Terence Flanagan (Dublin North East, Renua Ireland)
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428. To ask the Minister for Environment, Community and Local Government his views on correspondence (details supplied) regarding business rates; and if he will make a statement on the matter. [35476/15]

Alan Kelly (Tipperary North, Labour)
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Local authorities are under a statutory obligation to levy rates on any property used for commercial purposes in accordance with the details entered in the valuation lists prepared by the independent Commissioner of Valuation under the Valuation Act 2001. The levying and collection of rates are matters for each individual local authority.  The annual rate on valuation (ARV), which is applied to the valuation for each property determined by the Valuation Office, to obtain the amount payable in rates, is decided by the elected members of each local authority in the annual budget and its determination is a reserved function. Rates income is a very important contribution to the cost of services provided by local authorities such as roads, public lighting, development control, parks and open spaces. Locally elected members adopt the annual rate on valuation they consider necessary in order to provide the required services. I am aware of the continued need to restrain the costs for businesses. My Department has in recent years requested local authorities to exercise restraint in setting, and where possible to reduce, ARVs and they have responded positively in this regard. The national average ARV decreased each year from 2010 to 2014; 2015 is not directly comparable due to the local authority mergers and the necessity to harmonise rates across new local authority areas.

The local government reform programme requires authorities to harmonise ARVs across former rating authorities within each of the restructured 31 local authorities within a 10 year period, generally. This will ultimately result in one ARV being in place for each of the 31 authorities. The 10 year timeframe was put in place to ensure that there would be a gradual adjustment to all businesses affected and also to minimise the impact on local authorities’ funding levels.

I will continue to keep the approach to rates by local authorities under active review, and am determined that every avenue will be pursued to optimise efficiency and contain costs in the local government sector.