On 1 January 2020, the State Government implemented the combustible cladding levy to fund rectification works for high-risk buildings. The levy will apply to all Building Permit Applications (including staged permit applications) received by building surveyors on or after 1 January 2020 and is IN ADDITION to the current building permit levy.
The new levy applies to buildings:
- with a classification of 2 to 8;
- that are not located in ‘regional Victoria’; and
- that have a cost of works of $800,000 or more.
Summary of applicable classes:
Class 2 – apartments
Class 3 – hotels
Class 4 – dwellings attached to commercial buildings
Class 5 – offices
Class 6 – shops
Class 7 – car parks and warehouses
Class 8 – laboratories and factories
What are the rates of additional cladding rectification levy payable?
For buildings with a cost of works (single-stage project) or cost of the entire building works (multiple stages of works) of $800,000 or more, the following rates of cladding rectification levy are payable.
Cost of works | Cladding rectification levy rate |
Between $800,000 and $1 million | 0.128 cents in the dollar |
Between $1 million and $1.5 million | 0.256 cents in the dollar |
$1.5 million or more | 0.82 cents in the dollar |
An online levy calculator is available to provide an estimate of the total building permit levy payable.
- If a permit is required for a building with multiple classifications, including Classes that do not attract the new levy (Class 1, 9 or 10), the cladding rectification levy is calculated on the entire cost of works for that project;
- The cladding levy is calculated on the total cost of works, not just the part that exceeds the various thresholds noted in the above table; and
- If a Building Permit Application received after 1 January 2020 is for a staged permit, the cladding levy is calculated on the cost of works for that stage only and does not apply to previous stages issued prior to 1 January 2020
For further information, please visit the VBA website
Related Posts
December 12, 2019
Cladding Rectification Levy
An additional building permit levy is being introduced by the Victorian Government to fund…
October 24, 2018
Power to Ban Cladding
Proposed amendments to the Building Act address the Victorian Cladding Taskforce's Interim Report…
March 25, 2019
Building Permit Levy Changes
On 1 July 2019, the way in which the building permit levy is paid to the VBA will change.…