As part of the Gillard Government's election commitment, the
Planning and Environment Amendment (Growth Areas
Infrastructure Contribution) Act 2011 was enacted on 29 June
2011 which sets out major changes to the Growth Areas
Infrastructure Scheme (GAIC) Scheme.
100 Percent Deferral
The existing 70% deferral of a GAIC liability for a
dutiable transaction on lands in the contribution areas has now
increased to 100% in respect of land transfers with a settlement
date on or after 30 June 2011 or significant acquisitions made on
or after that date.
There is now scope to partly or fully settle GAIC liability
"in-kind" instead of strict cash payments by entering
into 'work-in-kind '(WIK)
agreements. To be administered by the Growth Area Authority
(GAA) and the State Revenue Office
(SRO), these agreements provide for land or works
instead of cash payment in discharge of a GAIC liability.
Key notes to consider include:
The subject property must be in a growth area and ably funded
from the Growth Areas Public Transport Fund or Building New
The agreement must be entered into before the due date for GAIC
liability (but may be entered into to discharge a GAIC liability
which arose prior to 30 June2011);
A WIK agreement is subject to the approval of the State
A consultation process must be conducted by the Minister to
ensure no other minister has interest in the subject matter of the
The Treasurer's approval is required for WIK agreements
with a GAIC liability of over $2 million. This could be an issue
for large-scale developers.
WIK agreements must be registered in land titles and the Land
Registrar must be notified to restrict dealings on subject
lands. Failure to comply with the terms of the WIK agreement
shall make the whole GAIC amount immediately payable as if the GAIC
had never been deferred or staged and relevant interest and penalty
Broadly, the following were also set out to enhance the
operation of the GAIC scheme:
From 1 July 2010, a GAIC exemption applies to land that is a
small lot of 0.41 hectares or less which is either a lot in a plan
of subdivision or a lot created by an excluded subdivision.
All applications for reduction or exemption from GAIC in
exceptional circumstances should be made to the Minister (rather
than to the Governor in Council).
The due date for payment of GAIC on application of reduction,
exemption or relief is the later of original due date of the GAIC
or 14 days after being notified of the outcome of the
Any deferred GAIC liability that is rolled over to a new owner
due to a subsequent dutiable transaction will include any interest
accruing on the deferred amount.
If you hold a property in the Melbourne growth areas and would
like to know how these changes could impact your property dealings,
please contact Stephen O'Flynn on (03) 8635 1986.
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