1Purpose
The purpose of this Act is to impose a windfall gains tax on the increase in the value of land resulting from a rezoning.
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Bill homepage (legislation.vic.gov.au)The purpose of this Act is to impose a windfall gains tax on the increase in the value of land resulting from a rezoning.
Section 1 and this section and Parts 7, 8, 10, 11, 12 (other than Divisions 2 and 6), 14 and 15 come into operation on the day after the day on which this Act receives the Royal Assent.
Part 9 and Division 2 of Part 12 come into operation on 15 April 2022.
The remaining provisions of this Act come into operation on 1 July 2023.
In this Act—
capital improved value has the same meaning as in the Valuation of Land Act 1960;
S. 3(1) def. of charitable land amended by No. 38/2023 s. 19(a).
charitable land means land, or part of land, that is—
owned by a charity; and
used and occupied by a charity exclusively for charitable purposes;
charity means—
a charitable institution; or
a person who holds land on trust for charitable purposes;
CIV1—see sections 12(a) and 13(1)(a);
CIV2—see sections 12(b) and 13(1)(b);
controlling interest—
in relation to a corporation—see section 23; or
in relation to a trust—see section 25(2);
corporation has the same meaning as in section 9 of the Corporations Act;
discretionary trust has the same meaning as in section 3(1) of the Land Tax Act 2005;
S. 3(1) def. of excluded rezoning amended by No. 38/2023 s. 19(b).
excluded rezoning means—
a rezoning between schedules in the same zone; or
a rezoning that causes land to be brought within the contribution area within the meaning of section 201RC of the Planning and Environment Act 1987; or
the first rezoning of land that was in the contribution area within the meaning of section 201RC of the Planning and Environment Act 1987 immediately before that rezoning; or
a rezoning that causes land that was not in a public land zone to be in a public land zone; or
a rezoning that causes land that was in a public land zone to be in a different public land zone; or
a rezoning that causes land to be in a zone declared under subsection (2)(a) to be an excluded zone; or
a rezoning of land that, immediately before the rezoning, was in a zone declared under subsection (2)(b);
general valuation has the same meaning as in the Valuation of Land Act 1960;
group means a group constituted under Division 4 of Part 3;
joint owners means persons who are owners of land jointly or in common, whether as partners or otherwise;
S. 3(1) def. of non-rateable leviable land amended by No. 16/2025 s. 22(6).
non-rateable leviable land has the same meaning as in the Emergency Services and Volunteers Fund Act 2012;
non-rateable non-leviable land has the same meaning as in the Valuation of Land Act 1960;
owner, in relation to land, means—
if the land is under the Transfer of Land Act 1958—the registered proprietor of the land within the meaning of section 4(1) of that Act; or
if the land is not under the Transfer of Land Act 1958—the holder of an estate in fee simple in the land;
Planning Minister means the Minister administering Part 3 of the Planning and Environment Act 1987;
planning scheme means a planning scheme in force under the Planning and Environment Act 1987;
public land zone means a public land zone under a planning scheme;
rateable land has the same meaning as in the Local Government Act 1989;
related corporation—see section 22;
related trust—see section 25(1);
rezoning means an amendment of a planning scheme that causes land to be in a different zone from the zone that it was in immediately before the amendment;
taxable value uplift—see section 10;
S. 3(1) def. of valuation authority repealed by No. 50/2024 s. 99.
* * * * *
value uplift—see section 11;
Victoria Planning Provisions has the same meaning as in section 3(1) of the Planning and Environment Act 1987;
WGT event means a rezoning other than an excluded rezoning;
windfall gains tax means tax imposed by section 6;
zone means a zone under a planning scheme.
The Treasurer, by notice published in the Government Gazette, may declare—
a zone to be an excluded zone for the purposes of paragraph (f) of the definition of excluded rezoning in subsection (1); and
a zone to be a zone for the purposes of paragraph (g) of the definition of excluded rezoning in subsection (1).
This Act is to be read together with the Taxation Administration Act 1997 which provides for the administration and enforcement of this Act and other taxation laws.
This Act binds the Crown in right of Victoria and, so far as the legislative power of the Parliament permits, the Crown in all its other capacities.
Nothing in this Act makes the Crown in any of its capacities liable to be prosecuted for an offence.
Windfall gains tax is imposed on land that is rezoned by a WGT event.
Note
Part 5 sets out exemptions and waivers from windfall gains tax.
Liability for windfall gains tax arises when the WGT event occurs.
For the purposes of this Act, a WGT event occurs when the rezoning that constitutes the WGT event takes effect under the Planning and Environment Act 1987.
Notes
The owner of the land when the WGT event occurs is liable to pay windfall gains tax on the land.
Note to s. 8 inserted by No. 38/2023 s. 20.
Note
The owner of land must not purport to require the purchaser under an option to purchase the land or a contract of sale of the land to pay an amount for or towards an assessed windfall gains tax liability. See section 10H of the Sale of Land Act 1962.
The rate of windfall gains tax is set out in the following table.
Item | Taxable value uplift | Rate of windfall gains tax |
1 | Not more than $100 000 | Nil |
2 | More than $100 000 but less than $500 000 | 62⋅5% of that part of the taxable value uplift that exceeds $100 000 |
3 | $500 000 or more | 50% of the taxable value uplift |
The taxable value uplift of land is the value uplift of the land less any deductions prescribed by the regulations.
The value uplift of land is determined in accordance with the formula—
where—
CIV1 has the meaning given in—
section 12(a) for rateable land and non‑rateable leviable land; and
section 13(1)(a) for non-rateable non‑leviable land;
CIV2 has the meaning given in—
section 12(b) for rateable land and non‑rateable leviable land; and
section 13(1)(b) for non-rateable non‑leviable land;
VU is the value uplift of the land.
For rateable land or non-rateable leviable land that is rezoned by a WGT event—
CIV1 is the capital improved value of the land contained in the valuation in force under Part II or IIA of the Valuation of Land Act 1960 (as the case may be) immediately before the WGT event occurs; and
CIV2 is the capital improved value of the land contained in a supplementary valuation under Part IIB of the Valuation of Land Act 1960.
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