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Victoria government to introduc...

Victoria government to introduce new property vacancy tax

Those looking to invest in property in Victoria will have to ensure the property is occupied, or face being landed with a penalty charge.

The state government is implementing a new policy in a bid to minimise the number of vacant houses in the area, which will come into effect from the 1st January 2018.

The policy will only be used to target those who leave their properties unoccupied for an 'unreasonable' amount of time. The fine, which will be levied as an extra tax, will be one per cent, multiplied by the capital improved value of the property. 

Tim Pallas, the treasurer to the state of Victoria, said he hopes the government does not make any money from the new policy, as its aim is to improve access to housing and not to raise funds. However, intentions aside, the government could generate millions from the 20,000 empty properties in the metropolitan Melbourne area. 

There are concerns that the policy will penalise those who are not keeping their property empty for financial gain. However, they have stated there will be exceptions - including for those who own holiday homes in the locality.

There has been a string of policy announcements made by the government in Victoria in a bid to tackle the housing crisis. Its primary aim is to help first-time buyers get their foot on the housing ladder. Another one of their key policies is to eradicate stamp duty for first-time buyers for those purchasing a property under $600,000.

All information provided is of a general nature only and does not take into account your personal financial circumstances or objectives. Before making a decision on the basis of this material, you need to consider, with or without the assistance of a financial adviser, whether the material is appropriate in light of your individual needs and circumstances. This information does not constitute a recommendation to invest in or take out any of the products or services provided by SMATS Services (Australia) Pty Ltd or Australasian Taxation Services Pty Ltd.

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