NEW VALUATIONS

Evening Post, Volume CVIII, Issue 24, 27 July 1929, Page 10

NEW VALUATIONS

EFFECT ON RATES

CIVIC LEAGUE INQUIRY

MARKED ANOMALIES

An interesting report upon the effect of the new valuations upon rating in the citywas submitted to members of the Civic League by the secretary, Mr. D. M'Laren, this week. The report maintained that Ihc present incidence o£ rating does not appear to be based on sound principles of equity, »nd that under the Jast valuation it is the small man who is hardest hit by rate increases. . ■ The report is as follows:— ■' "The Mayor iv his statement to the council alter presenting the year's estimates, proposed that the rate in the £ - oflA 0! 11 h% reduced from * T5.40d to 1 24.40 d. Generally, he sain that where the valuation had been inec-osed by 50 per cent, the rates increase *» jaifl be approximately 14 per cent. This may mean that the average increase in rates is about 14 per cent. Such,. however, is not the information which the individual ratepayers seek as their rates are fixed not on the general average of values, but the increase or decrease in valuation of their own property. "Instead of having to face an increase of only 14 per cent, in rates it is the case that many will have to meet a much, greater increase. On a careful examination, in which I had the valuable assistance of our president, I find the following, to be the position: At an increase of 32 per cent, in value, on the laud, the rates will equal those of last year. All under 32 per cent, gives » decrease in rates. At 50 per cent, there is an increase of 14 per cent, in rates. Those valuations showing over 50 per cent, increase mean an increase in rates of the 14 per cent, average, plus a proportion o£ the loss from the reductions, rising in graduation of the increased percentage in values. . . Properties increased in value 100 percent, will not be rated at twice 14 per cent, increase, but nearer 50 per cent. For example, increased valaution £400 to £600—50 per cent.—rate increase £1 14s, which is approximately 14 per cent, increase. Valuation £400 to £800—100 per cent.—rate increase £6 7s, which is 50 per cent, increase. "His Worship the Mayor supplied a table of rates and values for comparison, of this year's incidence with that of last year. He also set out typical instances of increases taken from this table. All of the instances he cites show increase of rates on the increase of the land valuation given. An examination of the same table will also disclose the fact that land which has considerably increased in value is in many instances marked down for a decrease in rates. It is not correct to assume that the rates on a holding are increased in proportion to the amount added by the fresh valuation. INCREASES AND DECREASES. "Here are four instances of increase in valuation of £200 each with the result m rate figures: £200 to £400, rate increase, £2 3s Sd; £400 to £600, rate increase, £1 14s; £600 to £800, rate increase, 4s 4d; £800 to £1000, rate increase, £1 5s 4d. "From the very table which Mr. Troup submitted, I have drawn up another ■which presents decrease of rates (in each case), concurrent with increase in values of the properties: £400 to £450, £1 16s; £450 to £500, £2 3s sd; £500 to £600, £1 7s 6d; £600 to £700, £2 2s 4d; £700 to £750, £4 0s 6d; £750 to £800, £2 17s 2d; £800 to £1000, £1 5s 4d; £1000 to £1050,- £G ss; £4000 to £4500, £18; £5000 to £6000, £13 15s; ■ £6000 to £7000, £21 3s 4d; £7000 to £SOOO, £28 11s 8d; £8000 to £9000, £36; £9000 to £10,000, £43 Ss 4d. From these facts and figures it is made clear that the variation in Tates claimed is not proportioned to actual increase in value of the holding as presented iv the revaluation, but is based on the percentage of difference between the old and the new valuation. "Thus £100 increase of valuation from £2000 to £3000 because it.is aSO per cent, increase, means £8 10s more in rates whilst an increase of £1000 in the valuation from £6000 to £7000, being 15% per cent, increase, gives a decrease of £21 3s 4d in the rates. GENERAL AND TOTAL RATES. "On examining the matter of the total revenue drawn from rates I find that last year it wa5*£434,135. This year £500,11(5 is called for. The council has increased the total rate demand by £06,175. It would have been of more interest to the ratepayers if the Mayor and' councillors had at the time of adopting the rates for the year specifically stated the amount-of extra revenue required, the purposes it was needed for, and the reasons in each, instance for increase this year as compared with last year.' Talk about the average increase in rates, or reference to the general rale and not the total rates, which has been frequently indulged in, is of no value. The real issue affecting the ratepayers in general is what revenue from rates the council demands and why.

"Over a term of years many iind their rates going up year after year and where they desire to retain their holdings as a home, not to speculate, it is no. consolation to tell them that the average increase in rates is not excessive when they know that they have to pay 50.60 or 100 per cent, more in rates than was the case a comparatively few years ago.

"The present incidence of rating does not appear to me to be based on sound principles of equity. Under the last valuations the pressure is greater oa those of lesser means as judged by the tables supplied. The view taken by the league that the whole matter of the systems of valuing and rating should be made subject to review seems to me to be strengthened by what has taken place in Wellington this year."