Millage Rate in Australia: What Homeowners Need to Know for 2026

The millage rate, sometimes referred to as the 'rate in the dollar' in Australia, is a figure set by your local council to determine how much you pay in property taxes (council rates). Although 'millage' is more commonly used in the United States, some Australian councils now use the term to clarify how rates are calculated.

In essence, the millage rate is the amount charged per $1,000 of your property's assessed value. For example, a millage rate of 2 means you pay $2 for every $1,000 of your property's value. Councils review and set their millage rates each year, balancing the need to fund services like waste collection, road maintenance, and community facilities with the desire to keep rates affordable for residents.

Key Components

• Assessed Value: The value of your property as determined by your state or territory's valuer-general, typically updated every one to three years.
• Millage Rate: The annual rate set by your local council, expressed as a dollar amount per $1,000 of assessed value.
• Property Tax Bill: Calculated by multiplying your property's assessed value by the millage rate, then dividing by 1,000.

Your annual council rates are determined by both your property's assessed value and the millage rate set by your council. Even small changes in either can have a noticeable impact on your bill.

Example Calculation:

Suppose your home is valued at $800,000 and your council sets a millage rate of 1.5. Your annual council rates would be:

$800,000 ÷ 1,000 × 1.5 = $1,200

This means:

• If your property's assessed value increases, your rates may rise even if the millage rate stays the same.
• If the millage rate increases, your rates will go up regardless of whether your property value changes.

Councils may adjust the millage rate in response to rising costs, changes in property values, or new funding needs. In some cases, councils have lowered the millage rate to offset rising property values, while in others, they have increased it to cover additional expenses.

Several trends and policy reviews are shaping how millage rates may be set and communicated in 2026:

Rate Capping Reviews

Some states, such as New South Wales, have mechanisms that limit how much councils can increase rates each year. These caps are under review, and any changes could affect how much councils are able to raise through millage rates. If caps are relaxed, some councils may increase rates to meet rising costs.

Funding for Climate Resilience and Infrastructure

Councils in various regions are considering targeted rate increases to fund projects related to climate adaptation, such as flood mitigation or bushfire preparedness. These may appear as special rates or environmental levies, which can be calculated using the millage rate method.

Greater Transparency

From July 2026, councils are expected to provide clearer breakdowns of how rates are calculated and how funds are allocated. This should make it easier for homeowners to understand their rates notice and compare charges across different local government areas (LGAs).

Local Government Reforms

Ongoing reforms in some states may lead to changes in how property values are assessed or how rates are structured. Homeowners should stay informed about local consultations and announcements, as these can affect future millage rates and rate structures.

While you cannot directly control the millage rate, there are steps you can take to manage your property tax bill and stay informed about changes:

1. Review Your Property’s Assessed Value

If you believe your property has been overvalued, you can appeal the assessment through your state or territory’s formal objection process. A successful appeal can reduce your rates, regardless of the millage rate.

2. Check for Exemptions and Concessions

Many councils offer concessions or rebates for eligible homeowners, such as pensioners or those experiencing financial hardship. These can reduce your rates bill even if the millage rate increases.

3. Participate in Council Consultations

Councils often seek public feedback before setting rates for the year. Engaging in these consultations gives you a voice in how rates are set and how funds are allocated.

4. Compare Rates Across LGAs

If you are considering buying property, check the current and projected millage rates in different council areas. Two similar properties in neighbouring LGAs can have very different rates bills due to differences in millage rates and minimum charges.

5. Budget for Rate Changes

With property values and council budgets under pressure, it is wise to allow for possible increases in your annual rates when planning your household budget.

What is the difference between the millage rate and the rate in the dollar?

In Australia, 'rate in the dollar' is the traditional term for the amount charged per $1 of assessed property value. The millage rate is a similar concept, but calculated per $1,000 of value. Both are used to determine your council rates.

Can I appeal my council rates if I think they are too high?

You can appeal your property’s assessed value, which is a key factor in your rates calculation. Each state and territory has a process for lodging an objection if you believe your valuation is incorrect.

Are there concessions available to reduce my rates?

Yes, many councils offer concessions or rebates for eligible groups, such as pensioners or people experiencing hardship. Check with your local council to see what is available in your area.

Will millage rates increase in 2026?

It is possible that some councils will adjust millage rates in response to rising costs or new funding needs. The exact changes will depend on local circumstances and council decisions.

Understanding the millage rate and how it affects your council rates is essential for every Australian homeowner. With changes expected in 2026, staying informed and reviewing your property’s assessment can help you manage your household budget and ensure you are paying a fair share for local services. For more on protecting your property, see our guide to home insurance.