Emergency services tax to push farm rates up by 33 per cent

Farmers expecting their rate notices to remain steady are in for a shock, as the Victorian government’s new emergency services tax pushes their bills up.

Victorian Premier Jacinta Allan’s and Treasurer Jaclyn Symes’ new emergency services tax will add 33 per cent to most farm rate notices.

Farmers expecting their 2025-26 rate notices to remain steady or fall in the wake of a drop in rural land values are in for a shock, as the Allan Government’s new emergency services tax pushes their bills up by a third.

Local councils have started releasing draft 2025-26 budgets, which show most rural land values have stagnated or declined over the past 12 months.

But any hope of a respite from a decade of skyrocketing rural rates have all but been wiped out by the Allan Government’s push to rebadge the current fire services property levy as an Emergency Services Volunteer Fund tax – tripling farmer contributions.

Victorian Farmers Federation president Brett Hosking said farmers who were already paying $30,000 in rates this year “will be hit with an extra $10,000”.

Ararat Rural City Council just published a draft 2025-26 budget that shows farmers can expect the headline number on their rate notices to jump by 34 per cent, despite hardly any movement in rural land values.

The council’s draft budget estimates farmland values have dropped by 3.6 per cent, from a total of $4.47 billion in 2024-25 to $4.32 billion next financial year.

The decline means the year-on-year amount Ararat council expects to collect from farmers will rise by just 1.8 per cent, from $6m this financial year to $6.1m in 2025-26, well below the 3 per cent fair go rates cap.

But the amount the council must gather on behalf of the state government will rise from $1.28m under the FSPL to $3.6m under the ESVF tax.

It means the headline number on rate notices arriving in farmers’ email and post boxes mid-August will be up 33 per cent on this financial year’s bill.

The impact is set to be repeated across Victoria’s 48 rural and regional councils.

Mr Hosking wants Treasurer Jaclyn Symes needed to explain why farmers had been lumped with a three-fold hike in the ESVF tax, compared to a two-fold hike for residential, commercial and industrial property owners.

“There’s no good reason for such an increase,” Mr Hosking said. “There’s just not the capacity to pay, especially for those hit by drought.”

Brett Hosking at his Oakvale farm. Picture:Rob Leeson.

Ms Symes’ office said the levy hike was “about making sure our emergency services have the sustainable funding and equipment they need to keep Victorians safe and to recover from natural disasters – disasters which are happening more often and impacting farmers and their properties”.

Her office also said farmers who were CFA or VICSES volunteers would be eligible for a ESVF rebate on their principal place of residence or on their farm.

But the rebate is capped and the government has only set aside $6 million to cover the rebate for 55,126 CFA and VICSES volunteers, equating to an average $109 each.

All up, Victoria’s farmers face paying an ESVF bill of $204m on their rates notices from July 1, including those in shires where land values have slumped.

In South Gippsland the local shire’s draft 2025-26 budget shows land values have dropped 5.36 per cent.

As a consequence the council estimates the rate revenue it collects from farmers will drop from $13.8m this financial year to $13.3m in 2025-26, down 3.74 per cent.

But that $500,000 in rate savings will be obliterated by the $5.3m in ESVF tax that South Gippsland farmers must pay on $13.3bn worth of land in 2025-26, an almost three-fold increase on the $1.9m in FSPL they paid this financial year.

The outlook for farmers living in the few rural shires where land values have risen is even bleaker.

In the state’s north Loddon Shire Council’s draft budget has rural land values rising from $4.13bn this financial year to $4.47bn in 2025-26, a rise of 8.3 per cent.

The council has decided to wind back the rural rate hike to 4.2 per cent, but it still means farmers’ year-on-year contribution to its budget rises from $7m to $7.37m – equal to 75 per cent of the shire’s rate revenue.

The shire must then add an Allan Government ESVF tax of $3.71m to farmers rate notices from July 1, up from an FSPL of $1.18m in 2024-25.

It means Loddon Shire farmers can expect to see the headline number on their rates notice surge by an average 36 per cent.