This article is from the Australian Property Journal archive
STAMP duty on commercial and industrial properties in Victoria will be abolished, with the Allan government introducing new legislation to the state parliament.
The Commercial and Industrial Property Tax Reform Bill 2024 will see the upfront cost of stamp duty replaced with a Commercial and Industrial Property Tax, as initially announced in the Victorian Budget 2023/24.
“While others talk about productivity reform, we’re getting on with abolishing one of the least efficient taxes in the Federation to back Victorian businesses,” said Tim Pallas, treasurer.
“We’ve worked closely with industry to deliver these changes, supporting Victorian businesses to grow and expand faster without the burden of stamp duty.”
The government expects the commercial stamp duty reform to add thousands of jobs to Victoria’s economy and benefit the state’s economy by up to $50 billion in cumulative net present value terms over the coming 40 years.
From the start date, 1 July 2024, when a commercial or industrial property is transacted it will transition into the new system with stamp duty being payable a final time and the Commercial and Industrial Property Tax applying at a rate of one per cent of the property’s unimproved land value after 10 years.
Eligible purchases will also be able to access a transition loan provided by the Treasury Corporation of Victoria on commercial terms.
With existing stamp duty concessions for commercial and industrial properties, including the regional concession to still be available for the final stamp duty payment and existing land tax exemptions to apply to the Commercial and Industrial Property Tax.
“This bold move to stimulate commercial property investment signals the Victorian Government’s willingness to further the conversation about tax reforms in a way that can benefit business growth in Victoria,” said Paul Guerra, CEO at the Victorian Chamber of Commerce and Industry.
