Thursday, March 29, 2012
A business lobby group is planning a major campaign to press the Government into fast-tracking its overhaul of the State’s commercial rates system.
The Cork Business Association said urgent action is needed to ease the rates burden on struggling businesses and save jobs.
Spokesman Donal Healy said the association, led by its new president, Tom Durcan, will mount a sustained campaign over the next 12 months targeting senior government ministers on this crucial issue.
“We’re starting with a special networking lunch for our members next month, featuring an address by an expert in this area.”
Karl McCoy, of KMPC property consultancy, will explain how commercial rates work and what the Government needs to do to help businesses.
Commercial rates are an annual local tax levied by local authorities on occupiers of non-domestic property.
The tax is calculated based on the rateable valuation of the property, set by the Valuation Office, and the annual rate on valuation (AVR), a multiplier figure set by local authorities.
Cork City Council’s €74.05 AVR rate and Cork County Council’s AVR rate of €74.75 have remained unchanged since 2009.
It means that a city property with a rateable valuation of €100 pays €7,405 in commercial rates. But most rateable valuation rates were set in Nov 1998.
The Government began a nationwide revaluation process which began in South County Dublin in 2005, and continued with Fingal, Dún Laoghaire-Rathdown and Dublin City Council areas.
Documents were signed last December to start the process in Waterford county and city, and Dungarvan Town Council. It is expected the process will start in Limerick later this year.
Cork’s city councillors were told this week that revaluation is due to take place on Leeside next year.
But Mr McCoy said the slow delivery is doing nothing to help businesses who need action now.
“In circumstances where many businesses appear to be running simply to pay rent or rates and are struggling to the point of collapse, this slow delivery will be of little solace.
“What business needs is something that will help now. The alternative is to watch more business failure, the build-up of more vacant property resultant in more pressure on rateable occupiers.”
In a report to councillors this week, the head of Cork City Council’s finance department, Tim Healy, said the council does not accept that the rates burden, in itself, is contributing to the closure of businesses and job losses in the city.
City manager Tim Lucey said his officials are willing to listen to business owners who want to reschedule their payments.
And he pointed out that commercial rates arrears have declined from €4.2m in 2009 to €3.4m in 2010.
Commercial rates account for almost 40% of the city council’s income.
* The Cork Business Association’s networking lunch on the commercial rates issue will take place at Electric, on the South Mall, at 1pm on Apr 18. Tickets priced €25 are available from the CBA.