Allan dismisses widening of growth areas tax

November 21, 2023 BY

The Growth Areas Infrastructure Contribution only applies in seven Victorian councils, including Wyndham (seen here). Photo: FACEBOOK/WYNDHAM CITY

VICTORIAN Premier Jacinta Allan has dismissed as “speculation” claims the Growth Areas Infrastructure Contribution (GAIC) will be changed to include Geelong or any other booming municipalities in Victoria.

Established in 2010 by the state Labor government, the GAIC was set up to help fund infrastructure in metropolitan Melbourne’s expanding fringe suburbs.

The one off-contribution, sometimes called the growth areas tax, is associated with urban property developments such as buying, subdividing, and applying for a building permit on large blocks of land, and developers typically pass on this cost to the landbuyer.

The GAIC presently applies to only seven Victorian municipalities – Cardinia, Casey, Hume, Melton, Mitchell, Whittlesea and Wyndham – but the state Liberals earlier this month claimed the Allan Government was considering widening the GAIC to apply to other local government areas “or even all of Victoria”.

Shadow Minister for Home Ownership and Housing Affordability Evan Mulholland said such a move would “only make housing less affordable to more Victorians who already face the highest property taxes in Australia”.

“The record of the GAIC is one of policy chaos and failure. Instead of being used to deliver critical infrastructure in growing areas, half a billion dollars’ worth of funds have been hoarded for over two years in the GAIC to prop up the budget.

“Expanding this growth areas tax to all developments will further drive up the cost of housing while failing to deliver the critical infrastructure Victorian communities need.”

Speaking at Herne Hill Primary School during her first doorstop in Geelong as Premier, Ms Allan dismissed the suggestion that the GAIC could become applicable in the Geelong region.

“The speculation is just that; it’s just speculation,” she said.

“The focus is right now – and we indicated this in the Housing Statement – to bring forward the allocation of $400 million in the Growth Areas Contribution fund to invest in local infrastructure needs for those growth area communities.

“It doesn’t matter whether you’re here in Geelong, in the suburbs of Melbourne, my hometown of Bendigo and other country towns across the state, access to affordable housing is the number one issue.

“That is why through the Housing Statement, we are doing everything we can to not just build more homes, which is what we need to do, but also looking at how we support communities.”

Changing the GAIC or expanding it has been suggested before.

During his candidacy for the seat of Corangamite ahead of the 2022 federal election, investment banker and land economist Tom Roe said the City of Greater Geelong should demand the Victorian government introduce some form of GAIC and/or a rezoning tax on the city’s earmarked northern and western growth areas to pay for community infrastructure.

More recently, Infrastructure Victoria chief executive Jonathan Spear suggested in September of this year that the GAIC should be replaced with a Melbourne-wide charge.

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