GAIC = Growth Areas Infrastructure Contribution

The GAIC is a tax introduced by the former Victorian Brumby Government of $80,000 per hectare for land included in Melbourne's Urban Growth Boundary (UGB) in 2005, and $95,000 per hectare for land brought into the UGB in 2010. It is to be charged at a flat rate regardless of sale price, and is payable on the "first property transaction" and therefore upon sale, transfer or subdivision. It affects thousands of property owners on Melbourne's fringes.

Whats wrong with the GAIC legislation?

• Charged at the ‘first property transaction’, not at development stage.
• Charged at a flat rate per hectare regardless of sale price.
• Charged on the gross land area irrespective of development yield.
• Affects inheritance – applies if a will directs that property be sold and divided by beneficiaries.
• Applies if a marriage breakdown requires the family home be sold.
• Leads to a massive reduction in equity and borrowing capacity.
• In effect freezes personal land assets until development is imminent (which could be decades away) but landowners will be hit with immediate rate increases.
• Changes the whole principle of land ownership – an estate in fee simple. The highest form of land ownership in the country means nothing if the value of that property can be eroded through government intervention.