Supporting economic development and enterprise objectives in their own areas, and on a regional and national basis, is a core objective of local authorities. Commercial rates income is critical to meet the cost of services provided by local authorities in supporting local communities and businesses.
The Commissioner of Valuation is independent in setting of valuations for rating and the Valuation Office is currently engaged in a national revaluation programme, the first such revaluation in over 160 years. Up to date valuations are important to ensure that the levying of rates is on a fair, equitable and consistent basis across all economic sectors and parts of the country.
Local authorities levy rates on commercial properties in accordance with the Commissioner’s valuation. The annual rate on valuation (ARV) is a reserved function decided by elected members in the annual budget. My Department has, in recent years, requested local authorities to exercise restraint in setting ARVs and they have responded positively.
In overall terms, while economic activity has been expanding significantly in recent years, the overall rates income of local authorities nationally has remained relatively unchanged. Furthermore, I understand that of the revaluations conducted to date, under the revaluation programme, approximately 60% of ratepayers have had their liability for rates reduced and approximately 40% have experienced an increase.
In order to ensure that the revaluation promotes equity across sectors and areas, but is also a revenue neutral exercise in overall terms, the Minister may limit the total amount of rates collectable within a local authority in the year following a revaluation to that collected in the previous year, subject to minor adjustments.
In terms of specific reliefs, the Local Government (Rates) Act 1970 allows rating authorities to make waiver schemes in respect of specified classes of property, subject to the consent of the Minister. Furthermore, the Local Government (Rates) Bill 2018, which passed Committee stage in the Dáil last week, contains a provision, for the introduction of rates alleviation (waiver) schemes by local authorities to support important policy objectives contained in local, economic, community and land use plans. The Bill is a key legislative priority of my Department.