A proposed urban growth boundary extension into rural areas such as Devon Meadows and Clyde and the $95,000-a-hectare GAIC tax on properties sold in the new UGB areas were rejected by the Legislative Council.

Though pleased with the plan's rejection, Taxed Out spokesman Michael Hocking reaffirmed the group's plan to target State Government MPs in marginal seats before this year's election.

The group has argued for the GAIC to be paid by developers and delayed up to 15 years when the areas are at the point of development.

A similar position has been adopted by the Liberals-National Coalition.

The Government has argued the tax is needed to raise about $2billion over 20 years to help pay for infrastructure.

Mr Hocking said there was an expectation the Government could reintroduce the GAIC bill, which was affecting sales of large parcels of land in the areas.

"That means a problem for both those buying and selling land. Sellers don't know if the properties will be taxed and purchasers don't know either.

"Land has been sold at a reduced price on the proviso that the developer will be charged the tax."

Clyde farmer Winsome Anderson, who was facing a $2.5million tax bill if she sold up, said she was pleased to see the defeat of the Government's "unfair" plan. " I think [the Government's] getting the message loud and clear."