessions, including rent controls and a rethink on the Government’s housing statement plan to demolish and rebuild all 44 of Melbourne’s public housing towers by 2051.<\/p>\n
“The Greens won’t support an approach to housing that ignores thousands of people in financial distress and will make the housing crisis worse,” Victorian Greens leader Samantha Ratnam said.<\/p>\n
The Coalition wants Labor to withdraw the bill altogether, declaring the changes would unfairly penalise property owners and deter housing investment.<\/p>\n
“It’s a bad bill,” upper house deputy opposition leader Evan Mulholland told the chamber.<\/p>\n
Earlier, Premier Jacinta Allan said Treasurer Tim Pallas continued to lead negotiations with crossbench MPs.<\/p>\n
Victoria’s vacant residential land tax currently applies to homes unoccupied for more than six months a year across 16 inner and middle Melbourne councils.<\/p>\n
Owners are charged one per cent of the property’s total value a year, meaning one worth $500,000 would be taxed $5000.<\/p>\n
Under Labor’s proposal, the tax would be expanded statewide from 2025 along with existing exemptions for holiday homes and properties under renovation.<\/p>\n
Owners of residential land in established parts of metropolitan Melbourne who leave it undeveloped for more than five years would also be liable to pay the tax from 2026.<\/p>\n
“These changes are designed to stop property investors buying a house [and] leaving it vacant, trying to ride the capital gains growth on that property and preventing someone else from using it as a place that they can live,” Labor MP Ryan Bachelor said.<\/p>\n
About 900 Melbourne properties are subject to the vacant residential land tax at present, netting the state about $10 million a year.<\/p>\n
Treasury estimates expanding the tax statewide will pull in an extra $6 million in revenue a year for the state across another 600 to 700 properties.<\/p>\n
The change to undeveloped land is projected to capture 3000 properties, adding another $31 million to the state’s coffers annually.<\/p>\n
Independent analysis from Victoria’s Parliamentary Budget Office, requested by the Greens, indicated 10,000 properties would fall under the tax if homeowners were required to declare the occupancy status of their property every year.<\/p>\n
A similar compliance and enforcement regime is used to tax empty homes in the Canadian city of Vancouver.<\/p>\n
Mr Pallas insists other tax-related changes in the legislation will have no impact on revenue.<\/p>\n