Background
This matter concerned the lands’ liability for land tax for 2020 land tax year. The lands were claimed to be under construction for a retirement village. However, no building permit had been issued for the lands as at 31 December 2019.
Issue
Whether the exemption in s 78A of the Land Tax Act 2005 (the Act), as land under construction for certain exempt uses (in this case a retirement village) applied to the lands for the 2020 land tax year.
Decision
On 28 August 2023, the Tribunal found in favour of the Commissioner and ordered that the assessment of land tax for the 2020 land tax be confirmed.
In doing so, the Tribunal found that:
- in accordance with s 36 of the Act, and with reference to the Court of Appeal’s decision in Rainn Pty Ltd v Commissioner of State Revenue [2016] VSCA 338, the date for determining whether the subject lands are exempt for the 2020 land tax year is 31 December 2019
- when s 78A is read with s 36, the exemption will only be available for the 2020 land tax year if the construction of the retirement village commenced by no later than 31 December 2019
- with reference to Lifestyle Investments 1 Pty Ltd v Commissioner of State Revenue [2019] VCAT 920, construction commences on the date the building permit is issued, which in this case was not until 23 January 2020.
