As set out in the recent controversial Victorian Budget, the State Taxation Acts Amendment Bill 2019 (Vic) contains amendments directly impacting any foreign persons or entities holding Victorian properties.
The amending bill is currently being debated in the upper house, and if passed, will mean that foreign persons or entities purchasing or holding Victorian properties will be faced with:
From 1 July 2019, an increase in foreign purchaser duty surcharge in Victorian residential property from 7% to 8%, giving a total top duty rate of 13.5%;
From the 2020 land tax year, an increase in foreign land tax (absentee owner) surcharge on all Victorian property (including commercial property) from 1.5% to 2%, giving a total top land tax rate of 4.25%.
It should be noted that only eligible Australian-based corporate land holders can apply for a treasurer’s ex gratia relief from the foreign surcharges outlined above.
If you have any questions, please contact one of the members of our specialist team: