Fire Services Property Levy
Frequently Asked Questions Public Inquiries
August 2012 MAV
The Fire Services Property Levy (FSPL)
Take a look at your home and contents insurance notice and you may see a charge
for a fire services levy. Insurers impose this charge on insurance premiums to
recover the cost of their contributions to fire services – the Country Fire Authority
(CFA) and Metropolitan Fire Brigade (MFB).
However, if you owned a property that was uninsured, you may not have been
contributing to these vital services.
The Victorian Bushfires Royal Commission recommended replacing the current
insurance-based funding model with a more equitable and transparent propertybased levy. The Government has adopted this recommendation and introduced
legislation for a Fire Services Property Levy (FSPL) to ensure that all Victorian
property owners pay a fair contribution to our fire services.
This change means that from 1 July 2013, all Victorian property owners will make an
annual financial contribution (to be included on their annual council rates notice) to
the state’s fire services.
How is the FSPL calculated?
The FSPL is calculated by using the capital improved value (CIV), land use
classification and location of your property.
The levy is calculated using the following formula:
Levy = fixed charge + (CIV x levy rate) – concession (if any)
Property owners will contribute to the fire service that covers their area. This means
that there will be different levy rates for the CFA and MFB areas.
What is the fixed charge?
This charge is the fixed amount of levy payable on each property. For 2013-2014, the
fixed charge on residential property (including vacant residential land) will be $100
and the fixed charge for commercial, industrial, primary production, public benefit and
vacant land will be $200.
The amount of the fixed charge will be indexed annually in accordance with
movements in the consumer price index.
What is a land use classification?
The land use classification describes the primary use of your land. There are six
different property classifications:
•
Residential
•
Commercial
•
Industrial
•
Primary production
•
Public benefit
•
Vacant
Each property classification will have its own rate. While the rates have yet to be
determined, it is expected that residential, primary production and public benefit
property will have a lower rate than industrial and commercial property.
What is the CIV?
The CIV is the value of your land with improvements as determined by your council.
A revaluation of land is completed by each of Victoria’s 79 municipalities every two
years in accordance with guidelines specified by the Valuer-General of Victoria.
Where do I find my CIV?
Your CIV is located on your local government rates notice.
What if I disagree with my CIV?
If you disagree with the value of your property as listed on your rates notice, please
contact your council for more information.
When are we changing to the FSPL?
The FSPL will commence from 1 July 2013. Property owners will pay their FSPL as
part of their council rates notices, which are issued annually from July.
How do we currently pay for fire services?
Victorians currently pay for the fire services through levies collected on insurance
policies, which attract stamp duty and GST.
The Government makes an annual contribution to the funding of fire services, as do
local governments located within the MFB area.
What is the FSPL legislation?
The FSPL will be collected in accordance with the Fire Services Property Levy Act
2012, which legislates that all Victorian property owners are liable for a financial
contribution (via the FSPL to be included on their annual council rates notice charge)
to the state’s fire services.
Will I pay more under the new scheme?
The financial impact on any individual property owner will depend on a number of
variables, including the value of your property, the classification of your property,
your eligibility for a concession, and what you are paying under the current
insurance-based funding model. However, the average residential fully insured
property owner should pay a lower FSPL than they currently pay.
Are there any concessions?
There will be a $50 concession (only one per property) for holders of pensioner
concession cards and Department of Veterans’ Affairs gold cards on their principal
place of residence. This will be administered in the same way as the rates
concession.
Will there be stamp duty or GST on the FSPL?
Insurance premiums, including any fire services levy imposed by the insurer, are
subject to stamp duty and GST. There will be no stamp duty or GST on the FSPL,
and the Government will forgo this “tax-on-tax” component.
What happens if I cannot pay the FSPL?
Councils will be able to waive or defer the whole or part of the FSPL on the grounds
of financial hardship, as they do with rates. However, a council can waive or defer
the FSPL payment only if it also waives or defers payment of rates for that specific
property.
If a property owner does not pay their FSPL, all councils are expected to take steps
to recover outstanding amounts, which may include charging interest and launching
court action.
How do I pay the FSPL?
Councils will list the FSPL on the rates notice for rateable properties. You will be able
to pay the FSPL in the same manner as your rates. This means that you will be able
to pay the FSPL in four instalments.
Is there an FSPL on vehicles?
There will not be an FSPL on personal property (contents) or motor vehicles as there
is no existing valuation process or comprehensive valuation base upon which to
impose the FSPL.
A motor vehicle levy would also increase collection costs and duplicate collection of
the FSPL from owners of both real property and motor vehicles.
Can I pay in installments?
The FSL charges will be included in installments.
For example
Rates 2013-14
Waste
FSPL
Total
$800
$200
$200
$1,200 Divided by four installments $300 each