Greens unveil plan to hit property owners with new tax to revive shopping strips

Melbourne property owners would be hit with another tax under a radical push from the Greens to “revive” bustling shopping strips such as Chapel St and Smith St.

Melbourne property owners would be hit with another tax under a new push to “revive” bustling shopping strips, such as Chapel St and Smith St.

Ahead of the upcoming Prahran by-election, the Greens have unveiled a radical push to whack a two per cent commercial vacancy tax on all properties within metropolitan Melbourne that have sat empty for six months of the year.

But the move has already been slammed by business leaders who said it’s the last thing that the industry needs – and could actually destroy shopping strips.

The minor party has previously suggested such a tax but has never formally launched the policy or had it costed.

Greens candidate for Prahran Angelica Di Camillo said money from the tax would be injected back into shopping strips.

The Parliamentary Budget Office (PBO) forecasted the tax would raise more than $258m in state revenue over the forward estimates.

Greens Prahran candidate Angelica Di Camillo said that money would be injected back into shopping strips across Melbourne, and could be used to let artists and pop-ups operate out of vacant stores.

Ms Di Camillo said the new tax would incentivise property investors to rent out their stores instead of letting them sit empty.

“In Prahran, Chapel Street is the beating heart of our community. It is arguably one of Melbourne’s most iconic spots but over recent years, landlords jacking up the rent and the ongoing cost of living has forced many traders to close,” she said.

“It is so sad to walk down your local shopping street and see empty shops that were once the local grocer, boutique, or restaurant you used to love.”

But Victorian Chamber of Commerce and Industry acting chief executive Chanelle Pearson said the latest tax grab was flawed.

“The commercial reality is business cannot withstand any new taxes and this proposal would only shift the cost to taxpayers when the landlord claims company tax from the federal government,” she said.

“It’s not in the interests of commercial property owners to have their property sitting vacant, in the vast majority of cases they are struggling to fill their shops and pay their mortgages in a challenging economic climate.

Many Chapel St traders have been forced to close their businesses. Picture: Andy Brownbill

“When a property is vacant – insurances and other costs for their building rise dramatically. A vacancy tax could leave struggling shopping strips in a worse position with landlords abandoning properties altogether in search of more lucrative investments.”

The Greens will battle the Liberals – but not Labor – for the inner city Melbourne seat after former MP Sam Hibbins admitted to having an affair with a staffer. He was subsequently accused of inappropriate behaviour toward an intern in 2016.

The Liberal Party held the seat from 1985 until 2002 when it was won by Labor. The Liberal Party regained the seat in 2010 before losing it to the Greens in 2014.

Voters will head to the polls on February 8.