Dáil Éireann Debate, Tuesday - 19 May 2015
466. Deputy Micheál Martin asked the Minister for the Environment, Community and Local Government if he or his departmental officials have discussed increasing business rates; even if this is a sole matter for the councils if he agrees with any increase in the business rates; and if he will make a statement on the matter. [19244/15]
View answer467. Deputy Micheál Martin asked the Minister for the Environment, Community and Local Government if he or his Department have completed a cost-benefit analysis for businesses in the event that business rates are increased; and if he will make a statement on the matter. [19245/15]
View answer468. Deputy Micheál Martin asked the Minister for the Environment, Community and Local Government if he or his officials were consulted regarding increasing business rates; and if he will make a statement on the matter. [19246/15]
View answerI propose to take Questions Nos. 466 to 468, inclusive, together.
Local authorities are under a statutory obligation to levy rates on any property used for commercial purposes in accordance with the details entered in the valuation lists prepared by the independent Commissioner of Valuation under the Valuation Act 2001. The levying and collection of rates are matters for each individual local authority.
The annual rate on valuation (ARV), which is applied to the valuation for each property determined by the Valuation Office to obtain the amount payable in rates, is decided by the elected members of each local authority in the annual budget and its determination is a reserved function.
I am aware of the continued need to restrain the costs on businesses. My Department has in recent years requested local authorities to exercise restraint in setting, and where possible to reduce, ARVs and they have responded positively in this regard. The national average ARV decreased each year from 2010 to 2014; 2015 is not directly comparable due to the local authority mergers and the necessity to harmonise rates across new local authority areas.
Following the reorganisation of local government structures arising from the Local Government Reform Act 2014 there are now just 31 local authorities that adopt an Annual Rate on Valuation (ARV). This is a reduction from the 88 rating authorities which existed prior to the Act.
Because of the wide variances in ARVs within counties, it is not possible to achieve a single ARV per county without some ratepayers benefiting and others losing as a consequence. Moving rates downwards as a general policy would result in a very significant loss of income to the local government sector which would negatively affect the provision of services by local government. The challenge was to identify a solution that balanced these conflicting interests.
The local government reform programme requires authorities to harmonise ARVs across former rating authorities within each of the restructured 31 local authorities within a 10 year period, generally. This will ultimately result in one ARV being in place for each of the 31 authorities. The 10 year timeframe was put in place to ensure that there would be a gradual adjustment to all businesses affected and also to minimise the impact on local authorities' funding levels.
I will continue to keep the approach to rates by local authorities under active review, and am determined that every avenue will be pursued to optimise efficiency and contain costs in the local government sector.
