City of Melbourne, City of Yarra and City of Stonnington - all municipalities affected by the proposal – have firmly opposed the levy, citing serious concerns for their residents and business owners.
Property Council Victorian Executive Director Cath Evans said that the increase would have terrible impacts for communities in inner city Melbourne.
"Local councils have an essential role in providing local services, from running essential healthcare, to hosting libraries and multicultural events.
"This levy is placing a significant additional charge on council carparks, while not offering them any additional revenue. The flow-on impacts of this will be severe, with councils being forced to cut funding where it is needed most.
"We are also deeply concerned about driver wellbeing, with many people, such as shift workers and women, choosing to drive for safety reasons.
"New research from Monash University shows women frequently adopt precautionary measures to feel safer on public transport, particularly when they've previously been confronted with intimidating behaviour.
"For individual drivers, this is a yearly cost increase of $1,386 on top of current car parking costs, and we fear vulnerable drivers may feel forced to use public transport due to the price hike.
"This levy is putting these drivers at risk, especially during a period of increased concerns on crime."
The Victorian Government has attempted to justify the increase and expansion of the levy by referencing an outdated March 2020 Infrastructure Victoria report.
Ms Evans said it irresponsible to rely upon 2018 modelling to justify a 2026 tax increase.
"Parking volumes are down 12.3 per cent across 16 key Melbourne CBD sites since 2019, with less people driving into the city during peak critical periods.
"We call on the government to provide new post-pandemic modelling to justify the levy's increase and expansion, considering the collapse in parking volumes and spike in city office vacancy," Ms Evans said.
"If the government was serious about reducing congestion, it would be directing its revenue to local governments to support the establishment of genuine transport alternatives.
"Instead, the government's levy revenue has increased by 1162 per cent from 19.1 million in 2005-06 to a projected $222 million in 2025-26, whilst councils and communities suffer without any funding support.
"It is clear this policy is merely a revenue raising initiative," she said.
The Property Council has written to upper house MPs urging them to vote against the State Taxation Further Amendment Bill 2025 or strip out the levy increase from the Bill.
Lines attributable to City of Melbourne Lord Mayor, Nicholas Reece:
City of Melbourne Lord Mayor Nick Reece told a Council meeting recently:
"Measures that increase the cost of city access – particularly for workers, traders, and visitors – risk undermining Melbourne's recovery during a critical time."
"This is the wrong time for a tax increase on Melbourne. This is the wrong time for a new tax on the inner city."
"It is unfair that shopping precincts in the inner city will face this tax when suburban shopping centres will not."
Lines attributable to City of Stonnington Mayor, Melina Sehr:
"This levy will rip more than $4 million out of Stonnington in its first year alone, directly affecting the services and facilities our community relies on."
"Shoppers, traders and key workers in Prahran and South Yarra will pay the price for a tax that does nothing to reduce congestion or improve public transport."
"We are urging the Parliament to rethink this unfair policy before it causes real and lasting harm to the vibrancy and economic health of our local precincts."
Lines attributable to City of Yarra Mayor, Stephen Jolly:
"The congestion tax is a cash grab masquerading as an environmental initiative.
"It'll lead to massive tax hikes for businesses and car park users in the inner city.
"This will impede the economic activity. It's false economy."
