The Federal Court has ruled that survivors of the 2009 bush fire disaster in Victoria will be charged tax on interest accrued on their record payouts.

The court decided after lawyers for survivors and victims of the Murrindindi Marysville Fire sought advice on whether to challenge the Australian Taxation Office (ATO) decision to tax the interest on the AU$300 Million settlement.  But the decision could have implications for the almost AU$500 Million settlement that was approved in December 2014 for the Kilmore East-Kinglake fire victims.

The tax liability has been reported as being as high as $20 Million.  The law firm Maurice Blackburn racked up tens of millions of dollars' worth of fees for negotiating with the ATO on behalf of survivors who had previously sued electricity provider SP AusNet, Utility Services Corporation Limited, and the Department of Sustainability and Environment.

The Black Saturday Fires in Victoria killed some 180 people on a blazing hot 46 C degree weekend in February 2009, after a fire in Bunyip State Park jumped containment lines.