Victorian landlords granted $420 million in tax concessions for reducing small business rents during coronavirus
The Victorian government will extend tax relief to landlords in exchange for a reduction in small business rents during COVID-19.
The Victorian government will provide $420 million in land tax relief to commercial and residential landlords who pass on rent reductions to tenants during the COVID-19 pandemic.
Victoria yesterday became the second state to announce it would give effect to rent relief measures agreed by national cabinet earlier this month, including by next Thursday legislating a new mandatory code of conduct.
Similar to measures already announced in NSW, Victoria will ban evictions for six months, freeze rent increases and force commercial landlords to grant rent relief to SME tenants suffering at least a 30% turnover reduction due to coronavirus.
In return, landlords will be offered a 25% discount on their land tax bill for 2020 and the ability to defer any outstanding payments until March 2021.
Echoing sentiments expressed by Prime Minister Scott Morrison, Victorian Premier Daniel Andrews encouraged small businesses to negotiate with their landlords.
“More than ever, we need to be working in partnership,” he said in a statement circulated Wednesday.”
“Landlords working with tenants. Tenants working with landlords. And government willing to help those most in need.”
The Victorian package is valued at $500 million, although unlike NSW, Victoria did not split the value of the package into commercial and residential assistance.
Businesses that struggle to reach deals with their landlords will be able to access a “fast-tracked” mediation service run by the Victorian Small Business Commission.
Although unlike NSW no additional funding was announced to bolster mediation services amid an expected flood of dispute inquiries in the coming months.
Australia’s two most populous states have now announced measures giving effect to national cabinet’s rent relief package while other jurisdictions are expected to follow suit in the coming weeks.
Commercial rent relief has been among the most pressing concerns of small business owners in recent weeks as many have been forced to shut up shop due to the coronavirus outbreak.
