17 Nov 2017

The debate over Auckland's rates

From The Panel, 4:20 pm on 17 November 2017
Ratepayers will be uneasy about the council's hefty valuations

Ratepayers will be uneasy about the council's hefty valuations Photo: Pixabay

Jo Holmes from the Auckland Ratepayers Alliance is critical the council is not doing enough belt-tightening and is warning high house valuations could mean rates rises. 

"Because most people's capital value will go up significantly and general rate is based on the capital value - so while in percentage terms the rates increase will be 2 or 3 percent, it will be on much increased capital values, so in dollar terms, people will be paying a very much greater amount than they have in the past," she said.

But Dr Dean Knight, a senior lecturer from the Faculty of Law at Victoria University says that's simply not true.

He says it's nonsense to suggest increases in rating valuations affect a local authority's income.

"As a matter of law, it doesn't. A local authority sets it budget/costs, and the rating valuations only influence how the rates take is distributed across the district," he said.

"An individual rates bill only goes up if a property's valuation goes up by more than the average - and down if it doesn't. To avoid any doubt, a local authority receives no windfall if rating valuations go up."

* Auckland Council wishes to clarify that increases in the capital value of individual properties do not entail a proportional rise in rates

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