‘Australia’s stupidest tax’ has grown to a record high — and will be added straight to power bills

A sneaky state land levy that is added to every Victorian power bill and has been slammed “Australia’s stupidest tax” has just got a whole lot “stupider” after growing to a record new high.

A sneaky state land levy that gets passed through to Victorians via power bills has been dubbed “Australia’s stupidest tax”, after it soared to a record $268 million.

The easement tax, which is applied to land where high voltage power lines are built, now pushes up bills by an average of more than $70 a year.

It was created in 2004 to fund a subsidy for the Alcoa aluminium smelter, and is pegged to rising land prices.

The hit to households has outraged industry and social service groups, who say it is adding more pressure to those feeling the cost of living pinch.

But the Allan Government has refused to consider ditching the tax, or even capping it.

Australian Industry Group climate change and energy director, Tennant Reed, said:

“The easement land tax remains Australia’s stupidest tax,” he said.

“Every year, as the price of land goes up, and as anxiety about electricity prices goes up, it gets stupider.”

The easement tax now pushes power bills up an average of more than $70 a year. Picture: Andrew Henshaw

Mr Reed said the government should scrap the tax but if they refused, they should at least cap it to give “relief for hard pressed industry and households”.

Energy Users Association of Australia chief executive, Andrew Richards, said the tax “continues the vice-like squeeze on costs” felt by industry.

He said they feared the tax was a forerunner for more costs to be shoved across to consumers once new transmission lines were built – a concern echoed by national director of energy policy and research at St Vincent de Paul Society, Gavin Dufty.

“The easement tax is a forever growing charge being silently added to household electricity bills, right at the time when households can least afford it,” he said.

“This tax will keep going up as we build more transmission lines and land values go up, and we believe it’s about time we had a review about the need for this tax.”

A spokesperson for Treasurer Jaclyn Symes says Victoria’s electricity bills are expected to fall over the next decade. Picture: Asanka Ratnayake

A spokesman for Treasurer Jaclyn Symes said Victoria’s electricity prices are expected to fall over the next decade.

“This year’s Budget delivered real help for families to cut energy costs, including a $100 Power Saving Bonus for some of the state’s most vulnerable families, cutting the cost of energy efficient hot water heat pumps, and one-on-one support with energy bills,” they said.

Shadow energy minister David Davis said Labor was “milking Victorian families dry with sneaky embedded taxes, including the special land tax on electrical poles and wires”.

“Jacinta Allan’s land tax on electricity wires adds directly to the surging power bills paid by Victorian families and businesses hitting hard in a cost-of-living crisis of its own making,” he said.

“It’s a harsh tax on everyday families, hidden from view but paid just the same.”

Originally published as ‘Australia’s stupidest tax’ has grown to a record high — and will be added straight to power bills