Millage Rate in Australia: What Homeowners Need to Know for 2025

For many Australians, property ownership comes with a string of unfamiliar terms—’millage rate’ being one of the most misunderstood. Yet, this seemingly obscure concept directly affects what you pay in council rates and, by extension, your annual cost of homeownership. With property taxes in the spotlight for 2025, understanding the millage rate is more important than ever.

What Is the Millage Rate?

The millage rate (sometimes called the ‘rate in the dollar’ in Australia) is the figure local councils use to calculate property taxes, also known as council rates. While the term ‘millage’ is more common in the US, it’s increasingly popping up in Australian council documents—especially as councils look to clarify how they fund local services.

In simple terms, the millage rate is the amount per $1,000 of your property’s assessed value that you pay in rates. For example, a millage rate of 2 means you pay $2 for every $1,000 of your property’s value. Councils set their own millage rates each year, balancing local needs with budget constraints.

• Assessed value: Determined by your state’s valuer-general, usually every 1–3 years.
• Millage rate: Set annually by your local council.
• Property tax bill: Assessed value × millage rate = amount owed.

How Does the Millage Rate Affect Your Property Tax Bill?

Your total property tax is a product of your property’s assessed value and your local millage rate. Here’s how it plays out in practice:

Example: In 2025, let’s say your home in Brisbane is valued at $800,000. If the council millage rate is 1.5, your annual council rates would be:

$800,000 ÷ 1,000 × 1.5 = $1,200

This means even a minor change in either the assessed value or the millage rate can have a noticeable impact on your bill. In recent years, as property values have surged in parts of Australia, councils have sometimes lowered the millage rate to avoid ratepayer backlash, or kept it steady and increased minimum charges.

• Rising property values can increase your bill even if the millage rate stays the same.
• Council budget needs may force an increase in the millage rate, especially with higher infrastructure or climate resilience costs.
• Policy changes in 2025: Several councils, including those in Sydney and Melbourne, are reviewing millage rates as part of local government reform and climate adaptation funding.

2025 Policy Updates and What to Watch For

This year, several significant shifts are underway:

• Rate capping reviews: NSW’s Independent Pricing and Regulatory Tribunal is reconsidering the cap on rate increases. If caps are loosened, some councils could hike millage rates to cover rising service costs.
• Climate resilience funding: Councils in Queensland and Victoria are factoring climate adaptation into their budgets. Expect targeted millage rate rises in flood-prone or bushfire-affected areas, justified as ‘special rates’ or ‘environmental levies.’
• Transparency push: From July 2025, all councils must publish clear breakdowns of how millage rates are calculated and where your money goes, making it easier to compare rates between LGAs.

For property investors, these changes could affect cash flow and rental yield calculations. For owner-occupiers, they mean higher scrutiny of council budgets and more opportunity to have your say during annual rate consultations.

Smart Strategies for Homeowners

While you can’t control the millage rate, you can take steps to manage your property tax bill:

• Appeal your property’s assessed value if you think it’s too high. All states have a formal objection process, and successful appeals can lower your rates.
• Watch for exemptions or rebates, such as pensioner concessions, which can slash your bill regardless of the millage rate.
• Get involved in council consultations. Public feedback can influence rate-setting and help keep hikes in check.

And if you’re considering buying property in 2025, check the local council’s current and projected millage rates. Two similar homes in neighbouring LGAs can have very different rate bills because of different millage rates—even if the property values are comparable.

Conclusion

The millage rate is a crucial piece of the property tax puzzle that every Australian homeowner should understand. With councils under pressure to fund essential services and climate adaptation, millage rates are likely to become a bigger talking point in 2025. Stay informed, review your assessments, and engage with your local council to make sure you’re not paying more than your fair share.