The Real Estate Institute of Victoria (REIV) has called out the "unfair" system in place for the implementation of the land tax relief in the state, saying that the rules put commercial landlords at a serious disadvantage.
Under the current system, commercial landlords who provide tenants with rent relief may be eligible for a 25% discount on their land taxes. After the negotiations for rent relief, tenants must fill out an online form that will enable their landlords to apply for land tax relief.
Leah Calnan, president of the REIV, said the system in place is "overly bureaucratic" and is unfair to commercial property owners who have negotiated rent support in good faith.
"Our primary concern is that there are no incentives or consequences for the tenant if they fail or refuse to do this. The commercial property owner is at the mercy of their tenant to apply for the tax relief promised by the government," she said.
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The guidelines from the State Office Revenue states that for landlords to be eligible for the relief, tenants have to complete a form detailing their financial circumstances.
Calnan believes that while all stakeholders must be equally supported, it is also important to consider that majority of landlords are mum-and-dad investors.
"The process is not fair for the landlord and their agent who have, in good faith, negotiated rent reduction for the tenant as per government guidelines but are unable to claim the promised land tax relief because their tenant fails to complete the form," she said.
Calnan said there is a need for an alternative process to ensure that landlords are not "unduly disadvantaged."
"In order to manage the financial impact for both the landlord and the tenant, the rent relief could be only initiated after the form has been submitted or even better, the process scrapped," she said.
