3 December 2025 (respondent) and 17 December 2025 (applicant)

KES v Commissioner of State Revenue (General Review) [2026] VCAT 75

1. Having regard to the highly sensitive nature of the medical and family evidence before the Tribunal, under s 80 of the Victorian Civil and Administrative Tribunal Act 1998 (Vic) ('VCAT Act'), the principal registrar is directed to amend the name of the applicant to 'KES'.
2. The assessments for the 2018, 2019, 2020 and 2022 land tax years, made on 22 July 2022, imposing vacant residential land tax on the property owned by the applicant in West Footscray, are varied to remit the penalty tax in full, but are otherwise confirmed.

1. In 1988, KES acquired a property in Stanhope Street, West Footscray ('Relevant Property') for use as her principal place of residence. However, as a result of domestic violence and threatened harm to her children, she moved out of the property in around 2003. She says that child protection prevented her from having access to her children, although she had to continue to pay child support.
2. From around 2007, KES began leasing the Relevant Property to third parties from time to time. She says that, in 2010, it was leased by a real estate agent to 'black market tenants' who damaged the property to such an extent that it was 'not habitable' and was left largely vacant until 2020, apart from use for storage of goods for a friend.
3. With effect from the 2018 land tax year, vacant residential land tax ('VRLT') has been imposed on 'residential land which is vacant' and located within specified municipalities (including the City of Maribyrnong) under s 34A of the Land Tax Act 2005 (Vic) ('LT Act').[1]
4. Following an investigation, on 22 July 2022, the Commissioner of State Revenue ('Commissioner') assessed KES to VRLT for the 2018 to 2020 and 2022 land tax years,[2] as well as to penalty tax ('Assessments').
5. In September 2022, KES objected to the Assessments, largely on the basis that VRLT did not apply on the bases that:
   • for the 2018 to 2020 land tax years, the Relevant Property was not habitable; and
   • for the 2022 land tax year, the Relevant Property was not vacant.
6. By letter dated 29 June 2023 ('Commissioner's Determination'), the Commissioner disallowed the objection insofar as it concerned VRLT.[3] However, the Commissioner determined to remit the penalty tax in full.
7. After the referral of this matter to the Tribunal, and with pro bono legal support, KES pursued an application for hardship relief under section 91 of the LT Act. However, that application was rejected.
8. KES continues to maintain the position as put in her objection. In support of her submissions, she has filed a large volume of evidence as to her personal circumstances between 1988 and 2023. While that material establishes that KES has encountered many difficulties in her life since the mid-1990s, much of it is irrelevant to the issues that the Tribunal needs to determine in these proceedings.
9. As the Commissioner submits, the only issues in this proceeding are whether the Relevant Property was:
   • 'residential land', as defined in section 34B of the LT Act, for some or all of the applicable land tax years; and
   • 'vacant', as defined in section 34C of the LT Act, for some or all of the applicable land tax years.
10. For the reasons which follow, I accept that during the 'Relevant Period' (being the 2017, 2018, 2019 and 2021 calendar years) the Relevant Property was residential land and vacant and, as such, confirm the Assessments insofar as the VRLT is concerned. However, I have varied the Assessments to remit the penalty tax in line with the Commissioner's Determination.

Overview of the relevant legislative framework

1. In Burke v Commissioner of State Revenue ('Burke'),[4] I set out an overview of the relevant aspects of the LT Act applicable to VRLT as follows:[5]

VRLT is imposed under section 34A of the Land Tax Act 2005 (Vic) ('LT Act'). However, unlike ordinary land tax, VRLT only applies to a subset of land in Victoria, being residential land which is vacant and, until recently, located within one of the identified municipalities (including the City of Maribyrnong which covers Yarraville).

Nevertheless, as explained in Zheng v Commissioner of State Revenue ('Zheng') [[2024] VCAT 1173 [15]]:

[w]hile the [VRLT] may seem to be a tax in its own right, it is clearly a species of land tax. Accordingly, it is to be assessed in the same way as any other land tax, with the tax for a given land tax year based on the 'total taxable value of all taxable land' held at midnight of the preceding 31 December.

Residential land is defined in section 34B(1) as land that 'is capable of being used solely or primarily for residential use'. For the reasons discussed in Zheng, the question of whether a particular piece of land is residential land is 'to be determined at 31 December of the calendar year preceding the tax year'.

The question of whether the land is 'vacant' is to be determined under section 34C. That section provides that land is vacant 'if it has not been used and occupied for a period (whether continuous or aggregate) of greater than 6 months in the year preceding the tax year' by the owner or a permitted occupant as their PPR, or under a 'genuine' lease or short-term letting arrangement.

While the requirement under section 34C, for land to be used or occupied as a person's PPR, has not been the subject of a previous decision in relation to VRLT, similar concepts are employed elsewhere in the LT Act and in other legislation, such as the First Home Owner Grant and Home Buyer Schemes Act 2000 (Vic). As such, decisions concerning similar legislation are helpful in understanding section 34C.

1. In the case of Zheng, which was referred to in the preceding passage, there was an issue as to whether land on which a historic house was located was 'residential land' in circumstances where the applicant had plans to demolish that house and a permit to do so, but had been thwarted by the intervention of the (then) planning minister. By 31 December 2019, utilities had been restored at the premises and the property had been leased to a third party. In those circumstances, I found that the property was land that 'is capable of being used solely or primarily for residential purposes' and, as such, residential land for the purposes of the VRLT. However, I noted a concession made by counsel for the Commissioner in that proceeding, namely:[6]

if the planning minister had not intervened and the demolition of Currajong House had commenced before the end of the 2019 calendar year, it is likely the Relevant Property would not be within the definition of residential land at the end of the year, such that no assessment of VRLT could be raised despite it having been vacant for most of the year.

1. As explored in more detail below, in this proceeding, the Commissioner has taken a different approach, submitting that the reference to land being 'capable of being used solely or primarily for residential purposes' is a reference to the 'capacity' of the land to be used for such purposes. Accordingly, so the submission goes, land that is zoned residential, but is undeveloped or has a house that is uninhabitable (except perhaps for reasons beyond the owner's control), remains residential land.

1. KES's evidence for this proceeding is set out in a 36-page document dated 7 March 2025 ('KES Witness Statement') and 64 associated exhibits.[7] KES explains that:[8]

[her] situation has been shaped by a series of unforeseen events that have spanned over three decades. These events have occurred [as] a consistent chain of reactions beyond [her] control, [and] have had significant, long-lasting effects on both [her] personal life and the 'VRLT Property'.

1. It is in that context that she requests VCAT to:[9]

cancel all VRLT levies assessed by the SRO and the Commissioner, taking into consideration the extraordinary circumstances and the unique challenges that have profoundly affected both [her] personal life and the 'VRLT Property'.

1. By way of broad summary, KES explains that she:[10]

initially purchased and resided at the 'VRLT Property' as [her] [principal place of residence] (PPR). However, due to domestic violence, [she] was forced to leave, and it deemed to be an investment property. It was tenanted but suffered severe damage in 2011. It remained uninhabited until the end of 2020. ...

1. KES then sets out a detailed chronology of events from 1998 to 2023.[11] It is only necessary to highlight certain points:

(a) 1988: KES purchased the property, which she used as her principal place of residence.

(b) 1994: She got married and she and her husband lived in the property. However, she experienced 'emotional and psychological abuse' from the start of the marriage, including threats to kill the children if she filed for divorce.

(c) 2003: She moved to another property she owns in Balwyn, initially with her children. However, after child protection got involved, the children were removed from her care and placed with their father, until returned by the Children's Court.

(d) 2004: KES commenced leasing the Relevant Property.

(e) 2005: Child protection again got involved and removed the children from KES which 'caused significant emotional harm to both [her] children and [herself]'. She 'spiralled into a deep depression and [became] suicidal'. She later 'developed Post-Traumatic Stress Disorder'.

(f) 2009: The Child Support Agency garnished KES's savings account. As she was unemployed, not receiving income support and had not lodged her income tax returns, the agency required her to pay child support at a 'higher estimate rate'.

(g) 2010: KES rented the Relevant Property through an agent, however as the tenants did not pay their rent for three months, she applied for and obtained a repossession order to evict the tenants. She discovered that they had 'caused significant damage to the [Relevant Property] rendering it uninhabitable'.

(h) 2012: She made an agreement with a third party (Mr Shannon) who agreed to lease the garage and part of the Relevant Property, but he pulled out 'upon discovering it was uninhabitable'.

During that year, she met her friend (Mr Petri) who had been a tenant of a flat in the same complex as another rental property she owns in Ballarat Road, Footscray ('Ballarat Rd Property').

(i) 2014: The City of Maribyrnong required KES to remove a brick fence at the front of the Relevant Property. She spent 'over 12 months working on the overgrown lawn in the front garden', which was 'delayed by [her] fear of entering the [Relevant Property] due to [her] past experiences of domestic violence'.

Late that year, KES became a carer to Mr Petri after he had a fall for which she received a carer allowance. As an occupational therapist required him to declutter his unit, KES 'let him store some of his belongings in the [Relevant Property], which was still uninhabited at the time'.

(j) 2017: KES was issued with intervention orders relating to a tenant at the Ballarat Rd Property, culminating in an arrest for stalking the tenant. This caused her 'immense distress and further deteriorated [her] mental health'.

During this time, Mr Petri's health 'worsened' and increased her associated caring obligations.

When the VRLT was introduced, she 'faced the challenge of not being able to repair the [Relevant Property] while also trying to comply with the new VRLT legislation'. That property 'remained unrepaired, uninhabited, and vacant' due to her 'past domestic violence experiences, and the lack of financial resources'.

(k) 2019: Mr Petri passed away. It took time to clean up the property as KES needed permission from his family to dispose of his belongings which had been stored at the Relevant Property.

(l) 2020: One of her sons moved into the Relevant Property. As she explains:[12]

At the end of 2020, the family member(s) approached me and requested to move into the [Relevant Property] rent-free, in exchange for taking care of the garden maintenance. For three months, we worked together to clean and repair the minor issues in the [Relevant Property] but we did not address the structural or plumbing problems. The major issues of the [Relevant Property] remained unresolved (Photos submitted to [the State Revenue Office]) were:

• All the pipes entering and exiting the Hot Water Unit (H.W.U.) were cut, resulting in no hot water supply.
• The shower recess lacked a cold-water tap, and fallen tiles exposed the plaster wall of the bedroom next to it. The water from the shower could damage the bedroom wall.
• All the water taps ... leaked into their cupboard underneath.
• The gas stove and oven were not working due to the electricity wires and gas pipe being cut.
• All the gutters were rotten, and rain poured down, damaging the fascia and eaves.
• No gas was connected to the [Relevant Property] because the gas pipes throughout had been cut.

To date, all of the above problems remain unchanged, except for the gutters, fascia, and eaves, which have been repaired.

The family member(s) came up with solutions by finding options to shower and wash clothes elsewhere, and used water bottles for drinking water, while continuing to live in the [Relevant Property].

(m) 2022: KES says that 'after the initial family moved out, a few months later, another family member moved into the property'.[13]

(n) 2023: She was diagnosed with multiple sclerosis and she was approved for support under the NDIS.

1. KES also explains that:
   • she did not have any photographs or documentation to establish the 'dilapidated conditions of the property' because neither she nor her family members were aware of the VRLT;[14]
   • the 'consumptions of utilities (electricity and water) were very low' due to the 'dilapidated condition of the property, including a lack of essential amenities, [such that] there was no cooking, washing and showering' and 'no gas supply, no space available for a modern, large fridge to fit into the built-in fridge enclosure, and water usage was limited to only flushing the toilet';[15] and
   • a real estate agent inspected the Relevant Property in July 2022 who advised that 'a significant amount of work would be required to make the property liveable, and even more extensive work would be needed to ensure compliance with the Residential Tenancies Act 1997 and the Regulations of April 2021'. [16]
2. In the Commissioner's Determination to disallow the objection, reliance was placed on a statement that KES had made in her objection that the Relevant Property was 'liv[e]able (with harsh conditions)'.[17] However, in her witness statement, she suggests that the Commissioner misinterpreted this statement by reason of the investigation involving 'two different set[s] of period[s]' namely:[18]
   1. 2018 - 2020, the [Relevant Property] was not liveable and there were no photographs of any rooms ... available.
   2. 2022, the [Relevant Property] was liveable with harsh conditions and photographs were available.
3. The Commissioner's counsel, Mr Chaile, indicated that the Commissioner did not take objection to KES's evidence as to the many difficulties she had faced in her life. She was only cross-examined, briefly, as to the people who had been occupying the Relevant Property since 2021. She explained that:

(a) Three people moved in and out of the Relevant Property, with only one of her sons, who had moved into the Relevant Property in May 2021 during the COVID-19 pandemic, remaining.

(b) The others did not stay because the living conditions were 'too harsh'. Her son stayed, despite the harshness, because he did not need to pay rent. She said he was 'very calculative'.

(c) Her son had not provided a statement because he 'could not deal with this matter' and 'wanted to forget everything' as reliving the past is 'torture to them mentally'.

(d) Her son had been looking for a property to move out but was still living at the Relevant Property now.

(e) Her son did not update his driver's licence to note the Relevant Property as his residential address, or register his details for the utilities, as he was 'trying it out' initially. She thought he had now done so, but she was unable to access and provide that evidence.

1. During the hearing, KES raised a concern that the Tribunal Book, which had been compiled by the Commissioner, did not contain all of the material she had provided to the Commissioner and wished to rely upon. I made orders at the conclusion of the hearing:[19]
   • requiring the Commissioner to provide a table identifying the documents he had received from KES as annexures to her reply submissions of March 2025 ('Applicant's Reply') and where they were included in the Tribunal Book; and
   • requiring KES to provide a copy of 'any exhibit referred to in the Applicant's Reply which she considers are missing or differ from the material in the Tribunal Book'.
2. On 15 December 2025, KES sent a letter to the Tribunal attaching two documents:
   • The first document is an affidavit affirmed by Dr Stella Kwong, a consultant psychiatrist, in July 2015 and appending a letter recording the number of consultations she had had with KES between 1993 and 2015 and outlining her 'psychiatric history' ('Kwong Affidavit'). It was suggested that this was Exhibit 15 to the Applicant's Reply.
   • The second document was a letter dated 8 December 2025 from a person identifying themselves as KES's son ('Son's Letter'), stating that he had resided at the Relevant Property 'since early 2021 on a rent-free basis' and suggesting that the house on the property 'was in a dilapidated condition and was not suitable for a person required to pay rent'. He goes on to claim that '[s]ince living there, [he has] carried out various improvements to the condition of the house, though not to the extent of structural repairs'.
3. By email the same day, the Commissioner submitted that:
   • KES had not provided the Kwong Affidavit with the Applicant's Reply (or otherwise), but that he did not object to the inclusion of that document in the material before the Tribunal.
   • The Son's Letter 'post-dates the substantive hearing' (i.e. 26 November 2025) and '[g]iven that the evidence has closed in the proceeding, and no party has requested or been given any opportunity to file further evidence ... [it] is inadmissible and should be excluded'.
4. I consider it appropriate to accept the Kwong Affidavit into evidence before the Tribunal because, even though it was not included with the Applicant's Reply, it is clear that KES intended to rely on that document in support of its case given that it was referenced in the reply (i.e. as Exhibit 15). That said, it is a document from 2015 that precedes the relevant years in issue (2017 to 2019 and 2021) and so it is unclear whether the diagnoses outlined therein remained relevant. It is notable, however, that Dr Kwong expressed the view that KES was 'recovering from her disabilities' by 2015 and, further, that she was 'now able to take over the control of her property portfolio and proven to be an astute businesswoman like she once was before marriage'. That view tends to contradict KES's evidence that she could not attend to any repairs required at the Relevant Property because of the mental health challenges she faced arising out of losing custody of her children following separation from her husband.
5. The Son's Letter is more problematic because it clearly falls outside the scope of the orders made at the conclusion of the hearing and represents 'new evidence' that KES seeks to rely upon. She requires leaves to provide new evidence.[20] However, a difficulty with granting such leave is that fairness would require that the Commissioner have the opportunity to test the evidence, meaning that:
   • the hearing would need to be reopened;
   • KES's son would need to be called to confirm the truth and accuracy of the matters he sets out in his letter; and
   • the Commissioner would need to have the opportunity to cross-examine him.
6. The relevance of the Son's Letter is also questionable, given he indicates that he has only resided in the property since early 2021, which post-dates all but the last of the land tax years in issue. Further, even if his observations about the condition of the property in early 2021 enable some inferences to be drawn about the state of the property in the relevant years, it could not support an inference that the house on the Relevant Property was 'uninhabitable'. Rather, at most, his evidence is to the effect the property was not 'suitable' for rental.
7. Lastly, while KES's son suggests that he has resided in the property since early 2021, his letter does not address the evidence before the Tribunal as to the limited utility usage during that year.
8. In the circumstances, I have determined that the letter from KES's Son should be given no weight, except to the extent that it is contrary to KES's case.

Did the Relevant Property meet the definition of Residential Land for the 2018 to 2020 land tax years?

1. As noted at the outset of these Reasons, VRLT is only imposed on 'residential land' that is vacant.[21] Residential land is defined in section 34B(1) as 'land that is capable of being used solely or primarily for residential purposes'.[22]

1. An issue that arises is whether the state of the Relevant Property during the relevant years impacts on whether it satisfies the above definition. The Commissioner contends that, having regard to the text, context and purpose of section 34B(1), there was 'no implied condition of habitability' for the 2018 to 2020 land tax years. Rather, the reference to land being capable of being used for residential purposes is a reference to its 'capacity to be used for the purpose'.
2. In support of this argument. the Commissioner referred to two criminal decisions:
   • A Supreme Court of Tasmania decision in R v Sender,[23] where Green CJ observed that:[24]

a document is "capable of being used" in connection with an application for approval or payment if it is of such a character that its use might in fact have the effect of advancing or supporting such an application.

• A New South Wales Court of Criminal Appeal decision in R v Le,[25] where Hulme J observed:[26]

Considered in isolation, the words in the definition of "listening device" "capable of being used to record or listen" are apt to refer either to a capacity of being used for the purpose of recording or listening, or alternatively, to a capacity of being used to actually record or listen.

1. Mr Chaile submitted that, 'by analogy', the ordinary meaning of land being capable of being used for residential purposes:
   • requires that the land have 'capacity' to be used for residential purposes; but
   • does not require that it is in fact used for that purpose, that any residence on the land is habitable or that someone resides in such a residence.
2. Mr Chaile suggested that, if the legislature had intended to limit the scope of the provision, the section would 'just refer to land used for residential purposes or on which there is a habitable dwelling'.
3. Mr Chaile submitted that this textual analysis is supported by the context for the legislation as gleaned from the Statement of Compatibility for the State Taxation Acts Amendment Bill 2017 tabled by the then Treasurer, which explained:[27]

The bill amends the Land Tax Act 2005 (the Land Tax Act) to provide for a new form of land tax, the vacant residential land tax (the vacancy tax). The vacancy tax has been introduced to encourage residential property owners currently withholding their vacant residential properties from the market to make them available for rent or sale.

1. Mr Chaile submitted that an 'interpretation that allows property to fall into disrepair and escape tax would defeat that purpose'. However, in response to questions from me, Mr Chaile accepted that:
   • If residential use of land were prohibited under planning rules, then it would not have the 'capacity' to be used for residential purposes and so would not be residential land within the definition.
   • If access to a residential property were prohibited due to public safety concerns, e.g. as is the case for residents affected by the McCrae landslide, that would be another situation where land would not have the 'capacity' to be used for residential purposes.
2. In this regard, Mr Chaile suggested that 'capacity' should be considered in the broader sense of whether someone could live on the land. By contrast, if a narrow view was taken, a person could 'land bank' a property on which there was no dwelling, which would be 'inconsistent with the scheme' that is intended to 'encourage landlords to make their property available'. He suggested the 'discrimen' (i.e. dividing line) was the 'degree of control exercisable by the owner'. That is, land would not be residential land if the 'inability to occupy or use the land for residential purposes is outside the control of the owner'.
3. In response to a question I raised as to whether 'financial capacity' is a factor to be considered when assessing the capacity to use and occupy land for residential purposes, Mr Chaile submitted the constraint would need to be objectively determined, rather than being based on 'what an owner can do in a particular case'.
4. It is relevant to observe that, for the 2018 to 2020 land tax years, section 34B(2) provided that land was also residential land if a residence was being constructed or renovated on the land, it had been capable of being used solely or primarily for residential purposes prior to the commencement of the construction or renovation and, on completion of the construction or renovation, the land would again be capable of being used solely or primarily for residential purposes.
5. In his submissions, the Commissioner suggests that section 34B(2) buttresses his interpretation on the basis that it 'provides a strong indication that the existence of a dwelling or a residence is not required for land to constitute "residential land" for the purposes of s 34B(1)'.[28]
6. With effect from the 2022 land tax year, a further category of residential land was included. Section 34B(2A) provides that land is also residential land if:

(a) there is a residence that is uninhabitable on the land; and

(b) the land is not land referred to in subsection (2).

1. At the same time as this change, section 34C (which deals with when a property is vacant) was amended to:
   • provide that land with an uninhabitable residence is vacant if, at 31 December of the year preceding the relevant land tax year, 'the residence has been uninhabitable for 2 years or more';[29] and
   • give the Commissioner discretion to treat such land as not being vacant if the Commissioner is 'satisfied there is an acceptable reason for the residence not having been made habitable'.[30]
2. Mr Chaile suggested that the introduction of section 34B(2A) supports the Commissioner's contention that there is 'no implied condition of habitability'. In this regard, he pointed to the observation of White J in Johnston v Jewry[31] that amendments to legislation 'may throw some light on the provisions under examination', particularly when a court or tribunal is confronted with ambiguity.[32]
3. However, Mr Chaile conceded that it was open to the Tribunal, in interpreting section 34B(1), to consider the impact of the introduction of both section 34B(2A) and the discretion in section 34C(4A) to treat land as not being vacant where the Commissioner is satisfied that there is a 'good reason' for it not being habitable.
4. In my view, the requirement in section 34B(1) that land 'is capable of being used solely or primarily for residential purposes' does require some assessment of the state of the land and any dwelling on it at the relevant time.
5. As indicated by the High Court in Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue:[33]

the task of statutory construction must begin with a consideration of the text itself. Historical considerations and extrinsic materials cannot be relied on to displace the clear meaning of the text. The language which has actually been employed in the text of legislation is the surest guide to legislative intention. The meaning of the text may require consideration of the context, which includes the general purpose and policy of a provision, in particular the mischief it is seeking to remedy.

1. The language employed in section 34B(1) is not technical and I consider it bears it ordinary meaning.
2. In this regard, the only relevant ordinary meaning of capable in the Australian Concise Oxford Dictionary is:[34]

having the ability or fitness or necessary quality for

1. When coupled with the use of the present tense, i.e. whether land 'is' capable of being used for residential purposes, I consider it requires an assessment of the ability of the subject land to be used for residential purposes at the relevant time (i.e. 31 December of the year preceding the land tax year).
2. If a dwelling constructed on land is not habitable at the relevant point in time, then in my view it is not apt to be described as 'capable of being used for residential purposes'. That construction is consistent with the Commissioner's concession in Zheng (see [12]).
3. Insofar as the Commissioner seeks to rely on criminal cases to support his interpretation, I would note the Court of Appeal's observation in Oliver Hume Property Funds (Broad Gully Rd) Diamond Creek Pty Ltd v Commissioner of State Revenue about the need for care when 'utilising cases which concern different legislation' to construe an Act 'since legislative provisions must be construed according to their own unique language, purpose and context'.[35] This is all the more so when one crosses the divide between:
   • criminal and civil law; and/or
   • real property (i.e. the Relevant Property in issue in this case) and personal property (i.e. the documents and devices considered in the criminal cases).
4. The context also supports an interpretation of section 34B(1) that pays regard to whether any dwelling on land is inhabitable.
5. In this regard, it is important to bear in mind that section 34B(2) specifically treats land as residential land if it is under renovation provided that it was capable of being used for residential purposes prior to the commencement of the renovation. That provision would be unnecessary if section 34B(1) already captured the land because there was always the 'capacity' for it to be used for residential purposes, i.e. by not starting or quickly finishing any renovation.
6. Similarly, the introduction of section 34B(2A), which expressly deals with the habitable state of any dwelling on the property, would be unnecessary if an uninhabitable dwelling was already within section 34B(1). Further, the discretion vested in the Commissioner under section 34C effectively allows for the dividing line that Mr Chaile contends is somehow implicit in section 34B(1).
7. Lastly, as to purpose, I note Mr Chaile references a concern about 'land banking'. However, that phrase is not employed in the Statement of Compatibility he mentioned. Rather, it is a phrase that generally arises in the context of the primary production exemption from land tax.[36]
8. I accept that an interpretation that allows for consideration as to whether a property is habitable can be seen to be somewhat inconsistent with the purpose of the legislation 'to encourage residential property owners ... to make [their residential properties] available for rent or sale'. However, it could not have been the intention of the legislature to tax landowners where the inability to rent a property was due to circumstances beyond their control. Without an exemption or, at least, some discretion to relieve a landowner in such circumstances (as now found in section 34C), there would be considerable uncertainty for landowners, such as those discussed at [35] above.
9. In these circumstances, I do not consider that consideration of the purpose of the VRLT supports a broader interpretation of section 34B(1) than can be supported by reference to the text and context as explained above.

Relevant Property was capable of being used solely or primarily for residential purposes

1. On KES's own case, her son moved into the dwelling on the Relevant Property in either late 2020 (see [17(l)]) or early to mid-2021 (see [20(a)] and [26]), with the condition of the property being 'liveable with harsh conditions' (see [19]).
2. It is presumably based on this evidence that the Commissioner submitted that he 'does not understand [KES] to dispute that the [Relevant Property] was capable of being used for residential purposes from the 2020 calendar year onward'.[37]
3. Having regard to these matters, I am satisfied and find that the Relevant Property was capable of being used solely or primarily for residential purposes as at 31 December 2021 (for the 2022 land tax year).
4. In relation to the 2018, 2019 and 2020 land tax years, the Commissioner submits that the dwelling on the Relevant Property was habitable.[38]
5. The Commissioner's position was originally based on a letter that KES sent the Commissioner in July 2022 in which she suggested 'the property is liv[e]able but with extremely harsh conditions'.[39]
6. In light of that 'concession', the Commissioner contended that 'it is sufficient [for the purposes of section 34B(1)] that the relevant dwelling or residence be habitable, even if inhospitable or "harsh".'[40] Or, to put it another way, there is no 'minimum standard of habitability that must be met in order for the definition of "residential land" to be met'.[41]
7. As already noted (at [19]), KES has since clarified that her reference to the property being liveable but with harsh conditions applied to the 2022 land tax year, but not the earlier years.
8. In closing, Mr Chaile indicated that the Commissioner 'accepts that [the July 2022 letter] could be interpreted that way' and, in any event, the Tribunal does not need to rely on any such concession. This is on the basis that there is no photographic or other evidence as to the habitability of the property during the relevant period 2017 to 2019.
9. To the contrary, the only photos of the property in the Tribunal Book are from 2011 and 2022 respectively.[42] Mr Chaile observed that, in Burke,[43] the Tribunal concluded that there was 'no evidence of the property [in that case] being uninhabitable as at 31 December 2018' in circumstances where the only photos of damage to the property were taken after the relevant land tax years and the taxpayer gave evidence that the theft (of copper piping) that made it uninhabitable occurred in 2021.[44] He submitted that the Tribunal was 'plainly correct' to conclude that, in order to discharge its onus of proof, a taxpayer would need to produce 'contemporaneous evidence' that the property was not habitable.
10. Mr Chaile submitted that the fact the onus of proof is placed on a taxpayer is 'not harsh' given the Commissioner 'cannot independently investigate the state of premises at any particular time'. He referenced the observations of Croft J in CDPV Pty Ltd v Commissioner of State Revenue[45] as to the importance of the onus in land tax cases.
11. In her reply, KES explains the lack of photographic or other evidence on the basis that, at the time, the Relevant Property was the 'last thing on [her] mind' because she had been 'bombarded with difficulties in her life', including her health and caring for Mr Petrie. She also pointed to the following aspect of her reply submissions (and the supporting evidence provided):[46]

In 2014, Maribyrnong Council served me a notice requiring the removal of the brick fence at the street front of the 'VRLT Property' due to safety concerns (EXHIBIT 26 'Maribyrnong Council Email dated 02.10.2014' and 'Notice dated 21.11.2014'). After the fence was removed, I spent over 12 months working on the overgrown lawn in the front garden (EXHIBIT 27 "Front Garden of the VRLT Property dated 20.12.2015"). This work was delayed by my fear of entering the 'VRLT Property' due to my past experiences of domestic violence, which made it difficult for me to use the toilet, kitchen, or other facilities. As a result, I could only work short hours on any given day.

1. KES asked, rhetorically, how could she be expected to take photos of the Relevant Property when she could not even 'handle' going to the property.
2. KES also pointed to her evidence that a Mr Shannon[47] had 'expressed interest in leasing the garage', but 'upon discovering it was uninhabitable, he terminated the signed contract'.[48] She submitted that this was 'evidence that [the Relevant Property] was not liveable'.
3. In my view, KES has failed to discharge the onus placed on her to establish that the property was not habitable for the 2018 to 2020 land tax years. While there is no 'special burden' beyond the civil standard of the balance of probabilities,[49] KES's testimony has to be assessed in the context of all the evidence.
4. On KES's case, the property was uninhabitable from sometime in 2010 through to when her son took up occupation in late 2020 or early to mid-2021. However, that evidence is not supported by the three photos taken in 2011. In that regard, I observe:
   • The first photo[50] shows a fully furnished living room with reclining chair, large television and what appears to be a guitar. It is true that the photo includes around 10 bottles of what appears to be water, which is, perhaps, consistent with some impact on the water supplies at the property.
   • The second photo[51] is of the kitchen. Again, it appears to be furnished (for example, the photo includes an oven, a microwave and another less identifiable appliance above the microwave). Above the sink there is a row of seven plastic milk bottles. It is clear they do not contain milk, although it is less clear that they contain water. However, even if they do contain water (and so, again, are consistent with a lack of water supply through the tap), it is significant that to the right of the sink is a stack of dishes and cookware in a drying rack. In other words, even if there was a lack of water supply, it did not impede whomever may have been using the property at the time from cleaning dishes.
   • The third photo[52] is of a furnished bedroom. The bed has linen and looks like it has been made. There is a portable column heater. There are plants in the window.
5. In my view, those photos are more consistent with the dwelling on the Relevant Property still being habitable in 2011, contrary to KES's evidence (see [17(g)]) that tenants had caused significant damage to the property and rendered it uninhabitable in the previous year.
6. In terms of her evidence regarding the arrangements with Mr Shannon, the Tribunal Book includes a document headed 'Agreements made by KES and Mr Shannon [surname redacted] To lease the garage in [the Relevant Property]'.[53] The document is signed by both parties and dated 5 May 2012. The basic agreement is set out in clause 1, which states that Mr Shannon:

will have use of the double garages to park his vehicle free of charge in exchange to provide his services to look after the entire garden of [the Relevant Property] to the basic condition. (The lawns to be kept as neat and tidy and short as possible and all the weeds are under controlled, destroyed and removed).

1. It also provides:
   • at clause 5, that Mr Shannon 'will not use any water until all the taps in the front and back garden are replaced. The water meter is currently reading at 2528.50'; and
   • at clause 6, that Mr Shannon 'will not enter the house under any circumstances or by any means or reasons'.
2. The agreement does go on to provide some terms (from clause 7 onwards) for Mr Shannon to lease part of the house from 'no later than 8th August 2012', but provides that these additional terms 'may be applied in the future upon both parti[e]s['] agreement' and contemplates 'a new lease will be prepared at the commencement of leasing'.
3. That Mr Shannon may have decided not to progress from the garage arrangement to a rental of part of the house does not evidence that the reason he did so was because of discovering it was uninhabitable. Viewed in context, it may well have been because of the various restrictions that KES placed on his use of the house.
4. It is certainly surprising that, if the property was as damaged as KES suggests (see [17(l)]), this was not mentioned in the agreement at all.
5. Turning to the 2022 photos, these show:
   • The first photo[54] is of a carpeted living area with a lounge suite, art on the walls and a display cabinet with things inside.
   • The second photo[55] is of a table which appears to be used as a desk with a screen that might be for use with a laptop (or could be a small television). In the background is a large cabinet stacked with various objects as you might expect in a family home. There are seats, a fan, some art and a light stand.
   • The third and fourth photos[56] are copies of the first and second photos from 2011.
   • The fifth photo[57] is a more recent and close up picture of the kitchen.[58] There is still a microwave and above it what appears to be a toaster oven (which may be the same object as from 2011). There is also a kettle to the left of the microwave. There are still empty plastic milk bottles in the window sill and it does appear that these contain water. It is evident, for example in terms of a plate of vegetables in front of the microwave and an empty coffee cup to the right of the sink, that the kitchen was being used by someone at the time.
   • The sixth photo[59] shows a bathroom. In front of the bath, there are five large plastic water bottles and eight plastic milk bottles that appear to contain water.
   • The seventh photo[60] is a copy of the third photo from 2011.
   • The eighth to tenth photos[61] are images of the hot water unit showing that it is disconnected.
   • The eleventh photo[62] appears to show a connected hot water unit, although the pipes look damaged or corroded.
   • The twelfth photo[63] is a photo of a shower, with the taps for controlling the water hanging in a bag.
6. I accept that these photos are consistent with a lack of hot water connected to the house. However, they are also consistent with a house that is liveable, but harsh. Importantly, when considered with the 2011 photos, they appear to show that the house has remained fully furnished between 2011 and 2022, which is consistent with the property having remained 'liveable but with harsh conditions' throughout the period.
7. Having regard to these matters, I am satisfied and find that the Relevant Property was capable of being used solely or primarily for residential purposes as at 31 December 2017, 2018 and 2019 (for the 2018, 2019 and 2020 land tax years).

Was the Relevant Property vacant for more than six months in relation to the 2022 land tax year?

1. The Commissioner submits that there is 'no dispute between the parties that the [Relevant Property] was vacant for the 2018, 2019 and 2020 years' and, as such, the Tribunal should determine it was vacant within the meaning of section 34C of the LT Act for those years.[64]
2. As the Commissioner observes,[65] that the property was vacant for these land tax years is consistent with KES's assertion, throughout his investigation and maintained at the hearing, that the relevant property was uninhabitable.
3. As there is no evidence to suggest that anyone resided in the Relevant Property at any time (and certainly not for more than 6 months) in the 2017, 2018 and 2019 calendar years, I am satisfied and find that it was vacant, within the meaning of section 34C for the 2018, 2019 and 2020 land tax years.

1. For the 2022 land tax year, the Commissioner submits the question that the Tribunal needs to consider is:[66]

whether it is satisfied - having regard to the totality of the evidence and on the balance of probabilities - the [Relevant Property] was used and occupied by a permitted occupant as his or her principal place of residence for the 2022 year. The applicant contends that the [Relevant Property] was not vacant for the 2022 year because a family member was using and occupying [it] as their principal place of residence. Despite this contention, the Commissioner submits that the Tribunal cannot be satisfied on the balance of probabilities that any person, let alone a family member of the applicant, used the [Relevant Property] as their principal place of residence in the 2022 year, applying the Ferrington principles [being the principles set out in Re Chief Commissioner of State Revenue and Ferrington[67]].

1. This is based on the following four matters:
   • the low water usage throughout 2021;
   • the low level of electricity usage;
   • that the Relevant Property was not recorded by any relevant authority (principally the Australian Taxation Office and VicRoads) as any person's residential address; and
   • the absence of any independent or corroborating evidence as to the arrangement with her son for the use and occupation of the Relevant Property.
2. In relation to water usage, the Commissioner highlights that City West Water recorded:[68]

(1) there was 0 KL of water usage between 10 March 2017 to 4 December 2020;

(2) there was 3KL of water usage between 5 December 2020 to 12 March 2021; and

(3) there was 0 KL of water usage between 13 March 2021 and 7 March 2022.

1. The Commissioner submits this level of usage is:[69]

inconsistent with the degree of permanence expected of a place that is a person's principal place of residence for there to be such little water usage. It is inconceivable that a person could have been in occupation of the Land in the relevant period and yet not have used a toilet at the property during that time, which defies both logic and common experience. The low level of water usage at the Land is inconsistent, and militates against, the use and occupation of that land.

1. The Commissioner contends that this is buttressed by the evidence of the electricity usage of between 0.72 kWh per day in late 2020 to a peak of 1.89 kWh per day for April to August 2021, which 'falls short, indeed well short' of the benchmark which is 7.4kWh per day for a one-person household.[70]
2. In closing, Mr Chaile added that KES's evidence about how her son lived, e.g. as to using bottled water, displayed a level of transience in his occupation which is not consistent with the fourth Ferrington principle. However, given the absence of hot water at the Relevant Property, in closing, Mr Chaile suggested that the Tribunal's focus should be on the low electricity usage, rather than the water usage.
3. In closing KES suggested that, initially, her son was 'trying out' the Relevant Property but he 'eventually decided to stay permanently'. She suggested that the low water and electricity usage could be explained on the basis that he 'only sleeps there, goes to work and showers at the gym'. She added that the property was 'very insulated' so there was no need for a heater in winter or air conditioning in summer.
4. KES submitted that her son has failed to make a statement because he is 'very immature', thinks that nobody would believe him because of the 'family tragedy' and, as the Relevant Property is part of his inheritance, he would prefer to 'leave [the VRLT] as is'.
5. The Commissioner submits that, if taken at face value, KES's explanation for the low water and electricity usage 'establish[es] a lack of the permanence that is required for a place to be characterised as a person's principal place of residence under the Ferrington principles.[71]
6. In Burke, I accepted that the Ferrington principles are relevant to an assessment of whether land is vacant for the purposes of section 34C of the LT Act.[72]
7. When applying the Ferrington principles, regard is had to the usage of utilities and, where that is demonstrably below the relevant benchmarks, an assessment needs to be made as to whether such use as is made of the property is consistent with requisite degree of permanence necessary to establish a property as a person's principal place of residence.
8. A difficulty for KES in satisfying her onus of proof is that she did not call her son to give evidence as to his circumstances. To the extent that she sought to explain the low water and electricity usage by reference to her son's activities (e.g. that he would shower elsewhere), that is hearsay evidence. Further, it is not corroborated by:
   • her Son's Letter which, as already noted (see [27]), does not address these matters; or
   • the photographic evidence, particularly the photo of the bathroom and the containers of water (see [78], commentary on the sixth photo) which, in the absence of evidence to the contrary, can be inferred to have been filled onsite (i.e. using tap water which ought to have registered in the water usage) and rather suggests that he does in fact bathe at the property at least some of the time.
9. Similarly, KES's evidence as to the insulation at the Relevant Property negating the need for a heater in winter is contradicted by the photo of the bedroom which included a bar heater (see [71], commentary on third photo). As it was portable, it can readily be inferred that it is operated using electricity (as opposed to gas). In that light, I cannot accept her evidence as to the insulation negating the need for air conditioning in summer.
10. While I accept that there is some evidence of KES's son using the Relevant Property (e.g. the photo of the kitchen with a plate of vegetables and cleaned pots and dishes), the low utilities usage is not consistent with the property being his principal place of residence. While there is no evidence of what other properties he may have available to him, it seems likely that he spends much of his time at other locations.
11. For these reasons, I am not satisfied that the Relevant Property was occupied by KES's son as his principal place of residence for at least six months in 2021. Accordingly, I am satisfied and find it was vacant for the purposes of section 34C of the LT Act for the 2022 land tax year.

1. In her letter of 15 December 2025 (see [22]), KES submits that the VRLT 'should not be applied to [her] property retrospectively' and that the imposition of that tax is 'unjust in light of the severe family violence and significant health challenges [she] was facing'. She ultimately asks that VCAT 'waive' the debts for the VRLT.
2. KES does not identify any basis on which she contends that VCAT can waive the debt.
3. It is important to bear in mind that, as previously noted (at [7]), she has already unsuccessfully pursued relief from the Land Tax Hardship Relief Board ('Board') having regard to her circumstances.
4. It is clear that VCAT only has jurisdiction to review tax assessments and certain payroll tax decisions.[73] VCAT does not have any power to review the decision of the Board to refuse relief. Further, there is no general power vested in the Commissioner (or exercisable by the Tribunal on review) to waive tax properly assessed as payable.[74]
5. There is a discretion in section 35 of the TA Act for the Commissioner to reduce the penalty tax by any amount. In the Commissioner's Determination, the Commissioner determined to remit the penalty tax for each land tax year in full. In circumstances where the Commissioner is yet to issue a reassessment to reflect the remission of the penalty tax, I consider it appropriate to vary the Assessments to do so.

[1] From the 2025 land tax year, VRLT was expanded to all vacant residential land in Victoria.

[2] There was no assessment for the 2021 land tax year due to COVID-19 land tax relief.

[4] [2025] VCAT 493.

[5] At [9]-[13] (footnotes omitted).

[6] [2024] VCAT 1173 [21].

[17] Letter from KES to the State Revenue Office dated 11 July 2022: TB, tab 59 [9(a)]

[19] Orders 1 and 2 of the Tribunal's orders dated 26 November 2025 (emphasis added).

[20] Order 7 of the Tribunal's orders dated 5 March 2024, which is in standard form for a state tax proceeding, provides that leave is required to present a case which differs from that included in the Tribunal Book or to call a witness whose statement has not been provided.

[23] (1982) 47 ALR 191.

[25] [2004] NSWCCA 82; (2004) 60 NSWLR 108.

[27] Hansard, Legislative Assembly, 9 May 2017, 1091.

[28] Commissioner's Statement of Legal Contentions dated 5 July 2024 ('CSLC') [39].

[31] [2007] QCA 188.

[32] [31] (citing the High Court in The Deputy Federal Commissioner of Taxes (South Australia) v. Elder's Trustee and Executor Company Ltd [1936] HCA 64; (1936) 57 C.L.R. 610, 625-626).

[33] [2009] HCA 41; (2009) 239 CLR 27, [47] (Hayne, Heydon, Crennan and Kiefel JJ) (footnotes omitted).

[34] (5th Ed: Oxford University Press, Sydney, 2009).

[35] [2024] VSCA 175 [60].

[36] See, for example, Lotus Oaks Pty Ltd as trustee for the Bozzo Family Trust v Commissioner of State Revenue [2021] VSC 388 [104].

[42] TB, 460-462 (2011) and TB, 987-990 (2022).

[43] [2025] VCAT 493.

[45] [2016] VSC 322 [45].

[47] This is KES's reference, although the evidence suggests that this is the first name of the person.

[48] TB, 1501 (second last arrow point).

[49] See Commissioner of Taxation v Cassaniti [2018] FCAFC 212 [88].

[58] It is evident it is more recent because the photo includes a copy of correspondence from the State Revenue Office and so it can be inferred it was taken after the investigation commenced.

[67] [2004] NSWADTAP 41; (2004) 57 ATR 170, 183-184.

[72] [2025] VCAT 493 [13].

[73] Taxation Administration Act 1997 (Vic), ss 96 and 106.

[74] Pitard & Ors v Commissioner of State Revenue [2019] VCAT 1074 [31]-[32].