The recent rates certificates sent by the Valuation Office to local businesses has caused understandable distress and anger. Some businesses have received rateable valuations that will result, in some cases in 11 fold increases in their overall commercial rates ( Valuation Office’s rateable value x The Council’s Annual Rate Value ). That’s an increase of 1100% for some businesses.
The Valuation Office and the Council’s role in Commercial Rates
At last Monday’s Council meeting I was informed that the Rateable Value as set by the Valuation Office has nothing to do with the Council. This is a very insular and short-sighted perspective. The overall income from Commercial Rates (RV x ARV)must remain the same at 58 million euros. It can not do down. If there are less businesses overall to pay rates because they have closed their business because of massive rates increases, then the ARV set by the Council would, in theory, have to go up. This is just one reason the Council should address the Valuation Office’s new valuations. Small to medium enterprises hit hardest by increases in rates deserve our support for a number of reasons.
Why businesses most affected need Kildare County Council support
Over the last number of years small to medium businesses were responsible for creating 3 out of every 5 new jobs . SME’s were key to growing our economy and for dragging us out of the worst of the recession. And just as they are getting up off their knees they are slapped with massive rates increases. Small to medium businesses provide a significant income stream of 58 million euros for the Council. An income that goes towards the provision of services across County Kildare. It is logically and morally imperative that we as a Council help those most threatened by massive rates increases in whatever way we can. And we do have options open to us.
What we can do to help
Firstly, get your appeals in before the 18th April. This is hugely important. The Valuation Office has changed proposed rateable valuations for example where you can provide new evidence around your business’s actual income stream that differs to the Valuation Office’s information regarding income streams for your sector.
Secondly ask your public representatives to lobby the Minister for a change in legislation. At the moment the Council must apply the same ARV to all businesses in Kildare whether a large multinational or a local retailer/hairdresser. So, any small reduction in the Council’s annual rate of valuation intended to help a small business would result in a reduction of millions in Council income from a large multi-national ratepayer. We need new legislation to allow for differentiation between a multinational and a small local business.
Thirdly, in the absence of that legislation, I propose that the Council develop a Rebate Scheme to help those most negatively impacted by the new rates. While we cannot as a Council apply different ARVs to different businesses, there is no legislative obstacle to giving money back to those unfairly impacted by the rates increases, through the mechanism of a rebate scheme. It may be difficult to develop a rebate scheme that ensures that the net result and intended consequence of a fairer distribution of the rates burden while ensuring continued income for local services is achieved. Given the importance of local business to both the local and national economy we must as a Council give it due consideration.
Cllr Fiona McLoughlin Healy