Victorian Premier Jacinta Allan did not know about new land tax set to slug the state’s residents

Victoria’s Premier Jacinta Allan has debunked rumors she was unaware of her state government’s new land tax, claiming the state treasurer acted appropriately in announcing the initiative.

The Victorian government on Tuesday proposed a new tax on vacant residential land, in its first initiative since Dan Andrews left office as premier.

Treasurer Tim Pallas announced the surprise move at an industry breakfast just one day after Jacinta Allan was sworn in as the state’s new leader and her new cabinet was unveiled.

The Vacant Residential Land Tax, introduced to encourage Victorians to develop land to combat Australia’s housing crisis, will charge landowners one per cent of the total property price if it remains vacant for more than six months.

Sky News presenter Paul Murray has condemned Prime Minister Jacinta Allan as a ‘bad start to a new government’ after she was unaware of the tax and its introduction.

“It is reported that the Prime Minister was not aware that the decision had been made or that the decision had already been announced,” he said on Paul Murray Live on Tuesday.

Murray claimed ‘several’ staff were also unaware of the tax and called for the person responsible for briefing the Prime Minister to be fired.

“If only the Prime Minister didn’t know she had to fire the Treasurer if he’s now worrying about tax increases,” he said.

“If a bureaucrat has not told the Prime Minister’s Office, that person should also be fired.

“But that’s a bad start for a new government if the treasurer doesn’t even tell the prime minister that we’re raising taxes.”

However, during a press conference on Wednesday, Prime Minister Allan emphatically denied that she was unaware of the policy.

“I was absolutely aware of the proposals that Tim was putting forward because they had already gone through Cabinet when it came to Parliament this week,” Ms Allan said.

Asked whether the Treasurer had ‘jumped the gun’ when announcing the new land tax, Ms Allan said ‘no’, adding that Mr Pallas had acted appropriately.

“I understand the Treasurer went through this in detail yesterday afternoon,” Ms Allan said.

‘The treasurer rightly felt it was respectful to talk to people about decisions that had been taken and decisions that the government was planning to implement.’

Ms Allan said it is important to think about what land tax means for Australia’s housing crisis. “This decision is about doing everything we can to build more homes,” Ms Allan said.

“It doesn’t help anyone trying to find a house to buy, it doesn’t help anyone trying to find a bed to sleep in, having vacant properties sitting empty, having land in the bank and not having houses. build on.

“We must do everything we can to build more houses so that people have the dignity of having a roof over their heads at night.”

Currently, only properties in Melbourne’s inner and middle ring suburbs are subject to the tax, which is levied at one percent of the total property value.

However, from January 1, 2025, the vacant land tax will be extended to the entire state, including regional areas.

Mr Pallas said the move would encourage landowners to develop land as Australia faces a housing crisis.

“We cannot afford to have wasteland in metropolitan Melbourne sitting idle year after year,” Pallas said.

‘Our clear message to landowners is to develop the land or sell it to someone who wants to.

“Similarly, we are not setting a rule for landowners that we as a state are not going to apply to ourselves.

“We expect any government entity that owns land to justify exactly why they own that land and are not putting it on the market.”

The tax will also be extended again in 2026 to include residentially zoned land that has not been improved in Melbourne’s suburbs for more than five years.

The treasurer said the tax currently raises $6 million a year and would be used to “change behavior” rather than benefit the budget.

‘We would much rather not get $1 from taxes that is intended to change behavior. “We would rather see behavior change so we can get people into our homes,” he said.

Victorian shadow treasurer Brad Rowswell has since criticized the Labor government for the move.

“Victoria is bankrupt and Labor’s only plan for ‘economic growth’ is to tax Victorians more,” Rowswell said.

The change comes after the state government announced it would tax people in Airbnbs and other short-stay rental properties.

Former Prime Minister Andrews announced the new 7.5 per cent levy on short-term rental providers, which aims to reduce the number of households renting homes to holidaymakers to long-term renters amid the housing crisis.

There are more than 36,000 short-stay properties in Victoria, of which 29,000 are entire homes.