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 Local Government (Rates) Act 1970 provides for the operation of rates waiver schemes. Under the provisions, a rating authority may make and carry out a scheme providing for a waiver of all or a portion of commercial rates due by ratepayers in respect of a specified class or classes of property. The formulation of such a scheme is a matter reserved for the members of the relevant local authority and is subject to my consent as Minister for the Environment, Community and Local Government.
I would consider carefully any application received for a rate waiver scheme. In considering any such application, it has to be borne in mind that a waiver of rates for one class of ratepayer could unfairly impact on other businesses in the area by giving a competitive advantage to a certain group through a reduction in costs. As such, it would be necessary to consider State Aid rules in relation to the provision of any such relief. In addition, the introduction of a waiver scheme could further increase costs on the part of businesses that are not part of the scheme, as it is likely that they would be required to make up the cost of the waiver scheme through the payment of additional rates. This could impose an additional burden on such ratepayers.
Recent developments have seen some local authorities introduce locally designed business incentive schemes which promote the use of vacant commercial property. Such schemes rely upon Part 9 of the Local Government Act 2001 which provides that the functions of local authorities include providing grants, loans guarantees or other financial aid to promote the interests of the local community, including economic interests. Unlike rates waiver schemes, no Ministerial sanction is required for the setting up of these schemes.
I understand that Donegal County Council has already introduced, for 2015, a Small Business Grant Scheme under which businesses can avail of a 5% reduction on their rates bill (subject to a maximum reduction of €250) if their rates are paid in full before the end of the year and there are no arrears on their account.
