Commercial & Industrial Property Tax Reform: Bill Introduced

The Victorian State Government is introducing the Commercial and Industrial Property Tax Reform Bill 2024, aiming to replace stamp duty on commercial and industrial properties with an annual tax known as the "Commercial and Industrial Property Tax (CIPT)". This reform is scheduled to take effect from July 1, 2024.

Under the new system:

- CIPT will be set at 1% of the property’s unimproved land value.

- Properties will enter the CIPT regime if a contract of sale is entered on or after July 1, 2024, and if 50% or more of the property transacts.

- Stamp duty will be payable on the transaction causing the property to enter the CIPT regime, but purchasers will have the option of accessing a government-facilitated transition loan.

- Once in the CIPT regime, no stamp duty will be payable on future transactions as long as the property remains for commercial or industrial use.

- CIPT will be payable annually starting 10 years after the property enters the regime, by the property owner on December 31 of each year, for as long as the property is used for commercial or industrial purposes.

The CIPT regime won't apply to properties primarily used for residential, community services, sport, heritage, or cultural purposes.

For additional information regarding this draft bill, please see the below link: