Auckland ratepayers will really suffer

Press Release – No More Rates

Media release 15th February 2012 Auckland ratepayers will really suffer when new rates bills go out. Council’s plan to ‘cushion effects’ of switching to capital value rating will be unaffordable to tens of thousands of ratepayers Cost of switching …NoMoreRates.com

Media release 15th February 2012
Auckland ratepayers will really suffer when new rates bills go out.
Council’s plan to ‘cushion effects’ of switching to capital value rating will be unaffordable to tens of thousands of ratepayers
Cost of switching should be spread over 10 years.

The Council’s Strategy & Finance Committee todays endorsed the Mayor’s plan to spread the effect of huge swings in the liability for rates following the switch to Capital Value as the basis for rating from 1st July.

Figures revealed today showed that 63% of residential and rural ratepayers will have rates increases of up to 10% in the coming financial year – that percentage rises to 78% of residential ratepayers in Year 2, and almost 90% in the third year.

That level of increase will be unaffordable for many fixed and low-income households.

The Council’s proposals would see rates increases ‘capped’ at 10%, while rates decreases which would otherwise have gone to lower-value homes will be limited to a maximum reduction of 5.6% from 1st July. Then further reduce to 3.8% in Year 2 and 3.7% in Year 3.

In effect ratepayers whose rates will be reduced as a result for last year’s revaluation will lose some that reduction to make up the shortfall caused by ratepayers in more valuable properties having their increased rate capped at 10%.

Almost robbing the poor to help the rich.

The mayor himself recognised this when he said he was asking for a ‘generosity of spirit’ from those in lower value homes who would be deferring part for their currently legal entitlement to receive the full rates reduction arising from their lower valuation.

However, key parts of the Mayor’s plan are not currently legal and will need changes to rating legislation.

I believe the true that the tens of thousands of ratepayers will be faced with 10% increases in each of the next three years – and will not be able to pay, or will be forced to economise on some of the necessities of life.

I believe the Council should spread the impact of the switch to rating on Capital Value over a 10 year period – and ask the Government to introduce legislation to allow this to happen
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