Gordon Campbell | Parliament TV | Parliament Today | News Video | Crime | Employers | Housing | Immigration | Legal | Local Govt. | Maori | Welfare | Unions | Youth | Search

 


Property revaluations for council rates must be reformed

Property revaluations for council rates must be reformed.


Opportunity to bring controls on rating value changes and more equitable level of annual rates increase

Early indications of the latest 3-year revaluation for council rating purposes show that once again there are going to be winners and losers when next year’s rates are set.

Despite loud noises about rates reform from Auckland’s Mayor and other councils, and promises of action from Local Government New Zealand, nothing looks like changing, and the property revaluation exercises every three years only increases the level of unfairness in the current system.

Most councils receive more than 60% of their operating costs from rates and water rates, despite warnings that such a level of rates income will soon make rates unaffordable for many ratepayers.

Reform is needed and soon, and a start should be made on the revaluation system which causes rates to rise disproportionally and affecting ratepayers who have had no or little change in their financial circumstances.

In any reform of local government funding it is inevitable and generally accepted, that some form of property tax will form part of a total funding package.

With that in mind I suggest a change in the valuation process, initially for residential properties.

Call the new system Council Tax Value.

· All residential properties would be given a Council Tax Value [CTV] as at the latest revaluation date.
· Each year all values would be increased by 2% on the previous year’s value.
· Values of individual homes would also be changed when they were sold and the actual sales price would become the new CTV.
· The CTV would also be changed if additions or alterations requiring a building and/or resource consent were carried.
· The change would generally be upward to reflect increase in value from the additions, but would apply if property was subdivided and value reduced as a consequence. In that event the new property created would be given an initial CTV.
· This process would remove the requirement for tri-ennial revaluations, and would avoid the swings in Rating Valuations under the present system which leads to, often significant, changes in rating incidence on individual properties.
· Under the CTV system most residential ratepayers would face percentage rate increases very close to the average.
· This would result in a more stable valuation environment without the three-yearly bout of stress faced by many ratepayers who appear bewildered by the justification for changes to their rates bill.
· It would be imperative under a CTV system that Real Estate Agents were prohibited from using the CTV as a guide to market value. [Real Estate agents amass their own sales statistics for use in marketing and selling.]

Furthermore…

The CTV system also offers an opportunity to set limits to rate rises by setting a percentage of the CTV as the fixed annual increase a council can levy for a specified period.

This is similar to the so-called Proposition 13 arrangement in California.

For example a levy of 0.3% on a property with a CTV of $450,000 would produce $1350. The following year the annual 2% increase on CTV would add $9000 to the value and the tax would increase to $1377.

This type of approach could be used to reduce the reliance of councils on rates and concentrate everyone’s efforts to finding alternative funding sources.

ends

© Scoop Media

 
 
 
 
 
Parliament Headlines | Politics Headlines | Regional Headlines

Gordon Campbell: On Bill English, Abroad

Looks like you need to get the blurb yourself. Probably best to do that irrespective, actually.If David Cameron was the closest thing John Key had to a political mentor, their successors also share a whole lot in common.

Theresa May and Bill English were both propelled into the top jobs as the result of unexpected resignations, and without much in the way of credible competition from their colleagues. Neither have yet been given a mandate to govern by the electorate although – in both countries – the Labour opposition is in less than robust shape. More>>

 

Pike River: Labour Bill To Override Safety Act For Mine Entry

“Bill English has been hiding behind the legal excuse that any attempt to re-enter the mine to recover the bodies might place the mine’s owner, Solid Energy Limited, and its directors in breach of the Health and Safety at Work Act 2015." More>>

ALSO:

Gordon Campbell: On Populism And Labour 2017

For many people on the centre-left, populism is a dirty word, and a shorthand for the politics of bigotry. In this country, it has tended to be equated with the angry legions of New Zealand First. Who knew they were not just a reactionary spasm, but the wave of the future? More>>

Oxfam: 30% Of NZ Owns Less Wealth Than Our Two Richest Men

The research also reveals that the richest one per cent have 20 per cent of the wealth in New Zealand, while 90 per cent of the population owns less than half of the nation’s wealth. The research forms part of a global report released to coincide with this week’s annual meeting of political and business leaders at the World Economic Forum in Davos, Switzerland. More>>

ALSO:

Hospitals: Resident Doctors Set To Strike Again

Despite discussions between the DHBs and NZRDA over safer hours for resident doctors progressing during the last week, the strike planned for next week appears set to proceed. More>>

ALSO:

Not So Super Fund: More Burning Ethical Questions For Steven Joyce

Greens: Radio New Zealand reported this morning that the New Zealand Superfund has $77 million invested in 47 coal companies that the Norwegian Government’s Pension Fund – the largest sovereign fund in the world – has blacklisted. More>>

Activism: Greenpeace Intercepts World’s Biggest Seismic Oil Ship

Greenpeace crew have made contact with the world’s biggest seismic oil ship after travelling 50 nautical miles on two rigid-hulled inflatables off the coast of Wairarapa... Greenpeace radioed the master of the Amazon Warrior to deliver an open letter of protest signed by over 60,000 New Zealanders. More>>

ALSO:

Gordon Campbell: Why Tax Cuts In 2017 Would Be A (Proven) Bad Idea

Ever since the world fell prey to the mullahs of the free market in the 1980s, no amount of real world evidence has managed dispel one key tenet of their economic faith. Namely, the idea that if you cut income taxes and taxes on small business, a wave of individual enterprise and entrepreneurial energy will thus be unleashed, profits will rise and – hey bingo! – the tax cuts will soon be paying for themselves ... More>>

Get More From Scoop

 

LATEST HEADLINES

 
 
 
 
 
More RSS  RSS
 
 
 
Politics
Search Scoop  
 
 
Powered by Vodafone
NZ independent news