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Mayor Clarifies Business Rates Confusion

North Shore Mayor Clarifies Business Rates Confusion

North Shore City Mayor clarifies business rates confusion July 25, 2003

North Shore City Mayor George Wood says claims that his council is anti-business are misplaced and mischievous.

"The facts speak for themselves," says the mayor of the city experiencing the fastest economic growth in the Auckland region.

According to an independent report by Infometrics, North Shore City's economy grew by 4.7 per cent in the year to March 2002 - twice as fast as its population over the same period.

Mayor Wood says North Shore City Council in its 2003-04 Annual Plan reduced the amount of rates paid by the business sector from 28 per cent to 26.5 per cent, following submissions from representatives of the business community.

He wants to set the record straight on how much businesses pay relative to homeowners and how his council applies this rating policy known as a differential.

"Our differential applies to the general (plus MOTAT and Auckland Museum) rate, not to our uniform annual general charges. Taking this into account, the rate that businesses pay compared to residents varies according to land value.

"As an example, for a land value of $100,000 a business is paying 2.35 times the residential rate and it increases gradually on a scale that ranges from 3.96 (times) for $300,000 of land value to 6.09 (times) for land values of $1 million," says Mayor Wood.

North Shore City Council has been through a comprehensive process to establish the benefits to, and costs generated by, the business and residential sectors.

George Wood says this process established that the amount the council charges businesses is reasonable and the fact that North Shore City has this year (2003/04) reduced this amount from 28 per cent to 26.5 per cent shows it is being business friendly.

"In fact, after GST is claimed back and taxation is taken into account, the net cost to a business owner with a land value of $100,000 reduces from the gross amount of $2775 to $1652 a year. This is 1.4 times the amount a resident with a $100,000 land value property pays.

"When the true picture is revealed and the benefits analysed, we feel we're being fair to businesses and residents alike," he says.

"North Shore City's business rates compare favourably to others around the place and this is reflected in the economic growth and positive attitudes which lead the region.

"We've been helping local firms for over a decade through Enterprise North Shore, our city's business development agency," says George Wood.

"We're also currently developing our first economic development strategy in consultation with the local community and we're a partner in a number of regional initiatives such as AREDS and Tourism Auckland.

"We encourage entrepreneurs with high technology and low environmental impact to set up businesses in North Shore City, to create high value and challenging local jobs for residents, now and in the future. "Our council has backed initiatives such as the e-centre at Albany's Massey University to help grow local businesses and the city's economy by reversing the brain drain and protecting the talent within our shores," says George Wood.

(ends)

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