Bass Coast Shire defends short-stay fee hike as providers cry 'extortionate'

Annual registration fee for holiday rentals rises from $324 to $600, sparking backlash and accusations of double-dipping with new state levy

By LineZotpaper
Published
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Bass Coast Shire Council in coastal Victoria has doubled its annual registration fee for short-stay rental providers to $600, prompting an outcry from homeowners who accuse the council of double-dipping alongside a new statewide levy on holiday lets.

The council, which covers holiday hotspots including Phillip Island, raised the fee earlier this year from $324 to $600, or $900 for properties with more than five bedrooms. Lisa, a Phillip Island holiday home owner who did not want her surname published, said she was caught off guard. "It seems a bit extortionate really," she said. She and her partner bought the home two years ago and rent it at about $220 per night on an online platform, hoping to share it until they move there permanently.

The council defends the increase as necessary to cope with additional costs created by the holiday accommodation industry. But tourism advocates warn that higher fees may deter owners from renting at all, leaving more homes empty for longer. The fee hike comes on top of a statewide levy of 7.5 per cent on short-stay bookings that came into effect in Victoria in 2025. While some councils like Warrnambool scrapped local fees after the levy was introduced, Bass Coast retained its registration process, which it has had since 2023, and now has the highest local fees in the state.

Some short-stay providers accuse governments of double-dipping. University of Sydney housing expert Nicole Gurran said the state booking levy was likely being paid partly by consumers. "It may be a bit of both: a bit of a provider absorbing the cost and a bit of them adding them on to the fee paid by the customer," she said.

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Analysis

Why This Matters

  • Homeowners in holiday hotspots like Phillip Island face rising costs that could reduce the supply of short-term rentals, potentially affecting tourism.
  • The fee dispute highlights tensions between local council regulations and state-level taxes on the short-stay sector.
  • Outcomes may influence whether other councils follow Bass Coast's lead or scrap local fees.

Background

Bass Coast Shire is one of a handful of Victorian councils with local laws regulating short-stay accommodation. It introduced a registration process in 2023. In 2025, the Victorian government imposed a statewide 7.5 per cent levy on short-stay bookings. While some councils, such as Warrnambool, dropped their own fees after the levy arrived, Bass Coast kept its system and increased the fees, making them the highest in the state.

Key Perspectives

Short-stay providers: Homeowners like Lisa say the fee hike feels extortionate and may discourage them from renting out their properties, potentially leaving holiday homes empty. Bass Coast Shire Council: The council argues the higher fees are needed to cover additional costs generated by the short-stay industry, such as regulatory oversight and community impacts. Tourism advocates: They warn that deterring owners could reduce the number of available holiday rentals, hurting local tourism. Housing expert Nicole Gurran: She notes that the state levy is likely passed on to guests in part, suggesting the burden may not fall entirely on providers.

What to Watch

  • Whether Bass Coast sees a drop in registered short-stay properties following the fee increase.
  • How other Victorian councils decide on local fees: will they follow Warrnambool or stick with Bass Coast's approach?
  • Possible petition or legal challenge if community opposition continues to grow.

Sources

Zotpaper

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