Watering down a contentious tax on high-fee Victorian private schools has created a $100 million gap in the state budget.
Education Minister Natalie Hutchins has announced 60 independent and religious schools will lose their longstanding payroll tax exemption from July next year.
She was tasked with compiling a so-called hit list of schools, with the consent of Treasurer Tim Pallas, and set the income threshold at more than $15,000 per student.
A full list of the non-exempt schools has been published and includes St Kevin's College in Toorak, Kew's Xavier College and Haileybury College in Keysborough.
The $15,000 threshold will apply until at least the start of 2029, with other non-government schools opening in coming years to also be assessed against it.
More than 660 non-government schools will remain exempt.
Last month's Victorian budget stated about 110 high-fee schools would lose the exemption, raising $422.2 million over the forward estimates to help the state rein in mounting net debt following the COVID-19 pandemic.
Premier Daniel Andrews later clarified the number of affected schools would be fewer than that following backlash from peak bodies for the independent and Catholic sector.
Ms Hutchins denied it was a backdown, declaring the government had listened to the concerns of schools but had to start repaying COVID-related debt.
"This is all about recovery," she told reporters on Thursday.
"It's only fair that a whole range of organisations across the state, including the business sector, including our really high profiting, high fee-paying private schools, are part of that payback plan."
Mr Pallas said the watering down of the tax will mean the state recoups $100 million less than flagged in May's state budget but maintained it was still important.
"There's $322m reasons why we'd want to keep it," he said.
While government schools in Victoria are not exempt from payroll tax, no other state or territory levies payroll tax on non-government schools.
Peak bodies in the sector have claimed extra costs will inevitably be passed in the form of higher student fees amid soaring cost-of-living pressures.
Whether the tax translates to higher student fees will ultimately be a decision for schools, Mr Pallas said.
Paring back the exemption could also leave some non-government schools with payrolls of more than $10m exposed to the incoming COVID-19 debt levy and already implemented mental health levy.
The Victorian opposition has vowed to repeal the tax if elected in 2026 despite the government almost halving the number of impacted schools.
"It will still be regressive, it will still be punitive and it will still be unfair," Opposition Leader John Pesutto said.
"The people who will suffer are the families who make sacrifices to send their kids to independent schools."
