Posts: 56
18 June 2023 at 4:29 pm #397

Council Rates Justifications

    It is ironic that many council members have advocated for preserving infrastructure and avoiding future costs, while also blaming the rising housing prices for the need to increase rates. This argument does not make sense. Why should the value of a house affect the amount of rates paid?

    Let me give you an example. Suppose I own a standard 3-bedroom house on a 650m section, built in 1975, that cost $110,000. If I demolish it and build a new 3-bedroom house worth $750,000, the government valuation (GV) of my property will go up from $210,000 to $850,000. But will my use of services change? No, it will probably be the same or even less, since the new house might have more eco-friendly features. So why should I pay more rates for the same level of service?

    I don’t know the rationale behind using the GV to calculate rates, but it seems unfair and illogical. If the service demand is the same regardless of the house value, why should the rates differ? I would like to hear an explanation from the council. I’m sure many others are curious too.