Labor has pledged to lift the land tax threshold back to $300,000 if returned at the November election. The Coalition made a similar promise in May. The differences sit in the timetable, the funding, and what the law already does after 2033.
Victoria’s land tax is set to fall after the November election, whichever major party wins.
On 4 October, Premier Ben Carroll committed a returned Labor government to reversing the 2023 change that cut the general land tax threshold from $300,000 to $50,000. The Liberals and Nationals announced their own version in May.
So the question for builders, developers and the investors who buy their product is no longer whether the threshold rises. It is how fast it rises, who pays for it, and which part of the change actually alters anything.
What the 2023 change did to land tax in Victoria
The lower threshold was part of the COVID Debt Repayment Plan in the 2023/24 State Budget. From the 2024 land tax year, landholdings between $50,000 and $100,000 attract a flat $500 charge. Holdings from $100,000 to below $300,000 attract $975.
Above $300,000, the $975 charge applies on top of a rate increase of 0.1 percentage points. The State Revenue Office says these temporary changes are legislated to apply until 30 June 2033, and its current rate table covers the 2024 to 2033 land tax years.
A principal place of residence remains exempt. The tax falls on investment properties, vacant land, holiday homes and, in some cases, the business portion of a home.
What is the land tax threshold?
The land tax threshold is the total taxable site value of land an owner can hold in a state before land tax applies. Site value excludes buildings, and a principal place of residence is exempt and not counted. In Victoria, the general threshold has been $50,000 since the 2024 land tax year, down from $300,000.
How Labor’s land tax threshold timetable works
Labor describes a six year implementation, starting in its first budget and backed by legislation.
The threshold would rise by $25,000 in each of 2027/28, 2028/29, 2029/30 and 2030/31. Labor says those four steps take about 107,000 people out of land tax: 33,000 and then 27,000 people saving $500 a year, followed by 23,000 and then 24,000 people saving $975.
That takes the threshold to $150,000 by 2030/31. The remaining $150,000 is promised beyond the forward estimates, with the full $300,000 restored at the end of 2033/34. Labor says more than 250,000 people leave the system in total.
Labor costs the change at $230 million over five years.
Where the money comes from
The release names three sources of budget capacity. Consolidating the government car fleet saves $70 million. Reducing public service executive roles saves more than $100 million. Delaying level crossing removals saves $798 million.
Together those offsets come to nearly $970 million, well above the stated $230 million cost. Labor frames them as creating capacity in the budget rather than a line by line match.
The release does not say which level crossings are affected or for how long. That detail matters to anyone tracking the civil pipeline. The Level Crossing Removal Project currently lists eight crossings on the Upfield line, between Brunswick and Parkville, for completion in 2030 as a 2.1 kilometre rail bridge.
The question is no longer whether the threshold rises. It is how fast it rises, who pays for it, and which part of the change actually alters anything.
How the Coalition’s land tax plan compares
The opposition’s plan ends at the same $300,000 threshold. In Parliament on 13 May, a Coalition member described it as lifting the threshold back over five years, returning between $500 and $975 a year to owners with holdings up to $300,000.
Five years against six is the visible difference. The less visible one is the finish line.
On the current legislated timetable, the temporary COVID settings run out with the 2033 land tax year. Labor’s last steps sit outside its forward estimates and finish at roughly the point the existing law already expires. Most of the practical gap between the two plans sits in how quickly the threshold climbs between 2027 and 2031.
Labor’s release also does not address the $975 charge and the 0.1 point rate increase that apply to holdings above $300,000. The Coalition material we reviewed does not specify that either. For larger investors and developers holding land, that is the part still unanswered.
Why Victoria’s land tax threshold matters to builders
Three groups in our community feel this directly.
The first is the investor market that buys house and land packages, townhouses and apartments. At $50,000, almost any Victorian investment property carries a land tax bill from the first year of ownership. That is a holding cost buyers weigh against other states.
The second is home based builders and tradies. Where a home is used for a substantial business activity, the business portion of the land can become taxable, and the low threshold pulls more of those portions over the line. We set out how that rule works in our look at the land tax trap for home based operators.
For a sole operator it is one of the smaller recurring costs of running a building business, but it arrives every year.
The third is civil contractors and the trades who move between infrastructure and housing. When rail work shifts in time, so does demand for the same labour. Engineering and housing competing for trades is a recurring theme in the wider construction industry outlook.
How Victoria’s land tax threshold compares with other states
| Jurisdiction | General land tax threshold (individuals) |
| New South Wales | $1,075,000 for the 2026 land tax year |
| Victoria | $50,000 (2024 to 2033 land tax years) |
| Queensland | $600,000; $350,000 for companies and trusts |
| South Australia | $936,000 for 2026/27 |
| Western Australia | $300,000 |
| Tasmania | About $125,000 |
| ACT | No threshold; fixed charge of $1,778 plus a rate on land value from 1 July 2026 |
| Northern Territory | No land tax |
Even back at $300,000, Victoria would sit level with Western Australia and well below New South Wales, Queensland and South Australia. The ACT and Tasmania are the only jurisdictions that start lower.
What will settle how much this changes
Three things will decide the practical effect. Whether either party’s legislation touches the charge on holdings above $300,000. Which level crossing projects move, and to when. And whether the steps after 2030/31 survive later budgets, since they sit outside the forward estimates.
Victorians vote on 28 November 2026.
For the investors who buy what builders build, the headline is relief. The detail is a threshold that reaches $150,000 by 2031 under one plan and moves faster under the other, with the last stretch landing close to where the law was already heading.
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Your questions answered
Both major parties have pledged to lift the general land tax threshold from $50,000 back to $300,000 if they win the state election on 28 November 2026. Neither change is law yet. Labor would phase it in over six years and the Coalition over five.
Labor says the first $25,000 increase would apply for 2027/28 and be delivered in its first budget. Three more $25,000 steps follow to 2030/31, taking the threshold to $150,000, with the full $300,000 restored by the end of 2033/34.
Under current rates, holdings from $50,000 to below $100,000 pay a flat $500 and holdings from $100,000 to below $300,000 pay $975. Owners whose holdings fall under the new threshold would stop paying that charge. Labor puts the maximum saving at $975 a year.
Labor costs the change at $230 million over five years. It points to $70 million from consolidating the government car fleet, $798 million from delaying level crossing removals, and more than $100 million from fewer public service executive roles.
For individuals, New South Wales starts at $1,075,000, Queensland at $600,000, South Australia at $936,000 for 2026/27, Western Australia at $300,000 and Tasmania at about $125,000. The ACT has no threshold and the Northern Territory has no land tax.
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Last updated: October 2026
General Information Only: This article is intended for general informational purposes and does not constitute legal, tax or financial advice. The Good Builder is not a law firm, tax agent or licensed financial adviser. Election commitments may change and are not law until legislated. Readers should seek appropriate professional guidance before acting on any information contained herein.
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