The State Budget 2023–24 has just been released, included in this budget is a number of announcements related to legislation administered by the State Revenue Office.
These measures have to be approved by the Victorian Parliament before they can start. You should only rely on the exact detail of the changes once the legislation is passed.
Please get in touch with us at Glance Consultants for more information or if you have any queries.
Measures:
- Land transfer duty (stamp duty) on commercial and industrial properties will be abolished and replaced with an annual property tax. From 1 July 2024, commercial and industrial properties will transition to the new system as they are sold, with the annual property tax to be payable from 10 years after the transaction.The annual property tax for commercial and industrial property will be 1 per cent of the property’s unimproved land value.
Expected start date: 1 July 2024
- COVID-19 debt — temporary payroll tax surcharge
A temporary payroll tax surcharge will apply on wages paid in Victoria by businesses with national payrolls over $10 million a year. A rate of 0.5% will apply for businesses with national payrolls above $10 million, and businesses with national payrolls above $100 million will pay an additional 0.5%.
The surcharge will apply for 10 years until 30 June 2033.
Expected start date: 1 July 2023
- COVID-19 debt — temporary land tax surcharge
A new COVID-19 debt temporary land tax surcharge will apply in addition to existing land tax from the 2024 land tax year for ten years.
Exempt properties — including your home — remain exempt from this surcharge. This means the value of exempt property is not included in your landholdings.
- General land tax rates
– For taxable landholdings between $50,000 and $100,000 — a $500 flat surcharge will apply
– For taxable landholdings between $100,000 and $300,000 — a $975 flat surcharge will apply
– For taxable landholdings over $300,000:
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- a $975 flat surcharge
- an increased rate of land tax by 0.10 percentage points.
- Trust surcharge land tax rates
– For taxable landholdings between $50,000 and $100,000 — a $500 flat surcharge will apply
– For taxable landholdings between $100,000 and $250,000 — a $975 flat surcharge will apply
– For taxable landholdings over $250,000:
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- a $975 flat surcharge
- an increased rate of land tax by 0.10 percentage points.
Expected start date: 2024 land tax year
- The absentee owner surcharge rate will increase from 2 per cent to 4 per cent and the minimum threshold for non-trust absentee owners will decrease from $300,000 to $50,000. (The threshold for land held by an absentee trust remains unchanged at $25,000.)
Expected start date: 2024 land tax year
- The land tax exemption for principal places of residence under construction or renovation will be expanded to provide the Commissioner of State Revenue with discretion to extend period by two years if builder goes into liquidation.
Expected start date: 2024 land tax year
- A new land tax exemption will apply to land protected by a conservation covenant with Trust for Nature.
Expected start date: 2024 land tax year
- A new land tax exemption will apply to land owned by an immediate family member and used as the home of an individual eligible to be a beneficiary of a special disability Trust, including where a special disability trust has not been established.
Expected start date: 2024 land tax year
- The deduction threshold for the land transfer duty special disability trust concession will increase from $500,000 to $1.5 million for principal place of residence transfers.
Expected start date: 1 July 2023
- A new land transfer duty concession will apply for the transfer of a home valued up to $1.5 million by an immediate family member to an individual eligible to be a beneficiary of a special disability trust.
Expected start date: 1 July 2023
- The land transfer duty pensioner exemption and concession thresholds will be aligned with the thresholds for first home buyers, at $600,000 and $750,000 respectively.In addition, eligibility will be assessed on the total value of the purchase.
Expected start date: Contracts entered into from 1 July 2023
- The payroll tax-free threshold will be increased:
- commencing 1 July 2024 — from $700,000 to $900,000
- commencing 1 July 2025 — to $1,000,000.
The deduction associated with tax-free threshold will begin phasing out for every dollar of wages above $3 million. This means businesses with wages above $5 million will not receive any benefit associated with the payroll tax-free threshold.
Expected start date: 1 July 2024
- Payroll tax exemption for high-fee non-government schools to be removed.
Expected start date: 1 July 2024
- Business insurance duty will be abolished over a 10-year period. The rate of duty, currently 10 per cent, will be reduced by 1 percentage point each year
Expected start date: 1 July 2024
- The wagering and betting tax rate will increase from 10 per cent to 15 per cent of net wagering revenue.
Expected start date: 1 July 2024
Please click the link below for the SRO announcement in relation to the budget overview:
https://www.sro.vic.gov.au/state-budget-2023-24-announcement
