Victorian State Budget 2026–27

What It Means for North‑East Victoria Businesses and Investors

On 5 May 2026, Victorian Treasurer Jaclyn Symes delivered the 2026–27 State Budget, positioning it as a “disciplined” election‑year budget that returns the state to surplus while maintaining strong support for households, regions and essential services. For businesses and investors in regional centers like Wodonga and Wangaratta, the budget reinforces long‑term regional growth but also confirms that property‑based and payroll taxes remain central to Victoria’s revenue strategy.

Big Picture: A Cautious Budget with Mixed Results

The government forecasts a roughly $700 million operating surplus in 2025–26, increasing to $1.0 billion operating surplus in 2026–27, with infrastructure investment dropping from around $21.4 billion in 2025-26 to $19.4 billion in 2026-27 and net debt climbing to $175.6 billion on its way to nearly $200 billion by 2030.

While spending growth is modest and state debt remains problematic, regional Victoria remains a clear beneficiary, with funding targeting healthcare, skills development, transport connectivity and agricultural supports. This is reflected in the $23 million for the Future Regions initiative to boost productivity, liveability and investment in regional Victoria among many other investments.

Despite returning to surplus, the Budget offers little relief for small businesses as payroll tax continues to grow steadily, expected to generate approximately $12.5 billion in 2026-27 adding pressure for employers.

Highlights for Wodonga, Wangaratta and the Regions

Skills, TAFE and Workforce Supply

Skills shortages remain a key constraint in the region. The Budget attempts to address this with various investments including:

• $5 million for hydrogen and battery‑electric vehicle training at Wodonga TAFE, supporting advanced manufacturing, transport and clean‑energy supply chains.

• Continued funding for Free TAFE and apprenticeships, which underpin workforce availability for construction, healthcare, logistics and agriculture across North‑East Victoria.

Regional Transport & Connectivity

Efficient freight and mobility remain critical for regional competitiveness, some large expenditures in the Budget include:

• $127 million to improve regional freight rail infrastructure across Victoria to support the efficient movement of goods and fewer trucks on regional roads.
• $560 million in additional funding for road maintenance, bringing this year’s total to a record $1 billion.

Regional Development & Agriculture

For agribusinesses and land‑dependent enterprises:

• $84 million to support Victorian farmers and agricultural industries, including bushfire recovery support, productivity, resilience and workforce initiatives.
• $5.9 million for farmer health, safety and wellbeing programs
• $5 million to improve energy efficiency on farms
• $7.6 million for biosecurity initiatives.

• Continued investment in regional economic diversification programs aimed at strengthening local supply chains and value‑adding industries.

What the Budget Signals for Property and Land Investors

Property Taxes Remain a Structural Headwind

In bad news for property owners or investors, Victoria remains heavily reliant on land tax, stamp duty, vacant residential land tax and windfall gains tax, combined forecast to raise $17.6 billion in 2026–27.

Housing Supply and Regional Property Outlook

The state investments in housing are aimed primarily at social and affordable housing. The government’s focus is fixed on home owner-occupiers rather than encouraging additional private investor ownership for the rental market.

However, regional growth funding, transport upgrades and skills investment are expected to help contribute to supply of housing in the long term, especially where population and employment grow.

Bottom Line: Quick Summary

For Businesses

• Strong continuity in regional business support, skills and infrastructure investments.

• No new business taxes, but payroll tax is projected to grow with no major cost‑of‑doing‑business relief.
• Government is relying on broad investments in regions to drive growth and improve economic conditions for business indirectly.

For Investors

• Tax settings continue to weigh on net returns, particularly for land‑heavy investing strategies.

• Properties in well‑located regional commercial and residential areas may gain advantages from additional investments in infrastructure and jobs growth.
• Housing focus continues to be on affordability and driving prices down, making it a tougher market for investors that bought in on high property prices.

While this budget struggles to deliver much for businesses and investors, Johnsons MME continues to be there for our clients and community. Make sure you reach out to your trusted advisor for anything we can do to help you in these tough economic times.

FAQs about Victorian State Budget 2026 and regional business

What does the Victorian State Budget 2026 mean for regional businesses?

The Victorian State Budget 2026 includes funding for regional infrastructure, skills training, freight rail, agriculture and road maintenance. While there are no major new business taxes, payroll tax and other state taxes remain a significant cost for many employers across regional Victoria.

Will payroll tax increase in Victoria after the 2026 State Budget?

The 2026 Victorian State Budget did not introduce major payroll tax relief for businesses. Payroll tax revenue is forecast to continue increasing, meaning many Victorian employers will still face growing employment related costs over coming years.

How could the Victorian State Budget affect regional property investors?

Regional property investors may benefit from long term infrastructure and employment growth in areas such as Wodonga and Wangaratta. However, land tax, stamp duty and other property related taxes continue to impact overall investment returns in Victoria.