31 Persons other than relevant transferees may elect to defer payment of windfall gains tax 21
32 Deferred windfall gains tax and accrued interest must be paid to Commissioner by due date 22
33 Apportionment of deferred windfall gains tax and rolled over windfall gains tax where there is a registration of a plan of subdivision of WGT land 23
34 Tax default if deferred windfall gains tax or rolled over windfall gains tax, and accrued interest, not paid on time 24
Division 3—General 24
35 Interest payable on deferred windfall gains tax 24
Part 5—Exemptions and waivers 26
Division 1—Residential land exemption 26
36 What is residential land? 26
37 Exemption in relation to residential land 29
Division 2—Other exemptions 30
38 Exemptions in relation to rezoning errors 30
39 Exemptions in relation to pre-existing contracts of sale and options 31
40 Exemptions in relation to rezonings underway before 15 May 2021 32
40A Exemption in relation to land owned by university 34
Division 3—Waivers 35
41 Waiver for charitable land 35
Part 6—General 36
42 Windfall gains tax is a first charge on land 36
43 Secretary to provide rezoning information to Commissioner 37
44 Regulations 37
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Endnotes 39
1 General information 39
2 Table of Amendments 42
3 Explanatory details 43
Version No.010
Windfall Gains Tax Act 2021
No. 52 of 2021
Version incorporating amendments as at
1 July 2025
The Parliament of Victoria enacts:
Part 1—Preliminary
S. 1 substituted by No. 52/2021 s. 109.
1 Purpose
The purpose of this Act is to impose a windfall gains tax on the increase in the value of land resulting from a rezoning.
2 Commencement
(1) Section 1 and this section and Parts 7, 8, 10, 11, 12 (other than Divisions 2 and 6), 14 and 15 come into operation on the day after the day on which this Act receives the Royal Assent.
(2) Part 9 and Division 2 of Part 12 come into operation on 15 April 2022.
(3) The remaining provisions of this Act come into operation on 1 July 2023.
3 Definitions
(1) In this Act—
capital improved value has the same meaning as in the Valuation of Land Act 1960;
S. 3(1) def. of charitable land amended by No. 38/2023 s. 19(a).
charitable land means land, or part of land, that is—
(a) owned by a charity; and
(b) used and occupied by a charity exclusively for charitable purposes;
charity means—
(a) a charitable institution; or
(b) a person who holds land on trust for charitable purposes;
CIV1—see sections 12(a) and 13(1)(a);
CIV2—see sections 12(b) and 13(1)(b);
controlling interest—
(a) in relation to a corporation—see section 23; or
(b) in relation to a trust—see section 25(2);
corporation has the same meaning as in section 9 of the Corporations Act;
discretionary trust has the same meaning as in section 3(1) of the Land Tax Act 2005;
S. 3(1) def. of excluded rezoning amended by No. 38/2023 s. 19(b).
excluded rezoning means—
(a) a rezoning between schedules in the same zone; or
(b) a rezoning that causes land to be brought within the contribution area within the meaning of section 201RC of the Planning and Environment Act 1987; or
(c) the first rezoning of land that was in the contribution area within the meaning of section 201RC of the Planning and Environment Act 1987 immediately before that rezoning; or
(d) a rezoning that causes land that was not in a public land zone to be in a public land zone; or
(e) a rezoning that causes land that was in a public land zone to be in a different public land zone; or
(f) a rezoning that causes land to be in a zone declared under subsection (2)(a) to be an excluded zone; or
(g) a rezoning of land that, immediately before the rezoning, was in a zone declared under subsection (2)(b);
general valuation has the same meaning as in the Valuation of Land Act 1960;
group means a group constituted under Division 4 of Part 3;
joint owners means persons who are owners of land jointly or in common, whether as partners or otherwise;
S. 3(1) def. of non-rateable leviable land amended by No. 16/2025 s. 22(6).
non-rateable leviable land has the same meaning as in the Emergency Services and Volunteers Fund Act 2012;
non-rateable non-leviable land has the same meaning as in the Valuation of Land Act 1960;
owner, in relation to land, means—
(a) if the land is under the Transfer of Land Act 1958—the registered proprietor of the land within the meaning of section 4(1) of that Act; or
(b) if the land is not under the Transfer of Land Act 1958—the holder of an estate in fee simple in the land;
Planning Minister means the Minister administering Part 3 of the Planning and Environment Act 1987;
planning scheme means a planning scheme in force under the Planning and Environment Act 1987;
public land zone means a public land zone under a planning scheme;
rateable land has the same meaning as in the Local Government Act 1989;
related corporation—see section 22;
related trust—see section 25(1);
rezoning means an amendment of a planning scheme that causes land to be in a different zone from the zone that it was in immediately before the amendment;
taxable value uplift—see section 10;
S. 3(1) def. of valuation authority repealed by No. 50/2024 s. 99.
value uplift—see section 11;
Victoria Planning Provisions has the same meaning as in section 3(1) of the Planning and Environment Act 1987;
WGT event means a rezoning other than an excluded rezoning;
windfall gains tax means tax imposed by section 6;
zone means a zone under a planning scheme.
(2) The Treasurer, by notice published in the Government Gazette, may declare—
(a) a zone to be an excluded zone for the purposes of paragraph (f) of the definition of excluded rezoning in subsection (1); and
(b) a zone to be a zone for the purposes of paragraph (g) of the definition of excluded rezoning in subsection (1).
4 Taxation Administration Act 1997
This Act is to be read together with the Taxation Administration Act 1997 which provides for the administration and enforcement of this Act and other taxation laws.
5 Act binds the Crown
(1) This Act binds the Crown in right of Victoria and, so far as the legislative power of the Parliament permits, the Crown in all its other capacities.
(2) Nothing in this Act makes the Crown in any of its capacities liable to be prosecuted for an offence.
Part 2—Imposition of windfall gains tax
6 Imposition of windfall gains tax
Windfall gains tax is imposed on land that is rezoned by a WGT event.
Note
Part 5 sets out exemptions and waivers from windfall gains tax.
7 When does liability for windfall gains tax arise?
(1) Liability for windfall gains tax arises when the WGT event occurs.
(2) For the purposes of this Act, a WGT event occurs when the rezoning that constitutes the WGT event takes effect under the Planning and Environment Act 1987.
Notes
1 Section 14 of the Taxation Administration Act 1997 provides for notices of assessment and provides that tax is payable on or before the day specified in the notice.
2 See Part 4 for deferrals of windfall gains tax.
8 Who is liable for windfall gains tax?
The owner of the land when the WGT event occurs is liable to pay windfall gains tax on the land.
Note to s. 8 inserted by No. 38/2023 s. 20.
Note
The owner of land must not purport to require the purchaser under an option to purchase the land or a contract of sale of the land to pay an amount for or towards an assessed windfall gains tax liability. See section 10H of the Sale of Land Act 1962.
Part 3—Assessment of windfall gains tax
Division 1—Rate of windfall gains tax
9 What is the rate of windfall gains tax?
The rate of windfall gains tax is set out in the following table.
Item
Taxable value uplift
Rate of windfall gains tax
1
Not more than $100 000
Nil
2
More than $100 000 but less than $500 000
62⋅5% of that part of the taxable value uplift that exceeds $100 000
3
$500 000 or more
50% of the taxable value uplift
Division 2—Determining taxable value uplift
10 What is the *taxable value uplift* of land?
The taxable value uplift of land is the value uplift of the land less any deductions prescribed by the regulations.
11 What is the *value uplift* of land?
The value uplift of land is determined in accordance with the formula—
where—
CIV1 has the meaning given in—
(a) section 12(a) for rateable land and non‑rateable leviable land; and
(b) section 13(1)(a) for non-rateable non‑leviable land;
CIV2 has the meaning given in—
(a) section 12(b) for rateable land and non‑rateable leviable land; and
(b) section 13(1)(b) for non-rateable non‑leviable land;
**VU** is the value uplift of the land.
12 CIV1 and CIV2—rateable land and non-rateable leviable land
For rateable land or non-rateable leviable land that is rezoned by a WGT event—
(a) CIV1 is the capital improved value of the land contained in the valuation in force under Part II or IIA of the Valuation of Land Act 1960 (as the case may be) immediately before the WGT event occurs; and
(b) CIV2 is the capital improved value of the land contained in a supplementary valuation under Part IIB of the Valuation of Land Act 1960.
13 CIV1 and CIV2—non-rateable non-leviable land
(1) For non-rateable non-leviable land that is rezoned by a WGT event—
(a) CIV1 is the capital improved value of the land as at the relevant date contained in a valuation made for and on behalf of the Commissioner by the Valuer-General or a valuer nominated by the Valuer-General; and
(b) CIV2 is the capital improved value of the land as at the relevant date taking the WGT event into account contained in a valuation made for and on behalf of the Commissioner by the Valuer-General or a valuer nominated by the Valuer-General.
(2) For the purposes of this section, the Commissioner may request a valuation of any non-rateable non-leviable land from the Valuer-General or a valuer nominated by the Valuer-General.
(3) In this section—
relevant date means the date as at which rateable land or non-rateable leviable land was valued for the purposes of the valuation referred to in section 12(a).
14 Valuation of separate occupancies
(1) For the purposes of assessing windfall gains tax, the Commissioner may—
(a) use a valuation made under the Valuation of Land Act 1960 that has determined the value of each separate occupancy on land; and
(b) include in a notice of assessment a description of the occupancy on land.
(2) A valuation of occupancy on land made under the Valuation of Land Act 1960 is taken to be a valuation of land for the purposes of this Act.
15 Value uplift of land not separately valued
(1) This section applies if—
(a) it is necessary to determine CIV1 for any land (the relevant land); and
(b) the relevant land was not valued separately as at the relevant date; and
(c) the relevant land formed part of an occupancy that was valued separately as at the relevant date.
(2) CIV1 for the relevant land is determined in accordance with the formula—
where—
AL is the total area of the relevant land;
AO is the total area of the occupancy;
CIV1 is CIV1 for the relevant land;
CIVO is the capital improved value of the occupancy as at the relevant date.
(3) In this section—
relevant date means the date as at which rateable land or non-rateable leviable land was valued for the purposes of the valuation referred to in section 12(a);
total area, in relation to relevant land or an occupancy, means the area of the relevant land or occupancy plus the sum of the areas of each floor of a building on the relevant land or occupancy (whether above or below ground) other than the ground floor.
Division 3—How is windfall gains tax assessed?
16 Windfall gains tax assessed on aggregated basis and apportioned
(1) Subject to this Act, a taxpayer is to be assessed for windfall gains tax on the aggregated taxable value uplift of all the land owned by the taxpayer that is rezoned by a WGT event.
(2) The windfall gains tax is to be apportioned to land on each title in the same proportion as the proportion the taxable value uplift of that land bears to the aggregated taxable value uplift.
(3) In determining the aggregated taxable value uplift of all the land owned by the taxpayer that is rezoned by a WGT event, any negative taxable value uplifts must be ignored.
17 Assessment of joint owners of land
Joint owners of land are to be jointly assessed for windfall gains tax on the land as if the land were owned by a single person, without regard to—
(a) the separate interest of each joint owner; or
(b) any other land owned by any joint owner (either alone or jointly with someone else).
18 Assessment of trustees
Subject to Division 4, if land is held on trust, the trustee is to be assessed for windfall gains tax on the aggregated taxable value uplift of all the land that is subject to the trust, without regard to any land held by the trustee for any other trust or for the trustee's own benefit.
Division 4—Grouping provisions
19 Assessment of windfall gains tax in relation to groups
(1) Members of a group are to be assessed for windfall gains tax on the aggregated taxable value uplift of all the land owned by members of the group that is rezoned by a WGT event.
(2) Every member of the group is jointly and severally liable to pay windfall gains tax assessed in relation to the group.
20 Constitution of groups
(1) A group is constituted by all the persons forming a group that is not part of any larger group.
(2) If a person is a member of 2 or more groups, the members of all the groups together constitute a group.
(3) The fact that a person is not a member of a group constituted under a provision of this Division does not prevent that person from being a member of a group constituted under another provision of this Division.
21 Groups of corporations, trusts and both
(1) Corporations constitute a group if they are related corporations.
(2) If trusts are related trusts, the trustees of those trusts constitute a group.
(3) A corporation and a trustee of a trust constitute a group if the same person has, or the same persons have together, a controlling interest in the corporation and a controlling interest in the trust.
22 What are *related corporations*?
(1) For the purposes of this Division, corporations are related corporations in any of the circumstances specified in this section.
(2) Corporations are related corporations if one of those corporations—
(a) controls the composition of the board of the other corporation; or
(b) is in a position to cast, or control the casting of, more than 50% of the maximum number of votes that might be cast at a general meeting of the other corporation; or
(c) holds more than 50% of the issued share capital of the other corporation.
(3) Corporations are related corporations if the same person has, or the same persons have together, a controlling interest in each of the corporations.
Note
Controlling interest is defined in section 23.
(4) Corporations are related corporations if—
(a) more than 50% of the issued share capital of one of those corporations (corporation 1) is held by the other corporation (corporation 2) together with the shareholders of corporation 2; and
(b) the percentage of the issued share capital of corporation 2 held by shareholders of corporation 1 is more than the difference between 50% and the percentage of the issued share capital of corporation 1 held by corporation 2.
(5) Corporations are related corporations if one of those corporations is a related corporation of a corporation of which the other of those corporations is a related corporation (including a corporation that is a related corporation of the other of those corporations because of one or more other applications of this subsection).
23 What is a *controlling interest* in a corporation?
For the purposes of this Division, a person has, or persons have together, a controlling interest in a corporation if—
(a) that person, or those persons acting together, can control the composition of the board of the corporation; or
(b) that person is, or those persons acting together are, in a position to cast or control the casting of more than 50% of the maximum number of votes that might be cast at a general meeting of the corporation; or
(c) that person holds, or those persons acting together hold, more than 50% of the issued share capital of the corporation.
24 Further provisions for determining whether corporations are related corporations
(1) For the purposes of this Division—
(a) corporations may be related corporations whether or not they own land in Victoria; and
(b) a reference to the issued share capital of a corporation does not include a reference to any part of it that carries no right to participate beyond a specified amount in a distribution of either profits or capital; and
(c) subject to paragraphs (d) and (e), any shares held or power exercisable by a person or corporation as a trustee or nominee for another person or corporation are taken to be also held or exercisable by the other person or corporation; and
(d) any shares held or power exercisable by a person or corporation by virtue of the provisions of any debentures of another corporation, or of a trust deed for securing any issue of any such debentures, must be disregarded; and
(e) any shares held or power exercisable by, or by a nominee for, a person or corporation (not being held or exercisable as mentioned in paragraph (d)) are taken to be not held or exercisable by that person or corporation if—
(i) the ordinary business of that person or corporation includes the lending of money; and
(ii) the shares are held or the power is exercisable only by way of security given for the purposes of a transaction entered into in the ordinary course of business in connection with the lending of money, not being a transaction entered into with an associate of that person or corporation within the meaning of the Corporations Act; and
(f) the composition of a corporation's board is taken to be controlled by a person or another corporation if the person or other corporation, by the exercise of a power exercisable whether or not with the consent or concurrence of any other person, can appoint or remove all or a majority of the members of the board.
(2) Subsection (1)(f) does not limit the circumstances in which the composition of a corporation's board is to be taken to be controlled by a person or another corporation.
25 What are *related trusts*?
(1) For the purposes of this Division, trusts are related trusts if the same person has, or the same persons have together, a controlling interest in each of the trusts.
(2) A person has, or persons have together, a controlling interest in a trust if—
(a) that person, or those persons acting together, can control the appointment of the trustee; or
(b) that person is, or those persons together are, entitled to more than 50% of the income or capital of the trust.
(3) For the purposes of subsection (2)(b), the Commissioner may determine that a person is, or persons together are, entitled to more than 50% of the income or capital of a discretionary trust even if that person or those persons have no present legal or equitable entitlement to the income or capital.
Division 5—General
26 Notice of errors in notice of assessment
(1) A person who is served with a notice of assessment of windfall gains tax in relation to a WGT event must notify the Commissioner of any error or omission in the notice relating to—
(a) any other land owned by the person when the WGT event occurred that was rezoned by the WGT event but is not specified in the notice; and
(b) in the case of a notice of assessment for land jointly owned by 2 or more owners, any other land owned by the joint owners when the WGT event occurred that was rezoned by the WGT event but is not specified in the notice; and
(c) if the person is a member of a group, any land owned by another member of the group when the WGT event occurred that was rezoned by the WGT event but is not specified in the notice.
(2) Notice of the error or omission must be given to the Commissioner within 60 days from the date of issue of the notice of assessment.
(3) If there is more than one owner of the land specified in the notice of assessment, it is sufficient compliance with this section if one of the owners provides the required information on behalf of all of them.
Part 4—Deferral of windfall gains tax
Division 1—Preliminary
27 Definitions
In this Part—
accrued interest means interest calculated under section 35;
dutiable transaction has the same meaning as in the Duties Act 2000;
excluded dutiable transaction has the meaning given by section 28;
excluded relevant acquisition means—
(a) a relevant acquisition described in section 78(1)(a) of the Duties Act 2000 that is an acquisition of an interest in a landholder solely from a pro rata increase in the interests of—
(i) all unit holders in the landholder where the landholder is a unit trust scheme; or
(ii) all shareholders of the landholder where the landholder is a company; or
(b) a relevant acquisition described in section 78(1)(b) of the Duties Act 2000;
landholder has the same meaning as in section 71 of the Duties Act 2000;
no consideration dutiable transaction has the meaning given by section 29;
relevant acquisition has the same meaning as in section 78 of the Duties Act 2000;
relevant charitable land transaction has the meaning given by section 30;
relevant transferee means a person who makes an election under section 29(2) or 30(2);
rolled over windfall gains tax means the amount of windfall gains tax a relevant transferee has elected to assume under section 29(2) or 30(2);
WGT land means the whole or part of the land on which the windfall gains tax is imposed under section 6.
28 Meaning of *excluded dutiable transaction*
For the purposes of this Part, each of the following dutiable transactions is an excluded dutiable transaction—
(a) the acquisition of an economic entitlement in relation to WGT land under Part 4B of Chapter 2 of the Duties Act 2000;
(b) the transfer of an estate in fee simple in WGT land in relation to which the transferee is registered as the registered proprietor pursuant to an application under section 49 of the Transfer of Land Act 1958;
(c) a no consideration dutiable transaction;
(d) a relevant charitable land transaction.
29 Meaning of *no consideration dutiable transaction*
(1) For the purposes of this Part, a dutiable transaction relating to land is a no consideration dutiable transaction if—
(a) the transaction is a transaction relating to WGT land for which there is no consideration; and
(b) the transferee under the transaction makes an election under subsection (2).
(2) The transferee may elect to assume the liability to pay the whole of the deferred windfall gains tax and any accrued interest payable under this Part by making the election to the Commissioner in a form approved by the Commissioner.
(3) An election under subsection (2) must be made on or before the date of completion of the dutiable transaction.
(4) On completion of the dutiable transaction and acceptance by the Commissioner of an election under subsection (2)—
(a) the transferee becomes liable to pay the whole of the deferred windfall gains tax and any accrued interest payable under this Part; and
(b) the liability of the transferor to pay the deferred windfall gains tax and any accrued interest payable under this Part is extinguished.
(5) In this section—
consideration has the same meaning as in section 32A of the Duties Act 2000.
30 Meaning of *relevant charitable land transaction*
(1) For the purposes of this Part, a dutiable transaction relating to charitable land is a relevant charitable land transaction if—
(a) a WGT event has occurred in respect of the charitable land before the dutiable transaction and since that WGT event the charitable land has been such land continuously and exclusively; and
(b) the transferee under the transaction will continue to use the land as charitable land; and
(c) the transferee under the transaction makes an election under subsection (2).
(2) The transferee may elect to assume the liability to pay the whole of the deferred windfall gains tax and any accrued interest payable under this Part by making the election to the Commissioner in a form approved by the Commissioner.
(3) An election under subsection (2) must be made on or before the date of completion of the dutiable transaction.
(4) On completion of the dutiable transaction and acceptance by the Commissioner of an election under subsection (2)—
(a) the transferee becomes liable to pay the whole of the deferred windfall gains tax and any accrued interest payable under this Part; and
(b) the liability of the transferor to pay the deferred windfall gains tax and any accrued interest payable under this Part is extinguished.
Division 2—Deferral of payment
31 Persons other than relevant transferees may elect to defer payment of windfall gains tax
(1) A person (other than a relevant transferee) who is liable to pay windfall gains tax may elect to defer the payment of up to 100% of that tax.
(2) Subject to subsection (3), an election must be made to the Commissioner—
(a) in a form approved by the Commissioner; and
(b) before the day on which the windfall gains tax is payable.
(3) The Commissioner may accept an election on or after the day on which the windfall gains tax is payable.
(4) An election to defer the payment of the whole or part of the windfall gains tax under subsection (1) (including an election accepted by the Commissioner under subsection (3)) takes effect from the date on which the liability to pay the tax arises.
(5) A person who has deferred the payment of part of the windfall gains tax under this section must pay the part of the tax that has not been deferred by the day specified in the notice of assessment of windfall gains tax given to the person.
(6) If a part of the windfall gains tax that has not been deferred under this section is not paid by the day specified in the notice of assessment of windfall gains tax, the whole of the windfall gains tax becomes immediately payable as if the election of the deferral had never been made.
32 Deferred windfall gains tax and accrued interest must be paid to Commissioner by due date
(1) A person who has deferred the payment of the whole or part of windfall gains tax under section 31 must pay to the Commissioner the deferred amount and any accrued interest payable under this Part, within 30 days after—
(a) a dutiable transaction (other than an excluded dutiable transaction) occurs in relation to the WGT land; or
(b) a relevant acquisition (other than an excluded relevant acquisition) occurs in respect of a landholder who is the owner of the WGT land; or
(c) the day that is 30 years after the WGT event—
whichever occurs first.
(2) A relevant transferee must pay to the Commissioner the rolled over windfall gains tax and any accrued interest payable under this Part, within 30 days after—
(a) a dutiable transaction (other than an excluded dutiable transaction) occurs in relation to the WGT land; or
(b) a relevant acquisition (other than an excluded relevant acquisition) occurs in respect of a landholder who is the registered proprietor of the WGT land; or
(c) the day that is 30 years after the WGT event—
whichever occurs first.
33 Apportionment of deferred windfall gains tax and rolled over windfall gains tax where there is a registration of a plan of subdivision of WGT land
(1) This section applies if—
(a) the whole or a part of windfall gains tax is deferred under this Part; and
(b) there is a registration of a plan of subdivision of the land in respect of which that tax is imposed.
(2) On the registration of the plan of subdivision, the whole or part of windfall gains tax deferred under this Part (including rolled over windfall gains tax), and any accrued interest payable under this Part, (the deferred tax) is taken to be apportioned to each lot created under the plan of subdivision by reference to the area each lot bears to all of the lots created under the plan of subdivision.
(3) In this section—
lot has the same meaning as in the Subdivision Act 1988.
34 Tax default if deferred windfall gains tax or rolled over windfall gains tax, and accrued interest, not paid on time
A tax default occurs for the purposes of the Taxation Administration Act 1997 if a person does not pay—
(a) any windfall gains tax deferred under section 31, and any accrued interest, when due for payment under section 32(1); or
(b) any rolled over windfall gains tax, and any accrued interest, when due for payment under section 32(2); or
(c) the windfall gains tax that has not been deferred under section 31 by the day specified in the notice of assessment of windfall gains tax.
Division 3—General
35 Interest payable on deferred windfall gains tax
(1) Windfall gains tax that is deferred in whole or in part under this Part (including rolled over windfall gains tax) is subject to the payment of interest calculated on the deferred amount of the windfall gains tax on a daily basis.
(2) The amount of interest referred to in subsection (1) is to be calculated at the 10-year bond rate applying from time to time.
(3) For the purposes of this section, the 10-year bond rate in respect of any day is the average of the daily yields for the 10-year Treasury Corporation of Victoria bond (published from time to time by the Treasury Corporation of Victoria established under Part 2 of the Treasury Corporation of Victoria Act 1992) for the month of May in the financial year preceding the financial year in which the day occurs.
Part 5—Exemptions and waivers
Division 1—Residential land exemption
36 What is *residential land*?
(1) For the purposes of this Division, residential land is land that has a building affixed to it that in the Commissioner's opinion—
(a) is designed and constructed primarily for residential purposes; and
(b) may lawfully be used as a place of residence.
(2) Land is also residential land for the purposes of this Division if the Commissioner is satisfied that—
(a) a residence is being constructed or renovated on the land; and
(b) before the commencement of the construction or renovation—
(i) the land was capable of being lawfully used as a place of residence; or
(ii) there was a residence that was uninhabitable on the land; and
(c) on the completion of the construction or renovation, the land will be capable of being lawfully used as a place of residence.
(3) The Commissioner cannot be satisfied for the purposes of subsection (2)(a) unless a building permit has been issued for the construction or renovation.
(4) Despite subsections (1) and (2), land other than land used for primary production is not residential land unless the Commissioner is satisfied that the land is used primarily for residential purposes.
(5) Despite subsections (1) and (2) but subject to subsection (6), residential land does not include land that is capable of being used and occupied solely or primarily as—
(a) commercial residential premises and that may lawfully be used and occupied in that way; or
(b) a residential care facility and that may lawfully be used and occupied in that way; or
(c) a supported residential service and that may lawfully be used and occupied in that way; or
(d) a retirement village service and that may lawfully be used and occupied in that way.
(6) Subsection (5) does not apply to land in commercial residential premises, a residential care facility, a supported residential service or a retirement village on which there is a residence that is owned separately, and held on a separate title, from other land in the commercial residential premises, residential care facility, supported residential service or retirement village.
(7) In this section—
commercial residential premises has the same meaning as in the A New Tax System (Goods and Services Tax) Act 1999 of the Commonwealth;
land used for primary production means land used primarily for—
(a) cultivation for the purpose of selling the produce of cultivation (whether in a natural, processed or converted state); or
(b) the maintenance of animals or poultry for the purpose of selling them or their natural increase or bodily produce; or
(c) the keeping of bees for the purpose of selling their honey; or
(d) commercial fishing, including the preparation for commercial fishing or the storage or preservation of fish or fishing gear; or
(e) the cultivation or propagation for sale of plants, seedlings, mushrooms or orchids;
residence means a building affixed to land that is designed and constructed primarily for residential purposes;
residential care facility means any premises—
(a) in which—
(i) a residential care service; or
(ii) a multi purpose service—
within the meaning of the Aged Care Act 1997 of the Commonwealth, is operated by an approved provider within the meaning of that Act; and
(b) in respect of which an allocation of residential care places is in effect under Division 15 of that Act;
retirement village means a complex containing residential premises (whether or not including hostel units) predominantly or exclusively occupied, or available for occupation, by retired persons under—
(a) a residential tenancy agreement or any other lease or licence; or
(b) a right conferred by shares; or
(c) the ownership of residential premises subject to a right or option of repurchase on conditions restricting the subsequent disposal of the premises—
other than a complex or premises that is or are a residential care facility or supported residential service;
supported residential service has the same meaning as in the Supported Residential Services (Private Proprietors) Act 2010.
37 Exemption in relation to residential land
(1) Windfall gains tax is not imposed on residential land (whether on one or more titles) that does not exceed 2 hectares if the land is the only residential land owned by a taxpayer that is rezoned by a WGT event.
(2) If residential land (whether on one or more titles) owned by a taxpayer that is rezoned by a WGT event exceeds 2 hectares, the taxable value uplift of the land on each title for the purposes of this Act is to be adjusted in accordance with the formula—
where—
AVU is the adjusted taxable value uplift of the residential land on that title;
**RL** is the total area of all of the residential land in hectares;
**VU** is the taxable value uplift of the residential land on that title calculated under Division 2 of Part 3.
Division 2—Other exemptions
38 Exemptions in relation to rezoning errors
S. 38(1) amended by No. 38/2023 s. 21(1).
(1) Windfall gains tax is not imposed on land that is rezoned by a WGT event if the Commissioner is satisfied that the rezoning constituting the WGT event is caused by an amendment (whether prepared under section 20A of the Planning and Environment Act 1987 or otherwise) to correct an obvious or technical error in the Victoria Planning Provisions or a planning scheme.
S. 38(1A) inserted by No. 38/2023 s. 21(2).
(1A) The Commissioner may consult the Secretary to the Department of Transport and Planning in determining whether a rezoning is a correcting WGT event.
(2) If a correcting WGT event results in a negative value uplift to land on which windfall gains tax has been assessed in respect of an original WGT event, windfall gains tax is not imposed on the land in respect of the original WGT event and—
(a) the Commissioner must reassess the windfall gains tax liability accordingly; and
(b) the taxpayer is entitled to a refund of any windfall gains tax and interest paid in respect of the original WGT event.
(3) Subsection (2) applies only if the owner of the land at the time of the correcting WGT event is the same as the owner of the land at the time of the original WGT event.
S. 38(3A) inserted by No. 38/2023 s. 21(3).
(3A) If a rezoning consists partly of a correcting WGT event and partly of a rezoning that is not a correcting WGT event in relation to the same land—
(a) any value uplift attributable to the correcting WGT event is to be ignored in assessing any windfall gains tax on the land; and
(b) for that purpose the Commissioner must seek the advice of the Valuer‑General as to the amount of value uplift attributable to the correcting WGT event.
(4) If payment of windfall gains tax affected by this section is deferred under Part 4, the Commissioner may make a reassessment under section 9 of the Taxation Administration Act 1997 for the purposes of this section more than 5 years after the initial assessment.
(5) In this section—
correcting WGT event means a rezoning referred to in subsection (1);
original WGT event means a rezoning that is corrected by a correcting WGT event.
39 Exemptions in relation to pre-existing contracts of sale and options
Windfall gains tax is not imposed on land that is rezoned by a WGT event if—
(a) the land is subject to a contract of sale entered into before 15 May 2021 that has not been completed by the transfer of the land before the WGT event occurred; or
(b) the land is subject to an option to enter into a contract of sale granted before 15 May 2021 that has not been exercised before the WGT event occurred or has been exercised and the contract of sale to which the option relates has not been completed before the WGT event occurred, but only if the terms of the contract of sale were settled at the time the option was granted.
40 Exemptions in relation to rezonings underway before 15 May 2021
(1) Windfall gains tax is not imposed on land that is rezoned by a WGT event if the Commissioner is satisfied that—
(a) the planning scheme amendment constituting the rezoning was prepared by a Council; and
(b) a request for the amendment was created and registered in the Amendment Tracking System by the Council before 15 May 2021; and
(c) before 15 May 2021 the owner of the land—
(i) approached the Council to request the rezoning; and
(ii) paid for, was liable to pay for, or had otherwise performed or procured relevant work in relation to the rezoning; or
(iii) paid, or was liable to pay, relevant costs to support consideration of the rezoning; and
(d) the total value of the relevant work and relevant costs referred to in paragraph (c)(ii) and (iii) was not less than the threshold amount.
(2) Windfall gains tax is not imposed on land that is rezoned by a WGT event if the Commissioner is satisfied that—
(a) the planning scheme amendment constituting the rezoning was prepared by or at the request of the Planning Minister; and
(b) the Planning Minister agreed before 15 May 2021 to prepare the amendment; and
(c) before 15 May 2021 the owner of the land—
(i) approached the Planning Minister to request the rezoning; and
(ii) paid for, was liable to pay for, or had otherwise performed or procured relevant work in relation to the rezoning; or
(iii) paid, or was liable to pay, relevant costs to support consideration of the rezoning; and
(d) the total value of the relevant work and relevant costs referred to in paragraph (c)(ii) and (iii) was not less than the threshold amount.
(3) In this section—
S. 40(3) def. of Amendment Tracking System amended by No. 38/2023 s. 22.
Amendment Tracking System means the system managed by the Department of Transport and Planning to register, track and process planning scheme amendments;
Council has the same meaning as in the Local Government Act 1989;
relevant costs means costs payable under regulation 6, 7 or 8 of the Planning and Environment (Fees) Regulations 2016;
relevant work means professional analysis or assessment that, in the Commissioner's opinion, is necessarily performed in preparing for or seeking a rezoning of land including but not limited to—
(a) surveying analysis; and
(b) engineering analysis; and
(c) traffic analysis; and
(d) master planning analysis; and
(e) Aboriginal cultural heritage assessment; and
(f) architectural analysis; and
(g) environmental analysis—
but not including works done to the land itself, such as remediation or land clearing;
threshold amount means the lesser of—
(a) 1% of the capital improved value of the land immediately before the WGT event; or
(b) $100 000.
S. 40A inserted by No. 23/2022 s. 36.
40A Exemption in relation to land owned by university
(1) Windfall gains tax is not imposed on land that is rezoned by a WGT event if—
(a) the land is owned by a university; and
(b) the university is a charity; and
(c) the Commissioner is satisfied that any land revenue from the land will be used to further the university's charitable purposes.
(2) For the purposes of subsection (1)(c), the university must provide the Commissioner with a declaration as to—
(a) the nature of any land revenue from the land; and
(b) the intended application of the land revenue; and
(c) how the application of the land revenue will further the university's charitable purposes.
(3) In this section—
land revenue means any revenue arising from the sale or use of the land, including any of the following—
(a) sale proceeds from the sale of the land;
(b) rental income from leasing the land;
(c) licence fees from licensing the land;
registered higher education provider has the same meaning as in section 5 of the Tertiary Education Quality and Standards Agency Act 2011 of the Commonwealth;
university means a registered higher education provider that is registered under the Tertiary Education Quality and Standards Agency Act 2011 of the Commonwealth in the "Australian University" provider category of the Higher Education Standards Framework.
Division 3—Waivers
41 Waiver for charitable land
S. 41(1) amended by No. 38/2023 s. 23.
(1) The Commissioner must waive windfall gains tax and any interest payable under Part 4 in respect of charitable land if the land, or relevant part of the land, has remained as charitable land continuously for 15 years after the occurrence of the WGT event that gave rise to the liability for the tax.
(2) If part only of land has remained as charitable land continuously for 15 years after the occurrence of the WGT event, the waiver under this section applies only to that part.
(3) The Commissioner may make a reassessment of windfall gains tax under section 9 of the Taxation Administration Act 1997 for the purposes of this section more than 5 years after the initial assessment.
Part 6—General
42 Windfall gains tax is a first charge on land
(1) Unpaid windfall gains tax (including any interest and penalty tax under the Taxation Administration Act 1997 and any accrued interest on deferral under Part 4) is a first charge on the land on which the tax is payable.
(2) The charge has priority over all other encumbrances to which the land is subject.
(3) If a person—
(a) is a bona fide purchaser for value of land; and
(b) obtains a certificate from the Commissioner under section 95AA of the Taxation Administration Act 1997 in respect of the land—
the charge does not secure any amount of windfall gains tax (including any interest and penalty tax) on the land in excess of the amount set out in the certificate.
(4) If the certificate states that a WGT event has occurred that rezones the land but any windfall gains tax on the land is yet to be assessed, subsection (3) does not apply in relation to any windfall gains tax payable on the land in relation to that WGT event.
Note
Notice of a charge under this section may be lodged with the Registrar under section 106B of the Transfer of Land Act 1958.
S. 43 amended by No. 38/2023 s. 24.
43 Secretary to provide rezoning information to Commissioner
The Secretary to the Department of Transport and Planning—
(a) within 10 days after the Planning Minister receives an adopted planning scheme amendment that will cause a rezoning on its approval, must give the Commissioner a written notice setting out—
(i) the zoning changes to be caused by the amendment; and
(ii) a description of any land that will be affected by those zoning changes; and
(b) within 10 days after the approval of a planning scheme amendment that causes a rezoning, must give the Commissioner a written notice setting out—
(i) the zoning changes caused by amendment; and
(ii) a description of any land that is affected by those zoning changes; and
(iii) any other information about the zoning changes that is required by the Commissioner.
44 Regulations
(1) The Governor in Council may make regulations for or with respect to any matter or thing that is required or permitted to be prescribed or necessary to be prescribed to give effect to this Act.
(2) Regulations made under this Act—
(a) may be of general or limited application;
(b) may differ according to differences in time, place or circumstances.
Pts 7−11 (Headings and ss 45−69) repealed by No. 52/2021 s. 110(1).
Pt 12 (Headings and ss 70−94) amended by Nos 52/2021 s. 110(1), 23/2022 s. 22(3), repealed by No. 52/2021 s. 110(2).
Pt 13 (Heading and ss 95−101) repealed by No. 52/2021 s. 110(2).
Pts 14, 15 (Headings and ss 102−107) repealed by No. 52/2021 s. 110(1).
Pt 16 (Heading and ss 108−110) repealed by No. 52/2021 s. 110(2).
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Endnotes
1 General information
See www.legislation.vic.gov.au for Victorian Bills, Acts and current Versions of legislation and up-to-date legislative information.
Minister's second reading speech—
Legislative Assembly: 13 October 2021
Legislative Council: 28 October 2021
The long title for the Bill for this Act was "A Bill for an Act to impose a windfall gains tax on the increase in the value of land resulting from a rezoning and amend the Duties Act 2000, the Essential Services Commission Act 2001, the Gambling Regulation Act 2003, the Land Tax Act 2005, the State Taxation and Mental Health Acts Amendment Act 2021, the Taxation Administration Act 1997, the Valuation of Land Act 1960, the Water Act 1989 and the Water Industry Act 1994 and for other purposes."
Constitution Act 1975:
Section 85(5) statement:
Legislative Assembly: 13 October 2021
Legislative Council: 28 October 2021
Absolute majorities:
Legislative Assembly: 28 October 2021
Legislative Council: 18 November 2021
The Windfall Gains Tax and State Taxation and Other Acts Further Amendment Act 2021 was assented to on 30 November 2021 and comes into operation as follows:
Sections 1, 2, 45–48, 55–70, 75–80, 102–107 on 1 December 2021: section 2(1); sections 49–54, 71–74 on 15 April 2022: section 2(2); sections 3–44, 81–101, 108–110 on 1 July 2023: section 2(3).
The title of this Act was changed from the Windfall Gains Tax and State Taxation and Other Acts Further Amendment Act 2021 to the Windfall Gains Tax Act 2021 by section 108 of the Windfall Gains Tax and State Taxation and Other Acts Further Amendment Act 2021, No. 52/2021.
INTERPRETATION OF LEGISLATION ACT 1984 (ILA)
Style changes
Section 54A of the ILA authorises the making of the style changes set out in Schedule 1 to that Act.
References to ILA s. 39B
Sidenotes which cite ILA s. 39B refer to section 39B of the ILA which provides that where an undivided section or clause of a Schedule is amended by the insertion of one or more subsections or subclauses, the original section or clause becomes subsection or subclause (1) and is amended by the insertion of the expression "(1)" at the beginning of the original section or clause.
Interpretation
As from 1 January 2001, amendments to section 36 of the ILA have the following effects:
• Headings
All headings included in an Act which is passed on or after 1 January 2001 form part of that Act. Any heading inserted in an Act which was passed before 1 January 2001, by an Act passed on or after 1 January 2001, forms part of that Act. This includes headings to Parts, Divisions or Subdivisions in a Schedule; sections; clauses; items; tables; columns; examples; diagrams; notes or forms. See section 36(1A)(2A).
• Examples, diagrams or notes
All examples, diagrams or notes included in an Act which is passed on or after 1 January 2001 form part of that Act. Any examples, diagrams or notes inserted in an Act which was passed before 1 January 2001, by an Act passed on or after 1 January 2001, form part of that Act. See section 36(3A).
• Punctuation
All punctuation included in an Act which is passed on or after 1 January 2001 forms part of that Act. Any punctuation inserted in an Act which was passed before 1 January 2001, by an Act passed on or after 1 January 2001, forms part of that Act. See section 36(3B).
• Provision numbers
All provision numbers included in an Act form part of that Act, whether inserted in the Act before, on or after 1 January 2001. Provision numbers include section numbers, subsection numbers, paragraphs and subparagraphs. See section 36(3C).
• Location of "legislative items"
A "legislative item" is a penalty, an example or a note. As from 13 October 2004, a legislative item relating to a provision of an Act is taken to be at the foot of that provision even if it is preceded or followed by another legislative item that relates to that provision. For example, if a penalty at the foot of a provision is followed by a note, both of these legislative items will be regarded as being at the foot of that provision. See section 36B.
• Other material
Any explanatory memorandum, table of provisions, endnotes, index and other material printed after the Endnotes does not form part of an Act.
See section 36(3)(3D)(3E).
2 Table of Amendments
This publication incorporates amendments made to the Windfall Gains Tax Act 2021 by Acts and subordinate instruments.