Insights Library
Key changes to Victoria’s GAIC regime
Planning Amendment (Better Decisions Made Faster) Act 2026
| At a glance. The reforms amend the trigger events and timing for payment of the GAIC liability on staged subdivisions of land that create child titles (also known as superlots) which may be favourable for developers from a cash flow perspective provided that the appropriate strategy is in place. The reforms also include additional amendments to introduce the ability to make an advance payment of GAIC, broaden the permitted use and reporting of GAIC funds. |
The Planning Amendment (Better Decisions Made Faster) Act 2026 introduces targeted changes to the growth areas infrastructure contribution regime under the Planning and Environment Act 1987 (Vic) (P&E Act).
Most of the GAIC reforms commenced on 3 June 2026. However, the provision dealing with GAIC on the creation of a child lot (being proposed s 201S(5)), was excluded from that commencement and is not yet operative.
Proposed treatment of child lots and balance land
The Act will insert a new s 201S(5) into the P&E Act which deals with a subdivision that creates a new child lot from a larger parcel (or otherwise known as a superlot).
Where the issue of a statement of compliance is the first GAIC event in respect of land, the provision provides that the GAIC liability will only be triggered on the newly created child lot. GAIC will not be triggered on the balance of the parent title at that time. Instead, the next GAIC event that occurs in relation to any part of the balance land will be treated as a first GAIC event for that land.
In practical terms, the reform will facilitate the creation of a development parcel or superlot without triggering GAIC across the whole parent holding at the same time. This may provide greater flexibility when structuring and staging the development of large growth-area landholdings and assist developers from a cash flow perspective. This provision may continue to apply to each further subdivision of the balance land that creates further superlots.
This reform is however not yet in force, but developers should have regard to it as part of any future development strategies.
Advance payment of GAIC
New s 201SWA allows a person who would become liable for GAIC on a future GAIC event to request the Commissioner of State Revenue to agree to an advance payment.
The advance payment is calculated at the GAIC rate applying on the date of the request. The request is itself treated as a GAIC event. If the Commissioner agrees and the payment is made, GAIC is not imposed again when the anticipated future event occurs.
Advance payment may assist a landowner or developer seeking to fix the applicable rate or resolve the GAIC position before a future sale, subdivision or development event. Its commercial value will depend on the timing of the project and the cost of bringing the payment forward.
Expanded application of GAIC funds
The amendments broaden the permitted use of revenue held in the statutory GAIC funds. In particular, GAIC funds may now be applied to infrastructure that services a growth area even where that infrastructure cannot reasonably be located within the growth area itself.
The Growth Areas Public Transport Fund is also renamed the Growth Areas Transport Fund, reflecting its broader permitted application. The changes allow funding to be directed to a wider range of transport infrastructure, including walking and cycling infrastructure, together with certain associated land, operating and administrative costs.
The Building New Communities Fund is similarly clarified so that eligible infrastructure may be located outside a growth area where it services that growth area and cannot reasonably be located within it.
Implications for developers and landowners
The reforms will assist developers with managing the GAIC liability from a cash flow perspective provided they have the appropriate subdivision strategy in place. = However, developers should not rely on this reform until it has commenced.
The advance-payment mechanism provides another option for parties seeking certainty or to reduce the potential GAIC liability (noting that each year the rates are generally increased) before a conventional GAIC event occurs. The appropriate GAIC strategy should however be considered with reference to the existing deferral, staged-payment and work-in-kind mechanisms.
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