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THE DRAFTED legislation of the Growth Area Infrastructure Contribution was released on Friday and members of Taxed Out’s Northern Branch have labelled the changes a "wolf in sheep’s clothing", with the group's concerns unchanged in the draft.
Planning Minister Justin Madden said that changes were made after extensive consultation with the community and other stakeholders on the GAIC and the draft legislation is now available for public comment until November 2 at 5pm.
Member for Yan Yean Danielle Green and Member for Seymour Ben Hardman are urging residents to provide their feedback on the draft legislation.
"There has been a lot of debate in the community about the best way to ensure our quality of life is preserved and families have access to public transport, schools, roads, hospitals and other vital infrastructure that the community needs," Mr Hardman said.
"We have taken the views of our constituents on how best this can be achieved to the Planning Minister and the Brumby Government has listen to community views and these are reflected in the draft legislation for the GAIC released," he said.
The main changes to the GAIC include making the tax payable by those who purchase property or land rather than the property owner, and giving the purchaser the option of deferring the payment until the land is on-sold, subdivided or developed.
While Taxed Out acknowledges the changes, they maintain that the same property transaction is being taxed and will still impact on the vendor.
They insist that it is only fair to charge the tax when a planning permit for development is granted.
The group also maintains that the Government’s justification for charging the GAIC on the ‘first property transaction’ – that all land enjoys a substantial ‘value increase’ upon inclusion in the Urban Growth Boundary – is fundamentally flawed.
Taxed Out also stated that by allowing a deferred payment of the tax, purchasers will incur interest on the tax that will be indexed annually, therefore growing at a compounding rate that longer it is deferred.
"What would want to go through that?" questioned Jeanette Laffan from Taxed Out.
She said landowners feel that this tax is about getting the property owners out and the developers in.
"Nothing has changed, now there is a big concession for developers," she said.
Another major concern of the group is how this change will affect property prices, believing that the price a landowner receives when selling will be reduced by the amount of tax that will be charged.
The tax will still be charged at a rate of $80,000 or $95,000 per hectare, regardless of the sale price.
"Certainly the tax will not be added to the sale price as the purchaser has the obligation to pay the tax and will not pay it twice," Taxed Out stated.
Landowners within the new and existing growth areas will also have a notice registered on their Certificate of Title showing purchasers that they will be liable for the GAIC if they purchase.
"How can anyone on small acreage attract a purchaser with that sort of liability attached? Certainly no family wishing to live on a few hectares will take on this added liability when they can purchase a property outside the [Urban Growth Boundary] without this headache. That leaves only developers in the market," Michael Hocking, Chairman of Taxed Out said.
"When you remember development in the investigation areas will not commence until 2019 even developers will not be interested in property for ten years. This will destroy the value of these homes which are predominantly held by families and the elderly," he said.
While Mr Madden said that by changing the legislation the GAIC is the "fairest way" by applying to those who would profit from subdividing and developing land brought into the UGB, Ms Laffan said that people wanting to purchase a lifestyle property will still be hit with the tax.
"There are a lot of angry people … if they think this is going to please us they’re wrong. The fight continues," she said.
Members of Taxed Out will be appearing before the Outer Suburban/Interface Services and Development Committee Parliamentary Inquiry this Thursday, raising concerns that haven’t been addressed in the draft legislation.
Taxed Out also met with Mr Madden yesterday to address their concerns directly.
Details of the draft legislation and instructions on how to comment are available at or by calling 1800 980 789.
The public is able to comment on the draft legislation until November 2 at 5pm.