Residents in Silverleaves, Phillip Island, challenge overvalued land tax due to flood risks
Consensus Summary
Residents in Silverleaves, a low-lying coastal town on Phillip Island, are successfully challenging their land tax valuations after a 2025 High Court ruling clarified that flood-prone properties should be assessed based on their site value as vacant land. Both ABC and The Age report that coastal erosionâwith the shoreline receding up to 16 metres since 2022âhas made much of the land undevelopable, yet valuations initially reflected higher potential use. Dozens of residents, including Ken Hailey and Natalie Gray, objected to their bills, securing reductions from amounts like $775,000 to as low as $85,000. The State Revenue Office (SRO) has only applied these changes to those who objected, delaying broader adjustments until 2027, a process critics call inequitable. While ABC highlights the SROâs inaction and residentsâ frustration, The Age broadens the issue to a potential statewide problem, noting over 200,000 Victorian properties face flood risks and urging a review of similar overvaluations. The opposition has called for an immediate correction of all incorrect valuations, with Nationals MP Melina Bath demanding refunds for overcharged households. Melbourne Water and the Department of Transport and Planning maintain their processes are consistent with state guidelines, though discrepancies remain over whether the High Court ruling directly triggered the valuation changes.
â Verified by 2+ sources
Key details reported by multiple sources:
- Residents of Silverleaves on Phillip Island are contesting land tax valuations, arguing they are overvalued due to flood and coastal erosion risks, with some receiving significant reductions (e.g., $775,000 to $175,000).
- The shoreline in Silverleaves has receded by up to 16 metres since 2022, with a 2024 Environment Department report finding 77 metres of recession since 1953 (6 metres per year between 2022â2024).
- A 2025 High Court decision ruled land tax should be assessed based on the site value of vacant land, prompting objections from Silverleaves residents.
- Melbourne Water and Bass Coast Shire Council previously refused a 2024 VCAT permit for construction in Silverleaves due to flood and erosion risks.
- Nationals MP Melina Bath raised the issue in parliament, questioning why land tax notices were issued at odds with the High Court ruling.
- The Victorian Civil and Administrative Tribunal (VCAT) refused a permit for a home in Silverleaves in 2024 due to inundation risks.
- The Bass Coast Planning Scheme discourages development in Silverleaves due to coastal hazards like erosion and inundation.
Points of Difference
Details reported by only one source:
- Ken Haileyâs land value was initially reduced from $500,000 to $340,000, then further reduced to $85,000 after objections based on the High Court ruling.
- The State Revenue Office (SRO) told Hailey that only residents who objected would receive new valuations, with updates for all residents delayed until the 2027 bill.
- Tristan White, a neighbor of Hailey, objected to his valuation but has not received a response from the SRO.
- Former Law Institute of Victoria president Mark Woods stated the Valuer-General is obligated to consider individual resident objections about valuation factors.
- Anna Lucas, Melbourne Waterâs acting executive general manager, confirmed the flood assessment process for Silverleaves has not changed and follows state guidelines.
- A property valued at $775,000 was reduced to $175,000, cutting the ownerâs annual bill by over $2,000.
- Natalie Gray, a Silverleaves resident, said this was the third year she objected to her valuation, with the first success attributed to clearer guidelines on site assessments.
- The Department of Transport and Planning stated the valuation changes in Silverleaves were not a result of the High Court decision, though they did not confirm proactive reviews for other overvalued properties.
- Tax lawyer Thomas Abraham noted land tax bills have tripled since the Valuer-General became the sole authority in 2023, urging residents to object if valuations seem incorrect.
- Over 200,000 properties in Melbourne Waterâs region have at least a 1% chance of flooding, with 174,000 properties estimated to be exposed to coastal inundation by 2040 per University of Melbourne modelling.
Contradictions
Conflicting information between sources:
- ABC states the High Court ruling in late 2025 directly influenced the valuation reductions, while The Age claims the Department of Transport and Planning denied the changes were a result of the High Court decision.
- ABC reports the SRO told residents new valuations would apply to all in 2027, while The Age does not mention this timeline explicitly and focuses on the need for a statewide review.
- The Age cites a 2024 Environment Department report on shoreline recession (77m since 1953), but ABC only references recession since 2022 (16m) without the 1953 baseline.
- ABC emphasizes the SROâs lack of response to inquiries, while The Age includes a Department of Transport and Planning spokespersonâs comment denying the High Courtâs role in valuation changes.
Source Articles
Residents fight land valuations they say government knows are incorrect
Residents on Phillip Island, where building is limited because of inundation and erosion risk, are battling to have their property valuations reduced.
The sea is coming for this coastal town, but the land tax kept rising
A Phillip Island community whose land is being reclaimed by the ocean a rate of six metres a year has successfully fought unfair land tax bills.