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Treasurer Tim Pallas MP has delivered Victoria’s 2024-25 State Budget.

2024-25 Victorian State Budget

Laura Dorgan

Treasurer Tim Pallas MP handed down Victoria’s 2024-25 State Budget on 7 May 2024. In his speech, the Treasurer stated this year’s Budget makes a range of decisions while continuing to invest in health, education, transport and housing. Furthermore, the Government is responding to capacity constraints in the economy, and inflation by taking the following four actions:
  1. Investing in workers’ skills to tackle labour shortages
  2. Aligning the infrastructure program to better reflect workforce capacity
  3. Supporting Victorian families with targeted cost-of-living help
  4. Stabilising, then reducing, net debt to GSP, in line with the Government’s strategy
The Government is forecasting operating surpluses of $1.5 billion in 2025-26 and $1.6 billion in 2026-27 which is an improvement from the 2023-24 Budget Update.

Some of the key measures announced in this year’s Budget include:
  • A one-off $400 School Saving Bonus for every student enrolled at a government school and eligible families at non-government schools. This bonus is meant to help with costs associated with uniforms, camps, excursions and sporting events.
  • $11 billion for the healthcare system
  • $1.8 billion to build, maintain and upgrade schools across Victoria
  • $1.7 billion to build and improve our hospitals and health facilities, including new emergency departments for the Northern and Austin Hospitals, and a new inpatient tower for the Monash Medical Centre
  • $996 million to switch on our Big Build transport projects, including the Metro Tunnel and the West Gate Tunnel
  • $700 million to extend the Victorian Homebuyer Fund, helping more Victorians to purchase their own home
  • $555 million to build the workforces we need for the future, including support for skills and TAFEs
  • $374 million to protect children and support families, including early intervention to keep families together, and assistance for carers
  • $302 million to support fire and flood impacted communities – helping them recover and rebuild for the long term, including repairing the roads most damaged by flooding earlier this year
  • $273 million to support Aboriginal families and communities, alongside our nation-leading Truth and Treaty work
  • $211 million to help keep women and children safe and support victim survivors of family violence
The Budget also invests $40 million for LaunchVic to continue fostering the capabilities and confidence of future innovators, creators and entrepreneurs. This includes support to increase access to capital for women entrepreneurs.

Some changes which were announced last year but will apply from 1 July 2024 include:
  • Payroll Tax Thresholds: Increasing the tax-free threshold for payroll tax to $900,000 (from $700,000) from 1 July 2024 and subsequently to $1 million from 1 July 2025
  • Business insurance duty: The rate of insurance duty (currently 10%) on fire and industrial special risks, public and product liability, professional indemnity, employers' liability, and marine and aviation insurance will be reduced by 1 percentage point each year from 1 July 2024
  • Stamp duty on Commercial and Industrial properties: The Government is implementing a gradual elimination of stamp duty on commercial and industrial properties. Properties that are sold from 1 July 2024 will pay stamp duty one last time. After that, stamp duty on the property will be replaced with a more efficient ‘commercial and industrial property tax’ based on unimproved land value payable annually from 10 years after the property was transacted. If the same property is sold a second or subsequent time, stamp duty will not apply as long as the property continues to be used for a commercial or industrial purpose. The commercial and industrial property tax will be set at a flat 1% of the property’s unimproved land value per annum.