Victoria strengthens rent reductions for small businesses, extending relief by four months

Tim Pallas venture growth fund

Victorian Treasurer Tim Pallas. Source: AAP/Joe Castro.

The Victorian government has extended rent reductions for small businesses that continue to suffer under tough COVID-19 restrictions across the state.

Commercial landlords will now be required to provide rent reductions to tenants “in proportion” with falls in their turnover, while bans on evictions and rent increases will be extended until the end of the year, Victorian Treasurer Tim Pallas said.

“Up until now, that proportionality principle has been aspired to, but we will now make it a very clear and expressed intention that, if you’re identifying a downturn in your capacity, your turnover, then you should have an expectation that that is similarly reflected in terms of the rent relief that you get,” Pallas said.

Businesses had been expressing concern about their inability to begin paying their full rent bills at the end of September, when a commercial tenancy code legislated by the Victorian government earlier this year was due to expire.

Since stage four restrictions were imposed across Melbourne earlier this month, businesses argued there was a strong case for extending tenancy support.

Thursday’s announcement will ensure this support is available for at least another four months, and will actually strengthen the measures forcing landlords to grant rent reductions to tenants.

In return, landlords which provide outright rent waivers of at least 50% for three months will be eligible for an additional 25% reduction in their land tax bills, while small landlords will be able to apply for $3,000 in hardship funding under a $60 million support program.

Asked how much forgoing land tax revenue would cost the state government on Thursday, Pallas said he was hesitant to float a dollar figure, saying access to further rent relief would be demand-driven.

“It’s about ensuring that we strike the right balance and provide support and assistance to landlords who do the right thing by their tenants,” Pallas said.

So far during the pandemic, the Victorian Small Business Commission — responsible for overseeing mediation under the tenancy code — has received more than 7,500 inquiries about accessing rent relief.

More than 1,400 applications for mediation have been lodged under the code, 524 of which have been finalised to date with a 90% success rate.

NOW READ: “We’d have to shut our doors”: Rent relief was a saving grace for small business — but it’s about to expire

NOW READ: Will my landlord reduce my rent? Morrison’s mandatory coronavirus rent relief package explained for businesses

Trending

COMMENTS

Subscribe
Notify of
guest
0 Comments
Inline Feedbacks
View all comments