Victoria's election: what the land tax and property tax promises mean for investors and business owners

This article summarises the main property-related pledges and what they could mean for holding costs and investment returns. It doesn't take a position on any party or on the election result.

What changed in 2023

In 2023, the former Andrews government lowered the land tax-free threshold from $300,000 to $50,000. That brought many more non-exempt properties, including investment, commercial and some vacant land, into land tax.

The change affected investment property holding costs across Victoria and has been widely criticised by property and business groups. Victoria's land tax regime was a major factor in the Business Council of Australia ranking the state last in its 2026 "best places to do business" list.

Labor's pledges

• Land tax: if re-elected, Labor would progressively lift the threshold back to $300,000 over six years. Labor says that would save affected taxpayers up to $975 a year.
• Trust restructures: Labor would waive stamp duty for three years for businesses restructuring out of discretionary trusts because of the federal government's new minimum tax on trusts. The waiver would apply to businesses already eligible for Commonwealth rollover relief and would need new legislation. See Restructuring out of a discretionary trust.

The Coalition's pledges

• Land tax: the Coalition would lift the land tax-free threshold from $50,000 to $300,000 over five years. It estimates 280,000 Victorians would save up to $975 a year, including small business owners with taxable commercial properties.
• Emergency services levy: it would scrap the Emergency Services and Volunteers Fund levy and restore the previous Fire Services Property Levy arrangements.
• Commercial property costs: it says it would introduce legislation before Christmas to reduce costs for commercial property owners and businesses paying property outgoings.
• Other measures: payroll tax cuts and a pledge not to introduce new taxes.

Other parties

• The Greens: support higher taxes on vacant properties and propose eventually replacing stamp duty with land tax.
• One Nation: would repeal Labor's land tax increases and raise the payroll tax threshold so more small employers are exempt.

What it could mean for investors and business owners

1. Lower holding costs, but gradually

Both major parties plan to phase in the higher threshold over five or six years. The savings would build over time, and they would have the most effect on properties with lower site values. Owners of higher-value holdings would generally still pay land tax.

2. Small savings per property, larger for portfolios

A saving of up to $975 a year per taxpayer is meaningful but modest. For investors and businesses, the bigger factors remain interest rates, rents and valuations.

3. Commercial property costs

For commercial owners, the emergency services levy and the treatment of outgoings may matter as much as land tax. Investors should look at how each proposal would affect costs passed on to tenants under their leases.

4. Don't buy or borrow based on election promises

Pledges aren't law. Policies can change, be delayed or be implemented differently after an election. Funding decisions should work under current tax settings, with any future relief treated as a bonus.

5. Victoria's other tax changes still apply

Commercial and industrial property bought in Victoria may also be moving into the Commercial and Industrial Property Tax regime. See Buying commercial property in Victoria: how the new property tax affects your funding.

For brokers

• Use current land tax settings when modelling clients' holding costs.
• Help investor and business clients understand which pledges could affect their properties after the election.
• Encourage clients to get tax advice on their own circumstances, especially those with several properties or trust structures.

The Funding Door view

Lower holding costs would be welcome for Victorian investors and business owners, whatever the election result. But sound funding decisions rest on today's numbers, not campaign promises. We'll review the outcome after the election and update this article as policies are confirmed.