'Build on your vacant land or sell to someone who will'
Landowners across Victoria are being pushed to either build on vacant blocks or sell to someone who will, with the expansion of a vacant residential land tax.
A tax on vacant residential land in Victoria will be broadened in a push to force owners to develop their land or sell it to someone who will.
As parliament returned on Tuesday, Treasurer Tim Pallas announced the government would introduce legislation to expand the vacant residential land tax to all of Victoria, including regional areas.
Currently, the tax applies to residential properties across 16 inner and middle Melbourne councils that are unoccupied for more than six months a year.
Owners are annually charged one per cent of the property's improved value, meaning a vacant home with a value of $500,000 would be taxed $5000.
The change will start from January 2025.
The tax will also be expanded to include vacant residential land that has been unimproved for five years or more in established areas of metropolitan Melbourne from January 1 2026.
"We can't afford really to have vacant land in metropolitan Melbourne sitting idle year-on-year," Mr Pallas said in a speech at a Property Council event on Tuesday.
"Our clear message to landowners is to either develop the land or sell it to someone who will."
State government agencies will also be asked to justify why they are holding vacant land rather than putting it back into the marketplace.
"We are not putting in place a rule for landowners that we as a state are not going to deploy to ourselves," Mr Pallas said.
Vacant residential land tax currently nets the Victorian government about $6 million a year and is administered by the state revenue office.
"It doesn't massively advantage the budget," Mr Pallas said.
"What it does is tries to send a message to people who have un-utilised (sic) assets to think about utilising them and making them available for people to move into as homes."
It comes after the Victorian government last month announced an Australian-first, consumer-facing levy on short-term accommodation bookings with platforms such as Airbnb and Stayz.
The proposed 7.5 per cent levy was the only tax unveiled as part of Labor's long-awaited housing statement amid skyrocketing rents and weak supply.
From January, 860,000 investment, holiday home or business property owners will also pay $1300 a year on average in extra land tax as part of a 10-year $31.5 billion COVID debt levy revealed in the state budget.
Shadow Treasurer Brad Rowswell noted Mr Pallas first act as the newly sworn in minister for economic growth was an increased tax.
"Victoria is broke and Labor's only plan for 'economic growth' is to tax Victorians more," he wrote on social media.