Growth Areas Infrastructure Contribution
A new Law was passed by the Victorian Parliament on 23 May 2010 called the Planning and Environment (Growth Areas Infrastructure Contribution) Act 2010.
The new Law introduces a Tax or Contribution which is payable on all land within the new Urban Growth Boundary which is zoned for urban development. It will also apply to land brought into the Urban Growth Boundary for urban development in the future. The levy is $80,000.00 or $95,000.00 per hectare, depending on the date of which the land came within the Urban Growth Boundary.
There are different rates applicable to land brought into the Urban Growth Boundary between 2005 and 2006 and land brought into the Urban Growth Boundary after 2005/06. The purpose of the Tax or Contribution is to provide for State infrastructure, which is needed to support the development of new suburbs within the State of Victoria. It is important that anybody who owns land within the Urban Growth Boundary understands that payment of the Tax or Contribution is required to be made when the landowner settles the sale of the land, subdivides the land or applies for a Building Permit in respect to the land.
There are a range of circumstances in which no liability to pay the Tax or Contribution is incurred, such as family transfers, certain subdivisions and Building Permit matters.
Landowners should be aware that the Growth Area Authority has the power and will lodge a Notice on every Certificate of Title to land within the Urban Growth Boundary. The Notice will identify that the Growth Area Infrastructure Contribution may need to be paid if the land is purchased, transferred, subdivided or developed.
It should be noted that the Tax or Contribution is only required to be paid where land is purchased, transferred, subdivided or developed after 2 December 2008. The Tax or Contribution is only payable once and is not payable in respect to land having an area of less than .41 of a hectare or 1 acre.
The Growth Area Infrastructure Tax or Contribution for the 2010/11 financial year is $80,000 per hectare for land brought into the Urban Growth Boundary in 2005. The Growth Area Infrastructure Tax or Contribution is payable by the purchaser if the land is sold or in the event of a subdivision or building development, it is paid by the landowner.
If you own land which is subject to the Growth Area Infrastructure Contribution and you have purchased, subdivided or developed your land since 2 December 2008, it is important that you are aware that within 3 months of the commencement of the Act on 1 July 2010, you must either apply for a deferral of the Contribution, pay the Contribution, or apply to the Hardship Board of the Growth Area Authority for a payment plan.
The State Revenue Office intends to contact land owners who have a potential Contribution liability which occurred between 2 December 2008 and 1 July 2010. Landowners should be aware that some land is excluded from the Tax or Contribution if it cannot be developed due to significant constraints such as:
- Land in a flood way or subject to extensive flooding;
- Land containing endangered plants or animals which must be protected;
- Land is an electricity transmission line reservation;
- Land is a buffer to a quarry, abattoir, or other land use that is potentially hazardous or offensive.