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2024-25 Victorian State Budget wrap
- 8 May 2024
- by Tim Olynyk | Partner | Tax Advisory
- 7-minute read
On 7 May 2024, the Victorian Treasurer, Tim Pallas, handed down the 2024/25 Victorian State Budget.
Thank you for reading this post, don't forget to subscribe!As foreshadowed, the Budget was less about tax reform and more about reductions and deferrals of capital expenditure commitments so as to improve the State’s ‘bottom line’. The budget also focused on combatting workforce shortages through targeted spending measures.
While the 2024/25 State Budget is low on tax reform measures, the 2023/24 State Budget delivered last year contained many reform measures some of which are already operational and some of which will become operational shortly. These measures are:
- Subject to the bullet point below, from 1 July 2024, the payroll tax tax-free threshold will increase from $700,000 to $900,000 and from 1 July 2025, the threshold will then increase to $1 million.
- From 1 July 2024, there will commence to be a phasing out of the payroll tax tax-free threshold for large businesses with payroll in excess of $3 million.
- From 1 July 2024, stamp duty on the purchase of commercial and industrial properties will be gradually replaced with an annual property tax. The phase out of the stamp duty will only apply after the first sale transaction that occurs on the property after 1 July 2024. Read more about the changes to stamp duty on commercial and industrial properties.
- From 1 July 2024, the payroll tax exemption for ‘high student fee’ non-Government schools will be removed.
- From 1 January 2025, vacant residential land tax will commence to apply to residential properties that remain vacant for more than 6 months of the calendar year that are located outside of Greater Melbourne.
Additionally, those measures announced in the 2023/24 State Budget that have already commenced include:
- Commencing from 2024 land tax assessments, land tax tax-free thresholds have been reduced due to the introduction of a temporary COVID Debt Levy.
- Commencing from 2024 land tax assessments, the absentee owner land tax surcharge for landholdings held by foreign persons has increased from 2% to 4%.
- From 1 July 2023, businesses with wages exceeding $10 million are subject to a COVID Debt Levy of 0.05% on the amount of their wages exceeding $10 million. Businesses with wages exceeding $100 million are subject to a further 0.05% levy on the amount of their wages exceeding $100 million.
Contact us
If you have any further questions in relation to the 2024/25 Victorian State Budget or the measures introduced in the 2023/24 State Budget, please do not hesitate to contact your BG Private advisor, or contact our Tax Advisory Partner, Tim Olynyk, on +61 3 9810 0700 or t.olynyk@bgprivate.com.au
