Victoria: Homeowners who let property sit vacant for six months in a year to be taxed – but some claim it will make renting more expensive

Owners of homes left empty for more than six months of the year will be ordered to cough up extra tax, the Victorian Government has announced.

From January 1, homeowners across the state will be liable for vacant land tax (VRLT) if properties are vacant for more than six months in the calendar year.

The tax currently only applies to homes in Melbourne’s inner and mid-suburbs, with the state government identifying hundreds of apartments left vacant following a recent survey.

Authorities in Victoria recently targeted five apartment buildings in Melbourne and found 177 properties liable for the tax.

The investigation will now expand to thirteen more apartment towers across the city, as well as homes in Melbourne’s inner and middle suburbs.

The tax was introduced to help ease the housing crisis by encouraging homeowners to rent out their properties for at least six months of the year to avoid receiving a VRLT bill.

The longer a home is vacant, the more the tax rate increases, based on the number of consecutive years the home has been vacant.

Victorian Treasurer Tim Pallas said the Government knows Victoria needs more homes, and by cracking down on vacant properties they were easing the housing pressure that was being felt across the state.

“Expanding the vacant land tax will free up vacant homes for rent and sale, increasing supply and making housing more affordable,” he said.

But Shadow Treasurer Brad Roswell disagreed, saying that after a decade of Labor budgets, life was becoming increasingly difficult for Victorians and housing was becoming increasingly unavailable and unaffordable.

Victorian Treasurer Tim Pallas said the Government knows Victoria needs more homes, and by cracking down on vacant properties they were easing the housing pressure that was being felt across the state.

“Since Labor was elected they have introduced or increased 55 taxes, including around 30 taxes on land and property,” he said.

‘What Labor doesn’t seem to understand is that when they tax things they become more expensive and ultimately vulnerable Victorians are hit hardest.

‘A tax system that encourages properties to be in the long-term rental market, rather than continuing to punish landlords with higher taxes, is something that Labor should consider as an urgent issue.’

Authorities in Victoria recently targeted five apartment buildings in Melbourne and found 177 properties liable for the tax.

The investigation will now expand to thirteen more apartment towers across the city, as well as homes in Melbourne’s inner and middle suburbs.

Victoria’s shadow treasurer Brad Roswell said: ‘What Labor doesn’t seem to understand is that when they tax things they become more expensive and ultimately vulnerable Victorians are hit hardest’

Community Housing Industry Association Victoria chief executive Sarah Toohey said during the worst housing crisis Victorians have experienced in their lifetimes, we should not be in a situation where homes are sitting empty.

“Housing stress and homelessness are skyrocketing – more than 146,000 Victorian households are currently in need of social and affordable housing,” she said.

“We must do everything we can, including taxing vacant properties and boosting funding to build more community housing to ensure all Victorians can have a roof over their heads.”