Rethink needed on home business commercial rates

Rethink needed on commercial rates for home based businesses

The Westland District Council needs to rethink its proposed commercial rating model for home- based businesses to make it fairer, says the Tourism Industry Association New Zealand (TIA).

TIA has made a submission, commenting on a proposal in the council’s draft Annual Plan 2010/11, to charge commercial rates on home based businesses, such as Bed & Breakfasts (B&Bs).

TIA Chief Executive Tim Cossar says the plan singles out just 90 properties which it believes should pay commercial rates.

“This model of rating misses many other businesses that operate from residential premises but fall below the radar in the council’s targeting process. If the Westland District Council wants to introduce a fair and equitable rating system for home-based businesses, then it should do a lot more work to identify all such businesses operating in the region.”

Mr Cossar says calculating the rate on the capital value of a property also unfairly impacts on bed and breakfast establishments who often only use part of their building as a commercial business, and who often operate on a very seasonal basis.

“The bed and breakfast sector occupies a niche role in the New Zealand tourism sector and unfair rating proposals such as this council is proposing threaten their viability and the personal visitor experience that B&Bs offer.”

Mr Cossar says TIA is not opposed to targeted rates on tourism businesses if they follow good consultation with the local community, and businesses are able to participate in the development of the rating model transparently used to fund tourism activities like i-SITES and Regional Tourism Organisations. He notes that the targeted rating model is working very successfully in other places around New Zealand, including Tauranga, Taupo and Wellington.

The Westland District Council will be considering submissions in a meeting on Thursday 18 March.

Read the submission at www.tianz.org.nz (click on policy).

ENDS