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In 2009 many landowners have experienced massive increases in land tax payable.
It is often said that land tax is a tax on the wealthy members of society. However, land tax applies to many landowners who may in fact not be “wealthy” and has the effect of making those landowners poorer. By following some of the steps set out below, landowners and prospective landowners may be able to avoid paying unnecessary land tax.
What is Land Tax?
Land tax is an annual tax payable by landowners on Victorian property owned as at midnight on 31 December
in the previous year. Land tax is generally paid on all properties over a certain minimum threshold value.
Various exemptions exist for primary production land, a principal place of residence and other more specific exemptions.
Sliding Tax Rates
Similarly to income tax, the rate of land tax increases with the more land a landowner holds so that a landowner will pay a
higher rate of tax if a landowner holds more land. The scales of tax rates for 2009 are set out below:
2009 General Rates
| Total Taxable value of landholdings |
Land tax payable |
| < $250,000 |
Nil |
| $250,000 to < $600,000 |
$275 plus 0.2% of amount > $250,000 |
| $600,000 to < $1,000,000 |
$975 plus 0.5% of amount > $600,000 |
| $1,000,000 to < $1,800,000 |
$2,975 plus 0.8% of amount > $1,000,000 |
| $1,800,000 to < $3,000,000 |
$9,375 plus 1.3% of amount > $1,800,000 |
| $3,000,000 and over |
$24,975 plus 2.25% of amount > $3,000,000 |
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