By Bridie Byrne
A BARRAGE of community anger has ended with a major State Government backflip on a land tax that would force landowners off their property.
The draft legislation for the Growth Areas Infrastructure Contribution (GAIC) was released last Friday.
In a massive shake-up, people who buy and develop land in the Urban Growth Boundary (UGB) will pay the tax, not the owner choosing to sell.
The purchaser has an option to defer payment until the land is sold, sub-divided or developed.
The $95,000 per hectare tax would only be payable on the first transaction and does not apply to any parcel of land less than 0.41 hectares.
Planning Minister Justin Madden said the tax applies to those who are set to profit. “We believe this is the fairest way to help pay for the infrastructure needed by families who will move to some of Melbourne’s newest suburbs,” he said.
Many property owners told Star they feared they would have to sell their homes due to the strain of new tax burdens.
The GAIC was slated to affect all landowners that sold or subdivided their rezoned farming land.
It was to be backdated to 2 December last year, leaving some farmers already in debt.
But Taxed Out chairman Michael Hocking said the tax shift could cause house prices to plummet.
He said vendors would be forced to accept low offers as only developers could afford to pay the hefty tax.
