Windfall Gains Tax (WGT) is a tax that a landowner will incur on the increase in land value as a result of the land being rezoned, where the increase in value from the rezoning is more than $100,000. It was first announced by the government on 15 May 2021 and is set to commence from 1 July 2023.

What land does Windfall Gains Tax apply to?

Any land in Victoria that is rezoned will be subject to WGT from 1 July 2023 unless an exemption applies.  Exemptions are limited to the following:

  • Transitional arrangements exempt some land subject to a pre-existing contract of sale or option prior to 15 May 2021
  • Some rezonings that were underway before 15 May 2021
  • Up to 2 hectares of land used for residential purposes
  • Land owned by a charity if the land is used and occupied for charitable purposes for 15 years
  • To correct technical errors in the Victorian Planning Provisions or planning scheme
  • Rezoning’s relating to land which is within an area to which the Growth and Infrastructure Contribution applies and land which is rezoned to a public land zone
How is Windfall Gains Tax calculated?

The taxable value uplift is the difference in the capital improved value of the land before and after the rezoning takes effect, less any deductions. Valuations, based on the capital improved value of land, will be undertaken by the Valuer-General Victoria on the pre-rezoning value and the post-rezoning value of land.

Aggregated Taxable Value UpliftWGT Rate
$0 to $100,000Nil
$100,001 to $499,99962.5% of uplift above $100,000
$500,000 or more50% of total uplift

The State Revenue Office has prepared a fact sheet that provides further information on how WGT is calculated and applied along with an example you can work through.

Who pays Windfall Gains Tax and when is it payable?

The owner of the land is liable for any WGT and the liability arises at the time the rezoning occurs.

It is possible for landowners to defer payment of the liability until the earlier of:

  • 30 years after the rezoning
  • a dutiable transaction (other than certain excluded dutiable transactions) occurring in relation to the rezoned land
  • a relevant acquisition (other than certain excluded relevant acquisitions) occurring in respect of a landholder who is the owner of the rezoned land

The State Revenue Office will administer the WGT regime.  It is important to note that any deferred WGT liability will accrue interest daily at the 10-year bond rate and will also constitute a first charge on the relevant land, with the provision to include WGT information on property clearance certificates.

Contact Us

The introduction of WGT will have a significant impact on some landowners so it is important you are aware of this regime and how it may apply to you. Should you require further assistance in relation to WGT and how it may affect you, please contact your Davidsons team member on (03) 52216399 or at

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Disclaimer: This information is of a general nature and should not be viewed as representing financial advice. Users of this information are encouraged to seek further advice if they are unclear as to the meaning of anything contained in this article. Davidsons accepts no responsibility for any loss suffered as a result of any party using or relying on this article.

This article was written by Tax and Business Services Manager Carolyn Grills-Harte.


Department of Treasury and Finance Victoria. (2022, February 24). WINDFALL GAIN TAX. Department of Treasury and Finance Victoria.