Thursday, 19 June 2025
Bills
State Taxation Acts Amendment Bill 2025
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State Taxation Acts Amendment Bill 2025
Council’s suggested amendments
The DEPUTY SPEAKER (15:00): I have received a message from the Legislative Council agreeing to the State Taxation Acts Amendment Bill 2025 and suggesting amendments.
Ordered that suggested amendments be taken into consideration immediately.
Council’s suggested amendments considered:
1. Suggested amendment to the Legislative Assembly –
Insert the following New Clause to follow clause 16 –
‘16A Exemption continues if land becomes unfit for occupation
In section 58(2) of the Land Tax Act 2005, for “second” substitute “fourth”.’.
2. Suggested amendment to the Legislative Assembly –
Clause 24, lines 14 and 15, omit “12 months but less than 3 years” and insert “the prescribed period or, if no period is prescribed, any period,”.
3. Suggested amendment to the Legislative Assembly –
Clause 24, after line 15 insert –
‘(2A) After section 70F(2) of the Land Tax Act 2005 insert –
“(2A) The period (if any) prescribed for the purposes of subsection (2) must not exceed 12 months.”.’.
That this house makes the amendments suggested by the Legislative Council.
In speaking briefly to these amendments I would like to advise the house that the government introduced the build-to-rent tax concessions three years ago to expand the supply of secure, long-term options for renters, providing a realistic long-term alternative to home ownership. This enables Victorians to stay in one place to put down more secure roots, thereby providing social and community benefits. We do not see short-stay accommodation or very short term leases as meeting those policy objectives, and while we believe most providers are acting in good faith, we are also aware that some developments have advertised leases as short as three months. However, during consultations we have heard some concerns specifically around immediately introducing a 12-month minimum lease length. That is why the government brought this house amendment. Rather than introduce a minimum lease length of 12 months, it will allow the Treasurer to prescribe a minimum lease length of up to 12 months in regulations. This will provide more time to consult with industry and with renters about the genuine needs of renters seeking flexibility as well as those seeking stability and security. In the meantime this legislation will still require the build-to-rent operators to offer renters the option of a three-year lease in order to receive the tax concessions.
The opposition has made representations and engaged with government on this amendment, and I thank the member for Brighton for this engagement. The government agrees with the policy merit of allowing people more time to rebuild their damaged or destroyed homes following natural disasters without incurring land tax. The amendment extends the maximum period a person can claim an exemption from land tax when their home is uninhabitable due to natural disaster from two years with no evidence required to four years with no evidence required. The Commissioner of State Revenue can grant an additional two-year exemption if they are satisfied there is evidence the property is still available.
James NEWBURY (Brighton) (15:03): I feel terribly sad that there are not many members from the other side in the chamber now, because I am about to say something positive about the government. As the minister just said, these amendments deal with two matters, and I would like to start on the second matter raised by the minister in relation to expanding the land tax exemption to circumstances of natural disaster. Throughout debate, not only on the bill but in interaction with the Treasurer’s office and debate in the other place, there was strong consultation in relation to expanding the domestic violence exemption to include those people, those victims of natural disaster, who are moving out of their homes because of that natural disaster and should not be penalised for it.
On both issues, in relation to domestic violence and natural disaster, the opposition has strongly made representations to the government. In domestic violence I have been making personal representations to the Treasurer and the Premier and do acknowledge the fact that they have moved these amendments in law because of those representations. In relation to natural disaster, a number of members, including Wendy Lovell in the other place, who has been a very, very strong advocate for people who have suffered and been unfortunately taxed for the horrible circumstance they have been through, made representations, and she made me aware specifically of the need for reform. So when the domestic violence amendment came through this bill, we sought to amend it in this place, and the government has accepted that in the other place.
So can I acknowledge on both of these things that this is a circumstance where Parliament is doing its best work. The amendment that will pass very shortly will mean that domestic violence victims and victims of natural disaster are not paying tax for the circumstances they go through, and that can only be a good thing. I again acknowledge working with the government on both of these amendments. I think they are very important amendments that fix a structural unfairness in the system, so the coalition obviously will not be opposing them, but I also acknowledge the work of the government in working with me specifically to see this particular amendment go through.
On the second matter, the second amendment relates to build-to-rent requirements on leases. Industry feedback was very specific to the draft bill, which would have required a minimum 12-month lease. That did not quite hit the mark, and there were some unusual circumstances where 12 months might not suit. Industry provided that feedback to government, and I acknowledge that the government has understood the feedback from industry and has accepted the need to do that by way of regulation. Generally speaking it would be fair to say I am always sceptical of any decision made by regulation, but I do accept in this instance that the Treasurer’s office and the Treasurer will use that discretion sparingly, only to allow a timeline that actually works for the best outcome. Though it is not going to be a 12-month exact figure in legislation, there is the intent or the spirit of having some form of minimum requirement to ensure no, for want of a better phrase, gaming of the system as it is. We accept the government’s word that this power will be used sparingly.
I will finish on the point where I commenced – by saying that we are about to see two very important corrections at law made: those in relation to domestic violence victims and also victims of natural disaster. The coalition will not be opposing those of course, and I would hope that this is an example of the government and the opposition working together for the betterment of the community. We will support those amendments.
Ellen SANDELL (Melbourne) (15:08): As others have raised, there are two matters dealt with in these amendments. The Greens will be supporting one of the matters and opposing the other, so I would like to ask that they be split to enable us to vote for amendment 1 but against the other two amendments. I will just explain why. Amendment 1 to the State Taxation Acts Amendment Bill 2025, as the member for Brighton has talked about, is an amendment brought by the Liberals that will exempt people experiencing natural disasters from paying land tax if their home is not able to be rebuilt within a certain amount of time, if they are experiencing delays. That is a sensible reform and mirrors the one around family violence victim-survivors – that if they are unable to return to their home, they do not have to pay land tax. We do support that change to enable people who have suffered in a natural disaster to not have to pay land tax if there is a delay in building their home, so no problems there.
The other one I wanted to make a few comments about is around build-to-rent. Build-to-rent can play an important part in our housing mix, but it has been touted as a kind of new and novel housing model to create more affordable housing. Also it is supposed to mirror having the stability and the security of buying a house while renting, so kind of a different model – it is not quite the same as renting on the private market. You do not have to buy, but you still get the long-term stability of staying in one place. But unfortunately what we have seen is that most of these build-to-rent developments are a premium product. They charge above-market rents. They receive a lot of tax concessions from the government. In return they are supposed to provide this long-term stability and the security of long-term leases, but we are seeing that a lot of them actually are not.
This bill was supposed to correct some of that in a small way to say that in order to get tax concessions build-to-rent operators are supposed to offer a minimum 12-month lease. It is a pretty simple thing to have to offer, particularly when build-to-rent sells itself as being a place where you can stay long term. So you would have thought that they would already have built this into their model. But no, what has happened is once the government brought forward this pretty modest change just saying, ‘Come on, you’ve got to offer a 12-month lease,’ the industry, which, let us be clear, is the property developer lobby, came to government and said, ‘No, we can’t possibly have this,’ and asked the government to water it down and take that element out and replace it with just some discretionary powers for the Treasurer which she may or may not use. Given that it is a watering down of housing security, we do not support that.
The build-to-rent operators are also, it has come out recently, exempt from paying the open space levy. In my electorate and many other electorates there are build-to-rent operators that are not paying that open space levy and then depriving those residents of open space and depriving the council of the funds to build open space, which as we know is just something that everybody needs to live a good life. So there are a lot of things that need to be fixed when it comes to build-to-rent and the tax concessions.
I am also disappointed to see that one of the other amendments did not get up in the other place, which was the Greens amendment to cap the stamp duty concessions for off-the-plan new apartments that are valued at $1.6 million. We have seen these examples of $10 million, $20 million apartments getting stamp duty concessions and people saving over $1 million in stamp duty. They would have bought these apartments anyway, and these are just sweeteners. This is not good use of taxpayer money.
Tim Read interjected.
Ellen SANDELL: It is quite extraordinary, as the member for Brunswick just said, to see that the government is giving millions of dollars to the ultra wealthy to buy penthouse apartments. I do not think that that is good housing policy, so I am very disappointed that neither Labor nor the Liberals decided to support the Greens amendment to cap that at $1.6 million. If you look even at Kensington, where I live, an inner city electorate, you can buy a three-bedroom family apartment in some of these new developments for under $1.6 million, and that is right in the heart of the city. So $1.6 million we felt was a fair cap to set and say, ‘Yes, you can have a stamp duty concession for off-the-plan apartments up to $1.6 million.’ That enables first home buyers to get into the market and enables young families to buy a family apartment. But beyond that, really, we are looking at luxury apartments, and they should not receive those stamp duty concessions. So I am sad to see that those did not get up.
But as I mentioned, we will be supporting amendment 1, and we would love to see that split out from amendments 2 and 3 to enable the Greens to oppose the watering down of the longer lease terms in the build-to-rent provisions.
The DEPUTY SPEAKER: The minister has moved that the Assembly make the amendments suggested by the Council. The member for Melbourne has indicated they wish to vote differently on some suggested amendments. Accordingly, I will split the question. The first question is:
That the Assembly makes amendment 1 suggested by the Council.
Question agreed to.
The DEPUTY SPEAKER: The second question is:
That the Assembly makes amendments 2 and 3 suggested by the Council.
Assembly divided on question:
Ayes (79): Juliana Addison, Jacinta Allan, Brad Battin, Jade Benham, Roma Britnell, Colin Brooks, Josh Bull, Tim Bull, Martin Cameron, Anthony Carbines, Ben Carroll, Darren Cheeseman, Anthony Cianflone, Sarah Connolly, Chris Crewther, Jordan Crugnale, Lily D’Ambrosio, Daniela De Martino, Steve Dimopoulos, Paul Edbrooke, Wayne Farnham, Eden Foster, Ella George, Luba Grigorovitch, Sam Groth, Matthew Guy, Bronwyn Halfpenny, Katie Hall, Paul Hamer, Martha Haylett, Mathew Hilakari, David Hodgett, Melissa Horne, Natalie Hutchins, Lauren Kathage, Emma Kealy, Sonya Kilkenny, Nathan Lambert, John Lister, Gary Maas, Alison Marchant, Kathleen Matthews-Ward, Tim McCurdy, Steve McGhie, Cindy McLeish, Paul Mercurio, John Mullahy, James Newbury, Danny O’Brien, Michael O’Brien, Kim O’Keeffe, John Pesutto, Pauline Richards, Tim Richardson, Richard Riordan, Brad Rowswell, Michaela Settle, David Southwick, Ros Spence, Nick Staikos, Natalie Suleyman, Meng Heang Tak, Jackson Taylor, Nina Taylor, Kat Theophanous, Mary-Anne Thomas, Bill Tilley, Bridget Vallence, Emma Vulin, Peter Walsh, Iwan Walters, Vicki Ward, Kim Wells, Nicole Werner, Rachel Westaway, Dylan Wight, Gabrielle Williams, Belinda Wilson, Jess Wilson
Noes (3): Will Fowles, Tim Read, Ellen Sandell
Question agreed to.
The DEPUTY SPEAKER: A message will now be sent to the Legislative Council informing them of the house’s decision.