Finian McGrath (Dublin North Central, Independent)
Link to this: Individually | In context

Question 93: To ask the Minister for Finance if he will support a matter (details supplied). [23780/10]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
Link to this: Individually | In context

The Valuation Act 2001, provides for the valuation of all commercial and industrial property and the Commissioner of Valuation is independent in the performance of his functions under the Act.

The recent revaluation of the Fingal County Council rating authority area was undertaken after the required consultation by the Commissioner with both the Minister for the Environment, Heritage and Local Government and Fingal County Council itself and the subsequent making by the Commissioner of the requisite Valuation Order in March 2007. The new valuation list was published on 31st December 2009. By reference to this list, over two-thirds of ratepayers in Fingal will experience decreased rates liability, no change in their liability or will be newly rated this year, while only one-third face increased rates liability.

As provided in the Act, and as advised to all ratepayers in the Fingal area, there is provision for any ratepayer to formally appeal to the Commissioner of Valuation against the rateable valuation accorded his / her property in the valuation list published on 31st December, 2009. These appeals are now being considered by the Commissioner. If any ratepayer is still dissatisfied with their valuation they can appeal to the independent Valuation Tribunal and ultimately to the Courts on a point of law.

The purpose of a revaluation is not to increase the total amount of commercial rates collected by local authorities. The legislation (Valuation Act 2001 and the Local Government (Business Improvement Districts) Act 2006) provides that the commercial rates income of local authorities in the year following a revaluation will be capped. The only increase in the total rates income of a local authority permitted in the year following publication of the new valuation list is an increase to cover for the rate of inflation. If deflation exists, the overall rates income will be decreased accordingly.

The choice of Valuation Date does not affect the overall commercial rates income of a local authority. The amount of rates payable on any property is the result of multiplying two variables: the Valuation, which is in line with rental values at the Valuation Date and the ARV- the annual rate on valuation, which is calculated by the local authority. Since the total amount of rates to be collected by the local authority is capped in the year after the revaluation takes place, the only movements are between the total amount of valuations and the ARV.

If the valuation date of September 30th 2005 was altered and as a result produced a lower total valuation overall, then the ARV would increase, so that the local authority receives the pre-determined amount of rates income in the year following the Revaluation. Likewise, if a different valuation date produced a higher total valuation overall, then the ARV would reduce to provide the local authority with the same pre-determined amount of rates income. Therefore, changing the date of valuation will not affect the overall amount of rates income received by a local authority in the year following Revaluation.

While individual increases or decreases in rates liability will inevitably be the result of a revaluation, such increases or decreases will reflect movements over time in the overall property market, and result in a fairer, more transparent rating system.