The Andrews Labor Government is modernising duty and tax payments, creating a fairer and more equitable tax system.
The Victorian Budget 2017/18 will remove the stamp duty exemption for certain transfers of property between spouses, closing a loophole that is currently used for tax-minimisation by investors.
Property transfers between spouses and de facto partners will no longer be exempt from stamp duty from 1 July this year. Exemptions for the principal place of residence and for transfers following a relationship breakdown will remain in place.
These changes reflect the Labor Government’s efforts to support first home owners, not property investors, and bring Victoria’s policy on property transfers between spouses into line with NSW, QLD and WA.
In another measure, from 2019 property valuations will occur annually, rather than every two years.
As land tax is paid annually, it makes sense that it’s based on the most up to date valuations.
From July 1 this year, new passenger vehicles will start being charged the same duty rates as used passenger vehicles.
A small difference between the two duties currently exists to encourage Victorians to buy new locally-made cars.
But despite the best efforts of state and federal Labor Governments to keep building cars in Victoria, the Federal Liberal Government chased car companies out of the country, leaving no new cars being made in Victoria.
For new passenger vehicles, the duty will increase from $6.40 per $200 of the market value to $8.40 per $200 – an increase of 1 per cent on the price of new vehicles. The duty rate for new non-passenger vehicles will remain at $5.40 per $200.
Together, these measures will create a fairer and more equitable tax system in Victoria.
Quotes attributable to Treasurer Tim Pallas
“These changes modernise our tax system, help bring it into line with other states, and close tax loopholes.”
“Our focus is on supporting Victorians buy their first house, not people who own two, three, four or ten houses.”
“These changes are fair and equitable and will help ensure the Government continues to deliver the roads, schools, and services that matter to Victorians.”