The Valuation Act 2001 provides for the exemption from rates of land that is developed for sport such as playing pitches, land on golf courses, tennis courts, etc. In relation to the valuation of buildings occupied by a club affiliated to a sporting organisation, the position is that the 2001 Act also provides for the exemption from rates of "Community Halls". To be classified as a Community Hall, the premises needs to be used for purposes which are not for profit or gain and involve participation by inhabitants of the locality generally and are used for purposes which are of a recreational or otherwise of a social nature. Many sports clubs/organisations achieve exemption from rates of their property under this provision.
However, the Valuation Act, 2001 specifically excludes from this provision, the premises of a club registered under the Registration of Clubs (Ireland) Act, 1904. Therefore, the premises of such a registered club are rateable, which essentially means that clubs that sell alcohol are rateable. This provision currently has the effect of making the entire premises occupied by the club rateable and not just that part of the premises normally used for the sale of alcohol. This is because the sale of alcohol is a commercial activity and a registered sports club is competing with other commercial licensed premises, all of which are rateable.
The Government recently announced that we will be proposing an amendment to the Valuation (Amendment) (No. 2) Bill 2012 which is currently progressing through the Seanad that will ease the rates burden for many local sports clubs. The proposed amendment would mean that Community Sports Clubs will only be liable for rates on buildings that are used for the generation of income. Buildings that are used for the sale of alcohol or food, retail outlets etc. will be rated but buildings that are used for community sport will be exempt.
In proposing this amendment, we are conscious of situations where local sports clubs can be in competition with commercial operators. For that reason it is not just the bar area of a sports club that will be valued for rates but any building that is used in the generation of income.
The Bill is scheduled for report stage in the Seanad on 20th November. If and when the legislation is passed, the Valuation Office will issue revised valuations for sports clubs affected by the new provisions to all rating authorities.