Tuesday, May 10, 2011

Revaluation of Dublin city businesses could lower rates - The Irish Times - Mon, May 09, 2011


THE COMMERCIAL value of every business paying rates in Dublin city is to be recalculated for the first time in 100 years by the Valuation Office.

The process of assessing how much each of the 25,000 businesses in the capital should pay in rates to Dublin City Council will begin immediately, the office said, with the issuing of valuation forms in the coming days, and will not be completed until 2013.

The recalculation will be based on the value of properties and businesses on April 7th, 2011, and will mean some firms will pay lower rates than in previous years.

The rates paid to local authorities by businesses are based on the assessments made by the Valuation Office of the worth of each commercial property in the State. These figures are then multiplied by a rate set by each of the 88 local authorities each year in their annual budgets, and a bill is then sent to each business.

In relation to shops, offices and industrial premises, the valuation is based on an estimated rental value for the property, while for hotels the valuation is based on a receipts and expenditure calculation.

The revaluation process is “revenue neutral”, meaning that the recalculation of the value of a premises will not bring in any extra fees for the city council.

Rather it will result in a fairer distribution of the burden of rates, which inevitably means there will be winners and losers, according to a spokesman for the Valuation Office.

“Even though property values have fallen generally, not everyone will gain from the revaluation – there will be winners and losers. It depends on how the rental value of each property changes relative to other property values.”

Irish Hotels Federation president Paul Gallagher said he would expect his members to be “winners” following the Dublin city revaluation, given the deterioration in the profitability of the sector.

“Hotels and guesthouses subsidise other commercial ratepayers. It’s been proven that the hotel sector has been bearing far too great a burden of rates.”

Revaluations which had already taken place in other Dublin local authority areas had resulted in rates for hotels being revised downwards by at least 30 per cent, Mr Gallagher added.

While the Dublin revaluation was welcome, the slow pace of progress would result in many hoteliers being put out of business by exorbitant rates before their local authority area was reassessed, he said.

“It’s 10 years since the Valuation Act was introduced. There is a complete lack of urgency about this process and no timetable for reviewing local authority areas outside Dublin.”

In addition to the unfair rates burden hotels were bearing, hoteliers felt they were getting little in return from local authorities for their money.

“My members are looking outside their front doors to see roads full of holes and lanes full of rubbish and they’re thinking: ‘What am I paying rates for?’ ”

The completion of the Dublin city revaluation would mean 60 per cent of businesses in the State were revalued, the Valuation Office spokesman said. The programme would then be rolled out to other local authority areas.

We need this all over the country...now!

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