Farmers to be spared fire tax increase after months of backlash

Premier Jacinta Allan has announced a one-year pause on a contentious tax hike for farmers following mass protests and lobbying, in a move that will wipe $73 million from Victoria’s budget surplus.

The increase to emergency services and volunteers levy will proceed as planned on residential properties but has been suspended for a year for Victorian farmers, many of whom are struggling through drought conditions.

Victorian sheep and beef farmer Bernie Free on his property near Winslow, where the effects of the drought are being felt.Credit: Joanne O’Keefe

The opposition, Victorian Farmers Federation and firefighters were among those opposed to the levy increase, which would have doubled the tax rate charged to property owners from July 1.

To secure crossbench support for the changes, Treasurer Jaclyn Symes earlier this month agreed to reduce the variable rate charged to farmers from 83¢ for every $1000 of a property’s capital improved value to 71.8¢. It is currently 28.7¢, and after the backflip it will remain at that level for one year.

Residential charges will rise from 8.7¢ to 17.3¢ as planned.

The reduced rates agreed with Symes did not appease the Victorian Farmers Federation and other advocates at the time, who said drought-stricken farmers could not handle the increase during difficult economic and environmental conditions.

Benalla farmer Stuart Green told The Age his levy would have increased from about $1000 to $2500, an untenable amount given his rising costs, including buying feed for his animals, who can’t graze in a bone-dry paddock.

Reflecting the strength of the backlash in regional communities, Labor MP for Ripon Martha Haylett wrote on Facebook this week she opposed her party’s increased tax for farmers.

“I have continued to represent my community by directly lobbying the Victorian government to fix the Emergency Services and Volunteers Fund,” she said at the time.

“Although I was glad to see some amendments made two weeks ago, it is clear these changes don’t go far enough.

“I have spoken directly to the treasurer and premier to make them aware of my community’s views. It is clear the way this levy has been calculated has a disproportionate impact on farmers. It is not fair, and I will keep fighting to fix it.”

Fire trucks outside state parliament in Melbourne on May 20.Credit: Chris Hopkins

Country Fire Authority volunteers walked off the job earlier this month, and firefighters joined farmers and opposition politicians on the steps of parliament for a raucous protest against the tax increase on May 20, the day the Victorian budget was released.

The Allan government had previously announced that farmers in 24 drought-affected local government areas would pay a reduced levy, capped to the same 28.7¢ they paid in 2024-25. This will now be expanded to all primary production properties.

The one-year pause means the levy could increase for farmers just months out from the 2026 election, setting the stage for another political fight unless the government decides to extend the freeze.

Symes said capping the levy for primary producers would help farmers stay focused on their drought response and recovery.

It is expected to cost $73 million in the 2025-26 financial year, putting a dent in the Allan government’s forecast $600 million surplus.

The existing levy is expected to bring in $1 billion in 2024-25, and the changes were forecast to increase this revenue to $1.6 billion in 2025-26. Annual revenue from the tax after that is projected to rise to $1.8 billion.

Symes said the freeze wouldn’t affect government commitments, and she remained confident of a surplus.

“There are a range of measures across the government that we’re looking at in relation to saving measures and the like,” she said.

Allan also announced an additional $37.7 million for drought support amid reporting from the Bureau of Meteorology that dry conditions were forecast to continue into June.

The money will ensure farmers can access up to $5000 for drought management upgrades, on top of financial counselling and mental health support.

These payments will increase to $10,000 across 11 council areas identified as heavily affected by drought.

Victorian Farmers Federation president Brett Hosking said the government’s decision was a step in the right direction and offered farmers some hope.

Victorian Farmers Federation president Brett Hosking. Credit:

Despite welcoming the pause, Hosking insisted the levy was an unfair tax shifted onto farmers.

“We’ll use this extra time to continue making the case that it needs to be scrapped altogether, not simply paused,” he said.

Before the government backflip, Hosking estimated the amount he would pay for the levy would increase from $12,000 to $20,000. “It’s a massive hit,” he said last week.

Dairy Farmers Victoria president Mark Billing said CFA volunteers had reacted angrily when the increased levy was announced because many of them were farmers, too.

“In my local brigade, we’re nearly all dairy farmers,” he said.

Billing said announcing the increase during a drought also angered many people in rural Victoria.

“It’s been a passionate subject in most of Victoria, particularly in the south-west because of the conditions we’re facing.”

Billing said he was pleased the government had listened to farmers’ frustrations and paused the increase. But he agreed the increase should be scrapped altogether.

“It’s still hanging over us as a potential tax that really is not fair.”

Agriculture Victoria has provided advice to government that May rainfall for farmers was in “the worst-case scenario” it had modelled at the start of the month.

Over the past fortnight, most of the state received 20 per cent or less than typical rainfall expected this time of year.

A new drought response taskforce will be set up to decide on further support packages as conditions worsen.

This will include Symes along with Agriculture Minister Ros Spence, Water Minister Gayle Tierney and Nationals MP Peter Walsh.

“The increasingly devastating effects of drought aren’t confined by postcode or region – it’s impacting farmers across Victoria. It’s why we’re expanding support statewide,” Allan said.

“The new taskforce will bring together Victorians from different communities, different backgrounds and different political parties. Most importantly, it’ll be focused on delivering real relief for farming communities.”

Allan, who lives in and represents Bendigo East, said rural and regional Victorians were watching the ground dry before their eyes.

“Usually at this time of the year, the ground is lush. The crops are starting to come out of the ground,” she said.

“I’m seeing the impact in my community, and then seeing it replicated across the state.”

Opposition agriculture spokesperson Emma Kealy said the announcement did not provide the urgent relief that was required.

“While doubling drought resilience infrastructure grants and deferring the emergency services tax on agricultural land for a year may sound helpful, it does little to provide immediate support for farmers who are at breaking point,” Kealy said.

“Delaying Labor’s emergency services tax is simply delaying what is an unjustified and unfair tax on Victorian producers – whether it’s drought conditions or not. The tax should be scrapped entirely.”

United Firefighters Union secretary Peter Marshall said businesses and home owners would still be hit by the tax increase, which he said should be discarded rather than paused for some.

“The laws will remain on the books, and the tax will hang over the heads of every Victorian – including farmers, business and home owners – for every year to come.

“We need to see this extra tax discarded entirely, and the laws that enable it repealed so it cannot be reintroduced when the government is no longer facing the intense political pressure that recent protests have produced.”

Victorian Chamber of Commerce chief executive Paul Guerra said businesses across Victoria could not bear additional costs, given the high costs they were already facing.

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