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Tax burden for land owners, buyers and developers
The Victorian Growth Areas Infrastructure Contribution (“GAIC”) operates from 1 July 2010. Importantly, the GAIC remains retrospective to transfers, building permits or subdivisions since 2 December 2008.
Some purchasers unknowingly became liable for GAIC of $80,000 per hectare on 1 July and will need to consider deferral options by 30 September 2010.
A GAIC liability can potentially pass to a subsequent purchaser under the GAIC deferral system. It is critical to understand your exposure to GAIC if you buy or develop land within the expanded urban growth boundary.
The GAIC for the new expanded urban growth boundary is $95,000 per hectare (indexed). Interest on late payments is levied at 12.8% pa. Interest is payable at approximately 6% pa under the deferral system (2010/2011).
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