AMENDMENTS to the controversial land tax for growth areas are likely to be passed in the Upper House later this month.

The changes to the Growth Areas Infrastructure Tax (GAIC), in which only landowners in the proposed urban growth zone with more than 10 hectares would be subject to the tax, were passed in the Lower House last week. Debate was adjourned in the Upper House and will resume on 25 May.

The Opposition has claimed it a victory for small landowners, because the majority have less than 10 ha, but lobby group Taxed Out believes making anyone with more land liable for the full tax was unfair.

Taxed Out chairman Michael Hocking said slapping a tax on any property larger than 10ha would skew the market.

“People are going to be severely punished for owning just one more square metre (than 10 ha),” he said.

“It will be an up-front liability of $285,000 on the sale of property yet someone with 9.9 ha pays nothing.

“There have been mild improvements because we have fought all the way to do that.”

Under the new scheme, developers will pay 30 per cent of the GAIC up front - $28,500 per hectare – when they purchase land, and the remaining $66,500 per hectare when they subdivide.

Purchasers would not have to pay the remaining 70 per cent if they on-sell the land before subdividing.

Shadow Planning Minister Matthew Guy said the amendments were a “win to landowners”.

“This represents a rise in the GAIC-free threshold of five times above what the government most recently proposed, and will exempt the vast majority of residential landholders within the urban growth zone from paying any GAIC,” he said.

Mr Hocking said residential landowners in the growth boundary with more than 10ha could face financial hardship.