You must pay a levy on certain planning permit applications to accommodate Melbourne's rapid growth

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Melbourne is growing rapidly, with a projected population of up to 7.7 million by 2051. The scale of this expected growth requires strategic long-term planning under the guidance of the Victorian Planning Authority.

The metropolitan planning levy (MPL) will be used to fund this authority and its Plan Melbourne initiative, a long-term strategy to accommodate Melbourne’s growth. Our role is to administer the levy under Division 5A of Part 4 of the Planning and Environment Act 1987 (the Act).

What is the levy?

You have to pay the MPL if you want to apply for a planning permit on or after 1 July 2015 to develop land in metropolitan Melbourne and the estimated cost of the development for which the permit is required is more than the current MPL threshold.

If the estimated development cost is more than the threshold, you cannot lodge your planning permit application with the responsible/planning authority without a current MPL certificate

Estimated cost of development

The amount of MPL you have to pay is calculated on the estimated cost of the development for which the planning permit is required. This cost is shown in the planning permit application form, which is also used by the responsible authority to calculate the permit application fees.

If your application for a planning permit is to subdivide land, you will be liable to pay the MPL if the subdivision involves development works for which a planning permit is required and the costs of development exceed the MPL threshold. If there are works associated with the subdivision of land which do not require a planning permit, the costs of these works  should be excluded from the estimated development costs for MPL purposes. 

You can read more about estimated development costs for land subdivision in Planning Practice Note 82 (Applying-the-Metropolitan-Planning-Levy), issued by the Minister for Planning in May 2016.

Thresholds

The threshold for the 2016-17 financial year is $1,013,692.16. This is adjusted  by CPI on the 1 July each year. The threshold amount for 2015-2016 financial year was $1 million.

The MPL does not apply to an application to amend a planning permit under s72 of the Act, even if the total estimated cost of development allowed by the permit as amended is more than the current threshold.

Affected areas

The levy applies to an application for a planning permit to develop land in metropolitan Melbourne. This is:

  • The area covered by the Banyule, Bayside, Boroondara, Brimbank, Cardinia, Casey, Darebin, Frankston, Glen Eira, Greater Dandenong, Hobsons Bay, Hume, Kingston, Knox, Manningham, Maribyrnong, Maroondah, Melbourne, Melton, Monash, Moonee Valley, Moreland, Mornington Peninsula, Nillumbik, Port Phillip, Stonnington, Whitehorse, Whittlesea, Wyndham, Yarra and Yarra Ranges planning schemes, and
  • The area within the urban growth boundary in the Mitchell Planning Scheme

Levy rates

The MPL is $1.30 for every $1000 of the estimated cost of the development.

If the estimated cost of the development is not a multiple of $1000, it will be rounded up or down to the nearest $1000. If the amount by which it is to be rounded is $500, it will be rounded up.

Example

The estimated cost of the development to which a permit application relates is $2,356,782. This will be rounded up to $2,357,000 for the purpose of calculating the MPL.

$2,357,000 ÷ $1000 = $2357.

The MPL is ($2357x $1.30) = $3064.10

Apply for an MPL certificate

You apply for an MPL certificate by submitting an MPL application with us. In your application, you need to tell us the estimated cost of the development as well as other information.

The MPL application form will tell you how much MPL you need to pay based on your estimated development cost. When you submit your completed application, you must pay the levy to us by electronic funds transfer.

After we have received your MPL payment and all the information we require, we will issue you with an MPL certificate, which will state the relevant information including the estimated cost of the development.

Increased development cost

If your planning permit application requires an MPL certificate, your application will only be accepted if the estimated cost of development stated in the MPL certificate are equal to or greater than the estimated cost of the development stated in the planning permit application.

If the estimated cost of the development increases after you have received your MPL certificate but before you apply for your planning permit, and your MPL certificate has not expired, you can apply for a revised MPL certificate and pay us the additional MPL amount.

This additional MPL payment is calculated on the increase in the estimated development cost.

Example

The original estimated cost of the development to which a permit application relates is $2,356,782.

This will be rounded up to $2,357,000 for the purpose of calculating the MPL.

$2,357,000 ÷ $1000 = $2357.

The MPL is ($2357 x $1.30) = $3064.10

A month after the MPL was paid and an MPL certificate was issued, the estimated cost of the development increased by $200,000 before the planning permit application was lodged with the planning or responsible authority.

The additional amount of MPL payable is ($200,000 divided by $1000) x $1.30 = $260

Revised MPL certificate

You apply for a revised MPL certificate by submitting another application form, telling us the increased estimated cost of the development and any further information we require. You can then pay us the additional MPL amount.

Keeping records

You do not have to keep records for MPL purposes, although you may wish to keep a copy of the MPL certificate.

The planning or responsible authority must keep each MPL certificate given to them for no less than five years.

More about MPL certificates

Your privacy

We, as the organisation responsible for administering the MPL, must not disclose information obtained in relation to its administration unless it is:

  • With the consent of the person to whom the information relates,
  • In connection with the administration of the MPL,
  • In accordance with a requirement imposed under another Act,
  • To someone, or another organisation, who is authorised under legislation to receive it. Examples of authorised recipients are the Secretary to the Department of Treasury and Finance, the Secretary to the Department of Transport, Planning and Local Infrastructure, a relevant responsible authority, a relevant planning authority and a person prescribed to be an authorised recipient for the purposes of s96Y of the Act, or
  • If the information will not, or is not likely to, identify a particular person