ADDENDUM FOR THE NON-US JURISDICTIONS GENERAL INFORMATION1
TABLE OF CONTENTS
AUSTRALIA ...... 3 Australian Capital Territory ...... 3 New South Wales ...... 4 Northern Territories ...... 5 Queensland ...... 6 South Australia ...... 12 Tasmania ...... 13 Victoria ...... 16 Western Australia ...... 17 CANADA ...... 20 Alberta...... 20 British Columbia ...... 23 New Brunswick ...... 26 Newfoundland & Labrador ...... 27 Nova Scotia ...... 30 Ontario ...... 32 Quebec ...... 36 Saskatchewan ...... 38 HONG KONG ...... 40 IRELAND ...... 42 NEW ZEALAND ...... 49 SINGAPORE ...... 51 SOUTH AFRICA...... 53 SPAIN ...... 59 1 | P a g e
THE NETHERLANDS ...... 61 UNITED KINGDOM ...... 62 England ...... 62 Northern Ireland ...... 65 Scotland...... 68 Wales...... 72
1. Information contained in this Addendum is based on details supplied in 2017/2018; there may have been some factual changes in a number of jurisdictions since then which are not reflected in the current version of the Addendum
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4. Unit of assessment? Rates, FESL, CCMIL & Land Tax: Unimproved Land Value AUSTRALIA Stamp Duty: Contracted sale price Safer Families Levy: N/A Australian Capital Territory LVC: Added Value 1. Title of Property Tax System? The ACT operates as both a State government and the local-municipal 5. Tax rate(s) set by? All are set by the ACT Gov. government. It has the following types of property 6. Current tax rate? All can be found on the ACT taxes, being: Revenue Website at: 1. General rates: levied annually on all property https://www.revenue.act.gov.au/ owners and is based on the property’s The fixed charge for different property categories in Unimproved Land Value 2017/18 is as follows: 2. Land Tax: charged quarterly on residential Property Fixed Charge properties that are rented (i.e. investment Residential $765 properties). Again, is based on the property’s Unimproved Land Value Commercial $2380 3. Conveyance Duty: charged on each property Rural $155 transaction. Purchaser pays a tax as a percentage The valuation charge for different property of the contracted sale price. Duty paid as part of categories in 2017/18 is as follows: the settlement of sale process Property Valuation Charge Rating 4. Fire and Emergency Services Levy (FESL): levied Factor annually on all property owners; based on the Residential $1 - $150,000 0.2960% property’s Unimproved Land Value for $150,001 - 0.4088% commercial properties and a flat rate for $300,000 residential properties. $300,001 - 0.5130% 5. Safer Families Levy: charged annually at a $450,000 determined amount on residential properties $450,001 - 0.5603% 6. City Centre Marketing and Improvements Levy $600,000 (CCMIL): applied to all rateable ACT commercial $600,001 and over 0.6013% properties within a defined area around the Commercial $1 - $150,000 2.9760% central business district. It is calculated based on $150,001 - 3.4940% the property’s Unimproved Land Value. $275,000 7. Lease Variation Charge (LVC): levied on all $275,001 - 4.9350% development applications for a lease variation to $600,000 capture the windfall gains from the variation. The $600,001 and over 4.9930% amount of charge varies depending on the type Rural Property value 0.1491% of variation. 2. Type of property taxed along with brief 7. Frequency of adjustment of tax rate(s)? Annually description? Rates and FESL: All property. for Rates, Land Tax, FESL & Duty; Infrequent for Land Tax: All revenue generating residential CCMIL, LVC & Safer Families Levy. properties. Conveyance Duty: All property transactions. 8. Tax collected by? All - ACT Revenue Department. Safer Families Levy: All residential properties. 9. Assessor responsible for assessments? The ACT CCMIL: All commercial properties in the City and Revenue Office is responsible for issuing assessment surrounding area for all taxes and the ACT Valuation Office is LVC: All development applications for a lease responsible for conducting land valuations. variation that result in an increased land value 10. Basis of valuation? Rates, FESL, CCMIL & Land Tax 3. Person tax legally imposed on? Rates, Land Tax, - Unimproved Land Value. LVC – Site Value. FESL, Safer Families Levy, CCMIL & LVC: The property owner. 11. Frequency of general revaluations? Rates & Land Conveyance Duty: The property purchaser Tax - Annually 3 | P a g e
12. Date of last general revaluation? Rates & Land Land tax – New South Wales Government. Tax – 1 January 2017 Administered through the Land Tax Management Act 1956 and the Valuation of Land Act 1916. 13. Valuation date used for current assessment period? Rates & Land Tax – 1 January 2017 6. Current tax rate? Council rates – Actual rate is set by individual local government councils with an 14. Main exemptions/reliefs? Charities, educational annual cap in rates increases imposed by the State institutions and religious institutions are the main Government. exemptions from property taxes. Land Tax Rate (2017) – $100 plus 1.6% for the amount 15. Initial appeal process? 60 days from date of issue over a land value of $549,000. of an assessment. Initial appeals are conducted by the If land value greater than $3,357,000, then 2% over Objections team of the ACT Revenue Office. that figure. 16. Independent body to determine unresolved 7. Frequency of adjustment of tax rate(s)? Reviewed appeals? ACT Civil and Administrative Tribunal annually. (ACAT). 8. Tax collected by? The Office of State Revenue 17. Property tax revenue vs. other revenue? The changed their name to Revenue NSW at the end of budgeted revenue for property tax is around 2017. $988 million in 2017-18. This counts for around half Revenue NSW sends out the annual land tax bills and of the total own-source taxation revenue and around collects the revenue. 18 per cent of the total revenue in the ACT. Each local government (council) sends out the bills for 18. Any significant recent changes and important council rates and collects the revenue. issues? None. 9. Assessor responsible for assessments? The valuations are prepared by private sector valuers New South Wales (contract valuers) operating under the guidance of 1. Title of Property Tax System? There are two types Property NSW on behalf of the NSW Valuer-General. of annual property tax in NSW: (a) land tax payable to the State government; 10. Basis of valuation? Market value as at 1 July in the (b) council rates payable to the local government. valuing year based on vacant land value. 2. Type of property taxed along with brief 11. Frequency of general revaluations? Valuations description? For council rates – the assessed rates are for land tax are carried out every year. levied on vacant land value and may include an Valuations for council rates are carried out every additional fixed amount per property or a minimum three years. amount. 12. Date of last general revaluation? The latest For land tax purposes – land tax is assessed solely on revaluation for land tax was carried out in 2016 and the vacant land value. came into effect on 1 January 2017. 3. Person tax legally imposed on? The owner is liable The latest revaluation for council rates was carried for payment of both land tax and council rates. out in 2016 and came into effect on 1 July 2017. However, many leases transfer responsibility for 13. Valuation date used for current assessment payment to the lessee. period? The date of valuation was 1 July 2016. 4. Unit of assessment? The unit of property owned by 14. Main exemptions/reliefs? The following a taxpayer, excluding improvements (i.e. buildings, exemptions and concessions apply for land tax: structures, etc.) • principal place of residence 5. Tax rate(s) set by? Council rates – Set by individual • primary production land local government councils with an annual cap in rates • boarding houses increases imposed by the State Government. • low cost accommodation Administered through the Local Government Act 1996 • residential parks, including caravan parks and the Valuation of Land Act 1916. • non-profit organisations 4 | P a g e
• retirement villages, aged care establishments and Tax is payable. Inside the NT, the only land-based tax nursing homes is Rates – issued by local Councils. Council rates provide relief for e.g. charities and not GST is a complicated tax for property and is levied for profit organisations where the vendor is registered usually on new and commercial properties. 15. Initial appeal process? Objections can be made to Capital Gains tax also applied to those assets whereby the value contained in the Notice of Valuation or Land a capital gain has been realised during the past Tax Assessment. financial year. Taxpayers have 60 days in which to make an objection. 3. Person tax legally imposed on? The Proprietor. There is provision for the Valuer General to accept 4. Unit of assessment? The unimproved capital value ‘out of time’ objections where adequate reasons are of the land owned. provided for lateness. 16. Independent body to determine unresolved 5. Tax rate(s) set by? Local Government sets the rates appeals? Land and Environment Court for differential rating - a different rate in the dollar is applied to different classes of property with the 17. Property tax revenue vs. other revenue? Local Unimproved Capital Value of the land being the basis Government rates – approximately $3,887,538,822 used for rating calculations by the council. collected during the 2016/2017 financial year from ordinary rates, with an additional $105,974,531 6. Current tax rate? There are 9 different local council raised through special rates. areas, of which, all have different rates in the dollar Land tax – approximately $3,134,357,397 collected for the different property types. Palmerston recently during the 2016/2017 financial year. Represents transferred from “flat rating”, whereby every land approximately 10% of state taxation revenue. owner pays the same, to the differential rating system (based on vertical equity). All Councils have different 18. Any significant recent changes and important rates applied based on the sum total of the UCV’s in issues? There is continuing discussion about that area and the budget that needs recovering. removing the exemption for land tax in respect of Rates vary for different types of zoning and are residential properties that are the principal residence generally in the range of 0.3 – 0.6 cents in the $ UCV. of the owner. The differential rates are applied to the assessed There was a major report on “Australia’s Future Tax unimproved capital value of the land. System” published in 2009 called the Henry Report The differential rating system is seen to be fairer and which, inter alia, recommended extending the land less vulnerable to market fluctuations. tax system. However, no action has been taken so far It also helps prevent major increases following the in respect of that recommendation. unimproved capital valuations every three years. A recent report has recommended a change for It has been based on Town Planning Zones under the council rating from land value to capital improved Planning Act. value (i.e. land and buildings) on the basis that this For City of Darwin, the 2017/18 differential rates are would make it easier for taxpayers to understand the as follows: system. Town Planning Zone Rate in $ Min Again, no action has so far been taken in respect of or % Rate this recommendation. UCV Single Dwelling Residential; Rural 0.420575 $1091 Residential; Rural Living; Rural Northern Territories Multiple Dwelling Residential; 0.420575 $1147 1. Title of Property Tax System? Council/Local Govt Medium Dwelling Residential; Rating. Federal GST. High Density Residential Caravan Parks 0.399922 $1091 2. Type of property taxed along with brief Central Business 0.485422 $1381 description? Council rates are based on land value Public Open Space; Conservation 0.374146 $1138 (UCV). All property (other than principle place of Organised Recreation 0.338519 $450 residence) is subject to tax. Outside of the NT, Land
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Future Development; Specific Use; 0.420575 $1147 Rates and annual charges – 67.4% Community Purposes; Restricted Fees and charges – 23.9% Development; Utilities; Grants and contributions – 5% Community Living Commercial; Service Commercial 0.555719 $1138 Interest income – 1.9% Tourist Commercial; Heritage 0.566387 $1138 Other income 1.8% Light Industry 0.340492 $1138 18. Any significant recent changes and important General Industry; Development 0.288145 $1138 issues? Land Tax is not levied, however there is There may be other rates, charges or levies that apply discussion on introducing Land Tax into the NT. to a particular property. These could include garbage The Department of Treasury and Finance “Northern charges or car parking shortfall levy. Territories Revenue Discussion Paper” November 7. Frequency of adjustment of tax rate(s)? Annually. 2017 suggested that: 8. Tax collected by? Local council “Introduction of an annual property tax would provide additional revenue that could fund government 9. Assessor responsible for assessments? Valuer services. It may also provide an opportunity to fund General NT other tax reform, such as reducing conveyance or 10. Basis of valuation? Unimproved capital value insurance stamp duty. Other tax reviews, such as the Australia’s Future Tax System Review, have 11. Frequency of general revaluations? At least 3 recommended that a move to reduce stamp duties yearly funded by annual property taxes would result in 12. Date of last general revaluation? There is no improvements in state and territory taxation common revaluation date. For example, the following systems.” revaluation programs are scheduled over the next There is no discussion as yet on how it would be three years. implemented e.g. vacant land only/improved 2017 - Darwin, Palmerston, Darwin Waterfront commercial etc. Precinct and the Northern Territory Rates Act area will be valued as at 1 July 2017. Queensland 2018 - Alice Springs, Litchfield, the eight regional 1. Title of Property Tax System? Apart from transfer councils including Tennant Creek, Tiwi Islands Shire duty, there are two forms of property tax in and all pastoral properties will be valued as at 1 July Queensland: 2018. 2019 - Katherine, Coomalie Shire and Wagait Shire A) Council Rates: One of the main sources of revenue will be valued as at 1 July 2019. for local authorities. Local authorities charge rates on all rateable property in their area. It is calculated by 13. Valuation date used for current assessment a rate in the dollar multiplied by the unimproved or period? 1 July in the year of revaluation. The values site value of the property owned in the local are then sent to Councils and are used as the basis for authority. collecting rates 12 months after the Base Date. B) Land Tax: Land tax is paid to the State Government 14. Main exemptions/reliefs? Traditional owners, and is assessed on the taxable value of an owner's Pastoralists. Charities, Religious bodies. total land-holdings in Queensland. Land tax is paid if the total taxable value exceeds the relevant 15. Initial appeal process? By way of objection to the threshold. An owner can apply for a land tax VG. exemption on their principal place of residence or if 16. Independent body to determine unresolved the property is used for primary production purposes. appeals? Valuation Board of Review if dissatisfied 2. Type of property taxed along with brief with VG ruling. description? A) Council Rates: All rateable land under 17. Property tax revenue vs. other revenue? the local government legislation. Real property Property tax revenue forms the main Council funding. including freehold and leasehold tenure. For example, City of Darwin 2017/18: B) Land Tax: Real property, freehold tenure only. Operating income $102.5m
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3. Person tax legally imposed on? The property 5. Tax rate(s) set by? Council tax rates are set by each owner as defined under land tax and local local government. government legislation. Land tax rates are set by the State government. 4. Unit of assessment? Land tax is calculated with 6. Current tax rate? A) Council Rates: Varies with each reference to the taxable value of an owner’s total land Local Authority, example of Brisbane City Council (See holdings (excluding exempt land) in Queensland. table below). Council rates are calculated on the land value of each B) Land Tax: There are two separate scales: one for rateable property owned by the taxpayer within the individuals (other than trustees or absentees) and local authority boundary. one for companies, trustees and absentees (See table). Land Tax Rates – 2017/18 (from Queensland Government website)
Rates for individuals (other than absentees, companies or trusts)
Taxable value Rate of tax $0–$599,999 $0
$600,000–$999,999 $500 plus 1 cent for each $ more than $600,000
$1,000,000–$2,999,999 $4,500 plus 1.65 cents for each $ more than $1,000,000
$3,000,000–$4,999,999 $37,500 plus 1.25 cents for each $ more than $3,000,000
$5,000,000 and over $62,500 plus 1.75 cents for each $ more than $5,000,000
Rates for companies, trustees and absentees
Taxable value Rate of tax $0–$349,999 $0
$350,000–$2,249,999 $1,450 plus 1.7 cents for each $ more than $350,000
$2,250,000–$4,999,999 $33,750 plus 1.5 cents for each $ more than $2,250,000
$5,000,000 and over $75,000 plus 2.0 cents for each $ more than $5,000,000
Council Rates – 2017/18 (from Brisbane City Council website)
Differential Differential Category Description general rate general rate Parity factor (cents in the minimum dollar) 1 Residential: Owner Occupied 0.2801 $685.88 1.0000
2a Commercial/Non-Residential – Group A 0.8896 $1,457.28 1.0000
2b Commercial/Non-Residential – Group B 0.8922 $66,199.12 1.0000
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2c Commercial/Non-Residential – Group C 0.8922 $114,411.84 1.0000
2d Commercial/Non-Residential – Group D 0.3268 $1,457.28 1.0000
2e Commercial/Non-Residential – Group E 0.8922 $137,090.68 1.0000
2f Commercial/Non-Residential – Group F 0.8922 $68,150.20 1.0000
2g Commercial/Non-Residential – Group G 0.8922 $134,450.64 1.0000
2h Commercial/Non-Residential – Group H 0.8922 $174,768.04 1.0000
2i Commercial/Non-Residential – Group I 0.7539 $24,116.84 1.0000
2j Commercial/Non-Residential – Group J 0.8922 $99,239.12 1.0000
2k Commercial/Non-Residential – Group K 0.8922 $7,971.80 1.0000
2l Commercial/Non-Residential – Group L 0.8997 $1,457.28 1.0000
3 Rural 0.3223 $614.28 1.0000
4 Multi-Residential 0.4760 $887.96 1.0000
5a Central Business District – Group A 1.3165 $1,879.80 1.0000
5b Central Business District – Group B 1.0632 $222,237.00 1.0000
5c Central Business District – Group C 0.9574 $242,440.24 1.0000
5d Central Business District – Group D 1.0765 $303,050.32 1.0000
5e Central Business District – Group E 0.9637 $363,660.40 1.0000
5f Central Business District – Group F 1.0941 $424,270.44 1.0000
5g Central Business District – Group G 1.2206 $484,880.56 1.0000
5h Central Business District – Group H 1.0650 $545,490.56 1.0000
5i Central Business District – Group I 1.5942 $599,921.52 1.0000
5j Central Business District – Group J 1.1617 $727,320.84 1.0000
5k Central Business District – Group K 1.8559 $875,271.84 1.0000
5l Central Business District – Group L 1.9380 $1,167,476.00 1.0000
5m Central Business District – Group M 1.3445 $1,277,180.00 1.0000
5n Central Business District – Group N 1.0268 $282,940.34 1.0000
5o Central Business District – Group O 1.4086 $1,317,438.00 1.0000
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5p Central Business District – Group P 1.5800 $1,685,887.52 1.0000
5q Central Business District – Group Q 1.9739 $2,039,490.00 1.0000
5r Central Business District – Group R 1.7897 $2,023,579.64 1.0000
5s Central Business District – Group S 1.9380 $1,091,247.00 1.0000
5t Central Business District – Group T 1.8551 $741,689.32 1.0000
5u Central Business District – Group U 0.9568 $258,937.68 1.0000
5v Central Business District – Group V 1.0787 $503,549.40 1.0000
5w Central Business District – Group W 1.2451 $105,000.00 1.0000
6 Other 0.8896 $1,457.28 1.0000
7 Residential: Non-owner Occupied or Mixed Use 0.3663 $894.24 1.0000
8a Large Regional Shopping Centre – Group A 1.1618 $188,591.68 1.0000
8b Large Regional Shopping Centre – Group B 1.1618 $178,776.08 1.0000
8c Large Regional Shopping Centre – Group C 1.4265 $175,337.60 1.0000
8d Large Regional Shopping Centre – Group D 1.1699 $199,558.56 1.0000
8e Large Regional Shopping Centre – Group E 1.1423 $224,392.44 1.0000
8f Large Regional Shopping Centre – Group F 1.1643 $338,927.40 1.0000
8g Large Regional Shopping Centre – Group G 1.5745 $424,374.72 1.0000
8h Large Regional Shopping Centre – Group H 1.2000 $370,902.80 1.0000
8i Large Regional Shopping Centre – Group I 1.1213 $472,076.60 1.0000
8j Large Regional Shopping Centre – Group J 1.3484 $503,548.40 1.0000
8k Large Regional Shopping Centre – Group K 1.2000 $642,851.44 1.0000
9a Major Regional Shopping Centre – Group A 1.4572 $1,111,112.96 1.0000
9b Major Regional Shopping Centre – Group B 1.2572 $1,236,246.76 1.0000
9c Major Regional Shopping Centre – Group C 1.4709 $1,537,289.04 1.0000
9d Major Regional Shopping Centre – Group D 1.3500 $1,545,225.88 1.0000
10 CTS – Residential: Owner Occupied 0.2791 $685.88 Refer TABLE ‘A’
11a CTS - Commercial/Non-Residential – Group A 0.9450 $1,457.28 Refer TABLE ‘A’
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11b CTS - Commercial/Non-Residential – Group B 0.9449 $1,457.28 Refer TABLE ‘A’
12 CTS - Multi-Residential 0.5885 $887.96 Refer TABLE ‘A’
13 CTS - Central Business District 1.1745 $1,879.80 Refer TABLE ‘A’
14 CTS – Residential: Non-owner Occupied or Mixed Use 0.3305 $894.24 Refer TABLE ‘A’
15 CTS – Minor Lot 0.9538 $716.76 Refer TABLE ‘A’
16 CBD Frame Commercial/Non-Residential 0.8834 $1,593.60 1.0000
17 CTS – CBD Frame Commercial/Non-Residential 0.9328 $1,593.60 Refer TABLE ‘A’
18 Commercial/Non-Residential – Special Concession 0.3752 $1,562.96 1.0000
19 CTS - Commercial/Non-Residential – Special 0.0871 $1,562.96 Refer TABLE ‘A’ Concession
20 Commercial/Non-Residential – Concessional 0.1330 $1,457.28 1.0000
21a Drive-In Shopping Centre < 20,000 m2 0.8937 $9,098.76 1.0000
21b Drive-In Shopping Centre 20,000 m2 to 25,000 m2 0.9519 $26,852.00 1.0000
21c Drive-In Shopping Centre 25,001 m2 to 50,000 m2 0.9345 $43,941.88 1.0000
21d Drive-In Shopping Centre > 50,000 m2 0.9289 $127,866.72 1.0000
22a Retail Warehouse < 7,500 m2 0.8645 $2,367.12 1.0000
22b Retail Warehouse 7,500 m2 to 20,000 m2 0.9059 $17,979.52 1.0000
22c Retail Warehouse 20,001 m2 to 40,000 m2 0.9321 $31,227.56 1.0000
22d Retail Warehouse 40,001 m2 to 90,000 m2 0.9096 $93,840.40 1.0000
22e Retail Warehouse > 90,000 m2 0.9465 $31,227.56 1.0000
7. Frequency of adjustment of tax rate(s)? Council 10. Basis of valuation? For both land tax and council tax rates are reviewed annually and set by each local rates: government. Non-rural land is valued on the basis of site value (Part State land tax rates are determined each year by the 2 Division 1 para 7 of the governing legislation) and is State government. defined as land that is zoned as not rural under a relevant planning scheme (Part 2 Division 1 para 8). 8. Tax collected by? A) Council Rates: Local Division 3 of the legislation defines the site value as Government the amount the land could be: B) Land Tax: State Government expected to realise in a bona fide sale (Para 17 & 18) 9. Assessor responsible for assessments? The including site improvements made to the land (Para valuations are prepared by the Valuer-General, State 23) such as earthworks (e.g. levelling, filling, drainage Valuation Service for Queensland, which is part of the etc) Department of Natural Resources, Mines and Energy. 10 | P a g e
excluding any non-site improvements (Para 24) on the Principal place of residence (if a person owns the land (e.g. houses, buildings or fences) home and lives mainly at that address), in its existing use, i.e. for which it is being used or Land used only for the business of primary could be used (Para 22) production, Rural land is valued on the basis of unimproved value Land used predominantly as a moveable dwelling (Part 2 Division 1 para 7) and is defined as zoned or park, declared rural land. Land owned by a charitable institution and used for a Division 3 of the legislation defines the unimproved qualifying exempt purpose (eg public benevolence, value as the amount the land could be: charity, education, religion, provision of care) expected to realise in a bona fide sale (Para 26) Land used as the location for an aged care facility excluding all site improvements and non-site A non-profit organisation using or occupying a improvements made to the land (Para 26) building on the land. in its existing use, i.e. for which it is being used or Land used for premises or facilities for residents of a could be used (Para 28) retirement village Land used for a supported accommodation service 11. Frequency of general revaluations? Land A & B) Concessions on valuations by State Valuation valuations are issued annually across the state, except Service under the Land Valuation Act 2010: in unusual circumstances, or where the Valuer- Deduction for Site Improvements (DSI) - granting of a General determines there has been insufficient deduction to particular owners of land for site market movement in a local government area to improvements to their land paid for by them in the warrant an annual valuation. previous 12 years 12. Date of last general revaluation? In 2017, 28 out Exclusive use as a single dwelling house or for farming of the 62 Local Government areas in Queensland – In deciding its value any enhancement in its value were revalued, which represents 73% of all properties because of potential for higher use must be in Queensland. disregarded. The new valuations are effective from 30 June 2017 Discount for subdivided land not yet developed - The for state land tax and local government rating local government must discount the value of the purposes. relevant parcel by 40% 13. Valuation date used for current assessment 15. Initial appeal process? Any landowner in period? The valuation date for the 2017 revaluation Queensland who does not agree with their statutory was 1 October 2016. land valuation (annual or maintenance valuation) may lodge an objection. 14. Main exemptions/reliefs? Council rates For an objection to be considered, the landowner exemptions: must: Unallocated State land provide sufficient information to demonstrate Land occupied by State or Government entity that the valuation is incorrect by including Land in a State forest acceptable grounds of objection with supporting Aboriginal land, evidence; acceptable grounds of objection are: Port land, rail corridor land, airport land, Land used (1) Sales evidence (specific details of comparable for religious, charitable, educational, recreational or property sales) supporting a different value; sporting, hospital, cemetery or other public purposes (2) Physical characteristics or constraints on the use Council rates relief varies by Local Authority, but of the land supporting a different value, examples include: including how these affect the value of the land; Pensioner remission (3) Any other issues which may affect the valuation Owner occupied cap on rate increases together with supporting evidence; Bushland preservation remission (4) Deduction for site improvements including full Not-for-profit rate remission details of the site works undertaken, costs, B) Land Tax exemptions: 11 | P a g e
receipts, who carried out the works and when and financial contributions, user charges and fees, they were paid for. and other revenue. be properly made in accordance with the Land Valuation Act 2010 (including specifying the 18. Any significant recent changes and important amount sought is mandatory where the value is issues? There is continuing discussion about greater than $750,000); otherwise a correction removing the exemption for land tax in respect of notice may be issued giving 28 days to comply residential properties that are the principal residence from the date of issue of the correction notice of the owner. lodge the objection within 60 days of the date of issue of the valuation notice. South Australia A properly made objection will be considered by a 1. Title of Property Tax System? Land tax, Council senior departmental valuer appointed by the Valuer- rates, Emergency Services Levy (ESL) and Water and General. Sewerage rates. Where the site value exceeds $5m, the Valuer- 2. Type of property taxed along with brief General must extend an invitation to an objection description? Land tax – site value (land only) however conference chaired by an appointed independent exemptions available e.g. principle place of residence person. and if the property is used for the business of primary A written decision, with reasons, will be issued. production The landowner may appeal this decision to the Land Council rates – site and capital value (land + Court within 60 days of the issue of the notice. improvements) where rebates and exemptions exist An appeal against the decision of the Land Court may under the Local Government Act 1999 be made to the Land Appeal Court. ESL and Water and sewerage rates – capital value only Further appeal is by leave to the Court of Appeal on questions of law. 3. Person tax legally imposed on? Land tax, ESL and Water and sewerage rates – owner 16. Independent body to determine unresolved Council rates – owner or ratepayer appeals? To challenge a valuation objection decision an appeal can be lodged with the Land Court of 4. Unit of assessment? Each separately saleable Queensland. parcel of land which can be amalgamated into a single To challenge an internal review decision (after an assessment or part thereof can be valued if separately application to change the valuation methodology), an occupied. owner can apply for an external review through the 5. Tax rate(s) set by? Land tax, ESL and Queensland Civil and Administrative Tribunal (QCAT). Water/Sewerage – set by State Government Council Rates: After objecting to a property’s rating Council rates – set by Local Government. category, an appeal against the decision can be lodged with the Land Court. 6. Current tax rate? Please refer to the following web sites: 17. Property tax revenue vs. other revenue? In Land tax and ESL – www.revenuesa.sa.gov.au Queensland, in 2016-17, land tax raised The adjusted thresholds for 2017/18 are: approximately $1.082 billion or 8.4% of total taxation Total Taxable Site Value Amount of Tax revenue. Does not exceed Nil In this period, total taxation revenue amounted to $353,000 20% of total revenue of $64.84 billion. $353,001 - $647,000 $0.50/$100 above For Brisbane City Council, the revenue from rates $353,000 provides approximately $1.64 billion (45%) of the $647,001 - $941,000 $1470 + $1.65/$100 above $647,000 council’s funding. $941,001 - $1,176,000 $6321 + $2.40/$100 The remaining $2 billion (55%) of the council’s above $941,000 funding comes from grants, subsidies, development Exceeds $1,176,001 $11961 + $3.70/$100 above $1,176,000
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SA Water – www.sawater.com.au Valuer-General, or a decision made by the Local Government Association – www.lga.sa.gov.au independent review valuer. 7. Frequency of adjustment of tax rate(s)? All 17. Property tax revenue vs. other revenue? reviewed annually. Property tax revenue makes up 70% to 80% of local government revenue, and about 11% to 15% of State 8. Tax collected by? Land tax, ESL and SA Water – based revenue. State Government Council rates – Local Government 18. Any significant recent changes and important issues? Stamp Duty is being phased out for 9. Assessor responsible for assessments? Valuer- commercial transactions. It was suggested that there General and Councils; Councils have the ability under should be a broadening of the land tax base across all the Local Government Act to appoint their own property values, however as yet there has been no valuer. change. 10. Basis of valuation? Site value and capital value. The City of Adelaide Council use an annual value. Tasmania 11. Frequency of general revaluations? Annually. 1. Title of Property Tax System? There are two property tax systems in Tasmania. 12. Date of last general revaluation? 30 June 2017 Land Tax – Land Tax is calculated on the Land Value as Work on the 2018-19 general valuation is currently determined by the Valuer-General of Tasmania. underway, which will have a date of valuation as of 1 Council rates - The majority the 29 municipal areas of Jan 2018. The new valuations will come into force on Tasmania base their rates on the Assessed Annual midnight 30 June 2018. Value (AAV) of the property. AAV is the gross annual rental value of a property, excluding GST, council 13. Valuation date used for current assessment rates and land tax, but is not to be less than 4% of the period? 1st January 2017 Capital Value. In 2017/2018 - 22 municipalities base their rates on AAV with 7 using a mixture of Capital 14. Main exemptions/reliefs? Notional values for Value, AAV and Average Area Rating models as the principal place of residence and if property is used for basis for their municipal rates. primary production purposes. Also, heritage 2. Type of property taxed along with brief considerations. description? Land Tax - applied to properties known 15. Initial appeal process? Objection process where as ‘general’ land. The amount of tax payable on land an owner or person who has an interest in a property in this category is assessed as at 1 July each year. can object to their property’s valuation to the Valuer- Refer to later question for the properties exempt General within 60 days of their first-rate notice from from land tax. Council Rates - Until the 2011-12 rating year all of any of the rating authorities. The objection must be Tasmania’s 29 councils elected to use AAV as the basis in writing and there is no fee. of their rates resolutions. In 2017/2018 - 22 16. Independent body to determine unresolved municipalities based their rates on AAV with 7 using a appeals? There is a review panel comprised of private mixture of Capital Value, AAV and Average Area sector valuers appointed by the Governor every 3 Rating models as the basis for their municipal rates. Tasmania’s councils are using a variety of tools to set years. rates for their council areas. This is in keeping with the In addition to the independent review of the intent of the Local Government legislation, which valuation by a panel valuer appointed by the gives broad parameters for the setting of rates, while Governor, there is also a review by a Tribunal referred recognizing the autonomy of Local Government and to as SACAT (or the South Australian Civil and the flexibility it requires in relation to the raising of Administrative Tribunal). The Tribunal replaces the revenue to deliver services for communities. There role the Supreme Court played in resolving has been a good level of take-up of the rating tools dissatisfaction with objection decision made by the provided by the Local Government Amendment Act 2001.
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3. Person tax legally imposed on? Land Tax – Revenue Office has jurisdiction over the amount and property owner. who pays Land Tax. Council rates – property owner or rate paying lessee. Council rates – The Office of the Valuer-General determines the land value, capital value and AAV 4. Unit of assessment? Land Tax – Land Value as at 1 relevant to each property or tenancy; however, each July each year of each unit of ownership. municipal council is responsible for their own rating Council rates - Section 90 of the Local Government resolutions and level of rates. Act 1993 enables a council to set a general rate on rateable land, based on values of land (as defined in 10. Basis of valuation? Land Tax – Land Value the Valuation of Land Act 2001) - Land Value, Capital Council Rates - Land Value, Capital Value and AAV. In Value or Assessed Annual Value; unit of ownership. 2017/2018 - 22 municipalities base their rates on AAV The composition of the general rate is outlined in with 7 using a mixture of Capital Value, AAV and section 91 of the Local Government Act 1993 and can Average Area Rating models as the basis for their have two parts: an ad valorem rate (a proportion of municipal rates. value or rate in the dollar) and a fixed charge. 11. Frequency of general revaluations? Fresh 5. Tax rate(s) set by? Land Tax – State Revenue Office Valuations (revaluations) currently occur every six Council rates – Individual Municipal Councils. years with interim Adjustment Factors annually for Land Tax purposes and biennially for Municipal rating 6. Current tax rate? Land Tax – State Revenue Office purposes. Rates of Land Tax (from 1 July 2010). A Review was undertaken by the Department of Total Land Value Current Tax Scale Premier and Cabinet (Local Government Division) in relation to the future frequency and basis of valuations, however, the review has been completed $0 – $24 999 Nil without the recommendations being adopted. Therefore, there is no change to the current six-year $25 000 - $349 999 $50 plus 0.55% of revaluation cycle or adjustment factor program. value above $25,000 12. Date of last general revaluation? Fresh valuations (revaluations) are issued on a moving 6-year cycle. $350 000 and above $1 837.50 plus 1.5% of 1 July 2012 – 10 councils (due again by 1 July 2018) value above $350,000 1 July 2014 – 9 councils (due again by 1 July 2020) 1 July 2016 – 10 councils (due again by 1 July 2022) Note: Where two or more properties are held by one Tenders are currently being advertised for the next owner, the assessed land value of the properties is round of revaluations for the 10 councils last valued aggregated (added together). Land tax is then as at 1 July 2012. The new valuation date will be 1 July calculated on the total (aggregated) land value. 2018 and due for return in February 2019 effective for Council rates – The amount of rates is determined by each individual municipal council depending on their the 2019/2020 rating year. revenue needs to deliver services within their area. 13. Valuation date used for current assessment 7. Frequency of adjustment of tax rate(s)? Land Tax period? 1 July in the year of revaluation. The values – Annual are proclaimed and become effective for rating and Council rates – Annual. Additional rates notices are taxing purpose in the following year 1 July. (i.e. issued whenever a change occurs to the Land Value, 2012/13 revaluation become effective 2013/14 rating Capital Value and the AAV as determined by the and taxing year). Valuer-General as part of the supplementary valuation process. 14. Main exemptions/reliefs? Land Tax – is not payable on the following types of property: 8. Tax collected by? Land Tax – State Revenue Office An owner's principal place of residence. This Council rates – Individual Municipal Councils. is land on which a dwelling is erected. The 9. Assessor responsible for assessments? Land Tax – dwelling must be the place where the owner The Office of the Valuer-General determines the of at least a 50% interest in the land relevant land value for each property. The State 14 | P a g e
ordinarily eats and sleeps. Leaving personal 15. Initial appeal process? Land Tax – direct to the possessions at a property or using it as a Commissioner of State Revenue. weekend home generally does not qualify Council rates – property owners or rate paying lessees the property for the classification. can write directly to the relevant municipal council. Primary production land which is used There is no set format. substantially for the business of primary Neither are within the jurisdiction of the Valuer- production. Also included are private timber General. reserves declared under the Forest Practices Section 28 of the Valuation of Land Act 2001 outlines Act 1985. the objection process against a valuation. Property used by the owners for religious That Section states - purposes; as a medical establishment; for An owner of land who is dissatisfied with – Aboriginal cultural activities and is Aboriginal (a) a valuation of that land made under section 11, 18, land; and/or used to operate a retirement 20 or 21; or village, or for related purposes; Or if: (b) the provision of a certificate under section 44; may, within 60 days after receipt of a notice under the land is subject to a conservation covenant; or owned by a charitable section 27 or the provision of that certificate, post to institution. or lodge with the Valuer-General an objection, in an Where a principal place of residence is built on vacant approved form, against the relevant valuation stating land owned as at 1 July of a financial year, a rebate up fully and in detail the grounds on which he or she to the amount of the land tax paid or payable can be relies and stating any changes to the values specified claimed. in that valuation or certificate which he or she Sporting clubs are not exempt but may be entitled to considers should be made. a concessional rate of tax depending on the rules or In relation to adjustment factors for both Land Value objectives of the club. and AAV, Section 50B of the Valuation of Land Act In certain circumstances, deferring payment or paying 2001, provides a process for the review of a by instalments may be available. The State Revenue determination as follows: Office must consider a case to be of genuine financial (1) An owner of land or a rating authority, within a hardship before agreeing to either of the above. If period of 60 days after a copy of a determination is approved, instalments can only be paid by direct debit published in the Gazette under section 50A, may from the applicant’s bank or similar financial apply to the Valuer-General for a review of that institution account and the applicant must maintain determination. sufficient funds in their account to guarantee (2) An application for a review of a determination is payment by the agreed due date/s. to be in writing and accompanied by a statement of Council rates – Each Council determines their own the grounds on which the application is made and any rating resolutions and main exemptions/rate reliefs, supporting evidence on which the applicant proposes however the Department of Treasury and Finance (via to rely. the State Revenue Office), provides a facility for (3) As soon as may be practicable, the Valuer-General eligible pensioners (ie those that include health care is to – card holders) to be granted a rates remission of the (a) consider the application; and lesser of the prescribed maximum amount; or 30% of (b) affirm or vary the determination to which it the rates. The property that the rates remission relates. applies to must be the principal place of residence, i.e. (4) The Valuer-General is to – the property where the person usually lives, eats and (a) give notice in writing of any variation or sleeps. affirmation to the applicant; and The prescribed amounts for 2017-18 are: (b) cause a copy of any varied adjustment factor to $299 for a TasWater client; or be published as provided by section 50A(7)(b). $440 for a non-TasWater client. (5) A determination varied under this section has the same effect as if it had been made under section 50A. 15 | P a g e
(6) A determination, affirmation or variation made by means the sum which land, if it were held for an the Valuer-General under this Part is not subject to estate in fee simple unencumbered by any lease, review under the Judicial Review Act 2000. mortgage or other charge, might be expected to realize at the time of valuation if offered for sale on 16. Independent body to determine unresolved any reasonable terms and conditions which a genuine appeals? Land Tax –Disagreements and objections seller might in ordinary circumstances be expected to are made to the Commissioner for State Revenue. require. Council rates - In relation to a valuation for land value, The Fire Services Property Levy Act refers to the capital value or AAV, Section 34 of the Valuation of Valuation of Land Act for the definition of capital Land Act 2001, outlines the role and procedures for improved value. the Land Valuation Court. 5. Tax rate(s) set by? The State government sets the 17. Property tax revenue vs. other revenue? Land tax rate for land tax and FSPL. Tax – In Tasmania, the State Revenue Office estimate Each local government (council) sets the tax rate for that approximately $96.50m will be raised in 2017/18 council rates. via Land Tax. The total taxation revenue will be approximately $1075m, and the total General 6. Current tax rate? For council rates it varies from Government Sector Revenue will be approximately each Local Govt depending on the revenue required $5500m. The following tax rates apply in respect of land tax for Council rates – Not available. 2017:
18. Any significant recent changes and important TOTAL TAXABLE VALUE LAND TAX PAYABLE issues? None OF LAND HOLDINGS <$250,000 Nil Victoria $250,000 to $275 plus 0.2% of amount > 1. Title of Property Tax System? There are three <$600,000 $250,000 types of annual property tax in Victoria: $600,000 to $975 plus 0.5% of amount > (a) land tax payable to the State government; <$1,000,000 $600,000 (b) council rates payable to the local government $1,000,000 to $2,975 plus 0.8% of amount > <$1,800,000 $1,000,000 (c) fire services property levy payable to the State $1,800,000 to $9,375 plus 1.3% of amount > government. <$3,000,000 $1,800,000 $24,975 plus 2.25% of amount > 2. Type of property taxed along with brief $3,000,000 and over $3,000,000 description? Real property
3. Person tax legally imposed on? The owner 7. Frequency of adjustment of tax rate(s)? Annually 4. Unit of assessment? Sites in separate occupation. 8. Tax collected by? The State Revenue Office sends For land tax, the property that forms the basis of the out the annual land tax bills and collects the revenue. assessment is land only; no improvements (i.e. Each local government (council) sends out the bills for buildings, structures, etc.) are included in the council rates and collects the revenue. valuation. The relevant legislation is contained in Section 19 (1) 9. Assessor responsible for assessments? The of the Land Tax Act 2005: Taxable value of land: The valuations for council rates are prepared either by valuers employed by the council or by private sector taxable value of land for a tax year is an amount equal to the site value of the land as at the relevant date. valuers contracted by the council. For council rates in Melbourne, the net annual value It has recently (May 2017) been announced that, from is based on the capital improved value which includes 2019, all valuations will be the responsibility of the Valuer-General. buildings and other improvements on the land. According to the Valuation of Land Act 1989 and the Local Government Act 1989: "capital improved value" 16 | P a g e
10. Basis of valuation? The basis of land tax is “site the taxpayer and the valuer responsible for reviewing value” which is the unimproved value of the land the valuation. excluding capital improvements such as buildings. 17. Property tax revenue vs. other revenue? The relevant legislation is contained in Section 19 (1) Property taxes contribute on average 50 % of total of the Land Tax Act 2005: Taxable value of land: The Council revenue or 10 % of total tax revenue. taxable value of land for a tax year is an amount equal to the site value of the land as at the relevant date. 18. Any significant recent changes and important The basis of council rates in Melbourne is “net annual issues? There is continuing discussion about value” which is calculated by taking 5% of the removing the exemption for land tax in respect of property’s capital improved value. residential properties that are the principal residence The relevant legislation is the Local Government Act of the owner. 1989. The basis of tax for the Fire Services Property Levy Western Australia (FSPL) is Capital Improved Value; the relevant 1. Title of Property Tax System? There are two legislation is the Fire services Property Levy Act 2012. valuation rolls used for rating and taxing in Western 73 municipatilies adopt capital improved value and 6 Australia; adopt net annual value. a) Unimproved value (UV): 11. Frequency of general revaluations? Revaluations a.1 Site value within Perth Metro Region and all town are carried out every two years. sites, includes merged improvements It has recently (May 2017) been announced that a.2 land outside townsites – unimproved value of land annual revaluations will be introduced from 2019. assuming any improvements hadn’t been made. 12. Date of last general revaluation? 2016 was the A number of formulae driven approaches apply to less last revaluation year for land tax. than freehold interests. 2016 land values were used for land tax calculations b) Gross Rental Value (GRV): in 2017. “gross rental value” of land means the gross annual The same dates apply for council rates. rental that the land might reasonably be expected to realize if let on a tenancy from year to year upon 13. Valuation date used for current assessment condition that the landlord were liable for all rates, period? 1st January 2016 taxes and other charges thereon and the insurance 14. Main exemptions/reliefs? Land tax does not and other outgoings necessary to maintain the value apply to exempt land. of the land, The most common exemptions are for: Where GRV can’t be determined on the primary a principal place of residence; definition above, assessed value applies: a farm, known as primary production land; “assessed value” of land means such percentage of all land owned if the total site value is under the capital value thereof as may from the threshold of $250,000; time to time be prescribed; rooming houses and charitable institutions. This currently 3% for residential land and 5% for all For council rates, there is no exemption for a principal other lands. place of residence. 2. Type of property taxed along with brief 15. Initial appeal process? Land tax payers can lodge description? Real property for both. a Land Valuation Objection Form within two months NB: In some properties plant and equipment have of receiving their assessment. been ruled by the courts to be included in the gross 16. Independent body to determine unresolved rents/assessed value (e.g. Lifts and running gear). appeals? There is an independent third party – the 3. Person tax legally imposed on? Owner. Victorian Civil Administrative Tribunal – which hears appeals that cannot be settled by discussion between 17 | P a g e
4. Unit of assessment? Rateable value determined in $66,550 + 2.00 cents a general valuation and published in a ‘valuation roll’. $5,000,000 $11,000,000 for each $1 in excess of $5,000,000 5. Tax rate(s) set by? LAND TAX - set by the Office of State Revenue (OSR), Department of Finance. $186,550 + 2.67 METROPOLITAN REGION IMPROVEMENT TAX – set by cents for each $1 in $11,000,000 the State Planning Commission/ Metropolitan Region excess of scheme but collected by OSR. It is a tax in the form of $11,000,000 additional land tax and assessed on the same basis. It applies principally to urban property owners who obtain the main benefit from development of Note: The land tax rate scale is reviewed annually as development and infrastructure requiring funding. part of the budget review process LOCAL GOVERNMENT RATES – set by 138 METROPOLITAN REGION IMPROVEMENT TAX – autonomous local governments in accordance with (MRIT) 0.14 cent for every dollar of the land-taxable provisions of the Local Government Act 1995. value Gazetted and subject to audit by Dept Local BIOSECURITY LEVY – rate not yet known, applied to Government and Communities. the rural land values (Unimproved, uncleared). EMERGENCY SERVICES LEVY – set by Dept of Fire and LOCAL GOVERNMENT RATES Emergency Services (DFES). GRV based and universal GRV - urban land and UV - agricultural land and levy applying to otherwise non-rateable land. remote/pastoral land. Some land at the edge of urban RESIDENTIAL WASTE WATER and all main drainage local governments remain on UV. charges (GRV based) - set by the Water Corporation. Each local government set their own rates in the $ of BIOSECURITY LEVY - new tax to be progressively value. collected from owners of agricultural land by the Dept An example is City of Perth - for 2017/18 the of Primary Industries and Regional Development (UV differential rates are as follows: based). Type of Minimum Cent/$ GRV Property Rate 6. Current tax rate? LAND TAX All $705 TAX TABLE – UNIMPROVED VALUE – 2017/18 Residential 5.69477 Aggregated Taxable Value of Commercial 5.51929 Land Rate of Land Tax Office 4.51513 Vacant Land 6.20898 Not Exceeding WATER CORPORATION and APPROVED AGENCIES (eg $0 $300,000 Nil Fire and Emergency Service levy) - Each set their own based on GRV. $300,001 $420,000 Flat rate of $300 7. Frequency of adjustment of tax rate(s)? LAND TAX $300 + 0.25 cent for – reviewed annually, however have remained stable $420,000 $1,000,000 each $1 in excess of of past 5 years. $420,000 LOCAL GOVERNMENTS – annual and typically always change $1,750 + 0.90 cent OTHER AGENCIES – as required - typically annually $1,000,000 $1,800,000 for each $1 in excess of $1,000,000 8. Tax collected by? LAND TAX, MRIT and BIOSECURITY LEVY- Office of State Revenue (Finance $8,950 + 1.80 cents Dept) on behalf of agencies. $1,800,000 $5,000,000 for each $1 in excess LOCAL GOVERNMENT RATES AND FIRE AND of $1,800,000 EMERGENCY SERVICE LEVY – Local governments (ESL collected on behalf of DFES).
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WATER AND DRAINAGE RATES (Where based on GRV) under the Mining Act 1978 – Water Corporation of Western Australia and in respect of land the area approved water providers. of which does not exceed 10 hectares or a 9. Assessor responsible for assessments? Valuer- miscellaneous licence held General under that Act; or
10. Basis of valuation? See answer to first question. (II) where and to the extent and manner in which a 11. Frequency of general revaluations? Unimproved person mentioned in values – annual paragraph (f) of the Gross Rental Value – varies according to a general definition of owner in valuation cycle by district. Major areas 3 yearly, section 1.4 occupies or others 4 years. There are 138 local governments in makes use of the land. Western Australia. (b) land in the district of a local government while it is owned by the local government 12. Date of last general revaluation? Unimproved and is used for the purposes of that local values currently in force – 30 June 2017 government other than for purposes of a Gross Rental Values – as required in cycle, see above. trading undertaking (as that term is defined in and for the purpose of section 3.59) of the 13. Valuation date used for current assessment local government; period? 1st August 2016. The date of valuation is 1 (c) land in a district while it is owned by a August of the year preceding the date the general regional local government and is used for the valuation comes into force (i.e. 30 June for UV and 1 purposes of that regional local government July for GRV) except the 30 LGs within Perth other than for the purposes of a trading Metropolitan Region where the general valuation undertaking (as that term is defined in and comes into force 23 months after the date of for the purpose of section 3.59) of the valuation. regional local government; (d) land used or held exclusively by a religious 14. Main exemptions/reliefs? Usual exemptions body as a place of public worship or in apply across all rating and taxing – typically Crown relation to that worship, a place of residence lands, public purposes, religious, private schools and of a minister of religion, a convent, nunnery institutions, charitable institutions, show grounds, or monastery, or occupied exclusively by a local government owned land not used for profit, are religious brotherhood or sisterhood; exempt from rates and land taxes. See S6.26 Local (e) land used exclusively by a religious body as a Government Act 1995 below for full details: school for the religious instruction of 6.26 Rateable land children; (f) land used exclusively as a non-government 1) Except as provided in this section all land within school within the meaning of the School a district is rateable land. Education Act 1999; 2) The following land is not rateable land: (g) land used exclusively for charitable (a) land which is the property of the Crown and purposes; (i) is being used or held for a public purpose; (h) land vested in trustees for agricultural or or horticultural show purposes; (ii) is unoccupied, except (i) land owned by Co-operative Bulk Handling (I) where any person is, under Limited or leased from the Crown or a paragraph (e) of the statutory authority (within the meaning of definition of owner in that term in the Financial Administration and section 1.4, the owner of Audit Act 1985) by that company and used the land other than by solely for the storage of grain where that reason of that person company has agreed in writing to make a being the holder of a contribution to the local government; prospecting licence held 19 | P a g e
(j) land which is exempt from rates under any 18. Any significant recent changes and important other written law; and issues? None. land which is declared by the Minister to be exempt from rates CANADA 3) If Co-operative Bulk Handling Limited and the relevant local government cannot reach an Alberta agreement under subsection (2)(i) either that 1. Title of Property Tax System? The assessment of company or the local government may refer the properties is referred to as “property tax”. The matter to the Minister for determination of the governing legislation is The Municipal Government terms of the agreement and the decision of the Act, Revised Statue of Alberta 2000, Chapter M-26. Minister is final. 4) The Minister may from time to time, under 2. Type of property taxed along with brief subsection (2)(k), declare that any land or part of description? Land and Improvements: any land is exempt from rates and by subsequent Land and improvements are assessed using a market declaration cancel or vary the declaration. value-based standard, except farmland, railways, 5) Notice of any declaration made under subsection linear properties, and machinery and equipment, (4) is to be published in the Gazette. which are regulated and assessed in accordance with 6) Land does not cease to be used exclusively for a the Alberta Assessment Minister’s Guidelines. purpose mentioned in subsection (2) merely Business Tax: because it is used occasionally for another The definition of a business is found in The Municipal purpose which is of a charitable, benevolent, Government Act Sec. 1(1)(a). The Business Tax is religious or public nature. In addition, land tax exemptions apply to nearly all governed by Division 3, Part 10 of the Act. The primary producers meeting certain tests, all principle municipal council may choose to raise revenue by places of residence, pastoral leases, all mining and imposing a business tax. The municipal council must petroleum tenements. In addition, relief by way of pass a bylaw in order to impose a business tax. rebates and concessions apply to pensioners. 3. Person tax legally imposed on? Land and The one exception applies to the DFES ESL – this is a Improvements: owner of record (i.e. the Land Title) or universal levy applying to all land owners including holder of a lease, license or permit as stipulated in The land exempt under the other rating and taxing laws. Owners of uncleared land in agricultural areas may Municipal Government Act Sec. 304. receive a concessional valuation where they enter Business Tax: Occupant. into a Soil and Land Conservation Agreement. 4. Unit of assessment? The unit of taxable property is Owners of land subject to a registered Heritage the parcel of ownership, lease, license or permit Agreement may also receive various concessions and including land and improvements. bonuses. 5. Tax rate(s) set by? The Municipal Council is 15. Initial appeal process? Formal objection rights to responsible for setting the tax rate through the Tax the Valuer-General within 60 days of the issue of a Rate Bylaw, however the education portion of the notice for rates or taxes or the date the general overall tax rate is established at the provincial level by valuation is gazette by the Valuer-General whichever the Province of Alberta. date is the latter. 6. Current tax rate? The tax rates vary by 16. Independent body to determine unresolved municipality. appeals? The State Administrative Tribunal of The following are examples: Western Australia, Resources Division - Edmonton 2017 Tax Rates http://www.sat.justice.wa.gov.au/default.aspx 17. Property tax revenue vs. other revenue? Land Tax is approximately 9.6% of total state taxation and 2.9% of General Government Operating Revenue. Local Government Rates – not available. 20 | P a g e
8. Tax collected by? The Municipal Council is also responsible for calculating the taxes payable and collecting the taxes. 9. Assessor responsible for assessments? The valuations are carried out by the assessor. Under Section 284 of the Act the minister appoints a provincial assessor, and municipalities must appoint a municipal assessor. The municipal assessor prepares assessments for all Calgary 2017 Property tax rates set by Property Tax property in the municipality except for those which Bylaw 21M2017. are the responsibility of the provincial assessor. The provincial assessor prepares assessments for linear property (electrical power and telecommunications systems and pipelines) and, as from January 1, 2018, Designated Industrial
Calgary 2017 Business Tax Rate: 0.0308 Properties (DIP) which includes major plants stipulated in the regulations in addition to the linear property outlined above. 10. Basis of valuation? Valuation standards are laid out in the Matter Relating to Assessment and Taxation Regulation (MRAT) which stipulates that market value is the standard unless MRAT imposes a different standard for a defined property type and it does that for agricultural, railway, linear properties as well as machinery and equipment. For 2018 the Designated Industrial Property type is added to the excluded from market value category. 11. Frequency of general revaluations? Properties are revalued annually. 12. Date of last general revaluation? Annual revaluations are required for all municipalities.
13. Valuation date used for current assessment period? The valuation date is July 1 in the year preceding the tax year. The condition date of the assessment reflects the characteristics and physical condition of the property on December 31 of the year prior to the year in which the tax is imposed, except for linear property which relates to the specifications and characteristics on October 31 of the year prior to the year in which the tax is imposed.
14. Main exemptions/reliefs? The following are 7. Frequency of adjustment of tax rate(s)? The tax exempt from property tax: rate is reviewed annually. • Most farm residences and improvements; • Environmental, municipal, and school reserves; 21 | P a g e
• Government properties such as hospitals, libraries, the appeal timeframe is 60 days from the date of and schools; decision of the ARB. • Colleges and universities; 17. Property tax revenue vs. other revenue? • Privately operated schools; Property tax and business tax are the primary sources • Churches and cemeteries; of municipal funding as well as provincial education • Property owned by some non-profit organizations funding. The municipality may supplement their such as benevolent societies, boys’ and girls’ clubs, revenue by government grants in lieu of property tax etc.; and on government owned property, Business • Hostels unless the property is operated for profit or Revitalization Zone Tax, Local Improvement Tax etc. gain. 18. Any significant recent changes and important 15. Initial appeal process? Part 11 of the Act relates issues? The Municipal Government Act S. 285 to appeals and the establishment of Assessment delegates the property assessment function to each Review Boards (ARBs). municipality. Under current legislation, all but linear There are two types of assessment review board: properties are assessed by the municipal assessor and The Local Assessment Review Board (LARB) is the Minister appoints a provincial linear assessor comprised of three members appointed by the (S.292). municipality and hears complaints on: There has been a significant review conducted of the • tax notices other than property tax notices; MGA and "Designated Industrial Properties" which • assessments of residential property with three or include machinery and equipment, pipelines and rail fewer dwelling units; and lines which are valued using regulated rates and • assessments for farmland. processes will, starting on January 1, 2018, be The Composite Assessment Review Board (CARB) is assessed by a central group in the Department of comprised of two members appointed by the Municipal Affairs. There has been significant appeal municipality and a provincial member appointed by activity historically dealing with these regulated the province and hears complaints on: properties and, as a result, the regulations have also • non-residential property assessments; been amended in an attempt to clarify the intent and • assessments of residential property with four or application of processes. Along with this change has more dwelling units; and come the ability for municipalities to have access to • machinery and equipment assessments. Complaints the confidential information needed to assess these about linear properties and equalized assessments properties to allow them to determine if they should are heard by the Municipal Government Board lodge an appeal against the values determined by the (MGB). Province. 16. Independent body to determine unresolved A recent report by the Canadian Federation of appeals? An ARB decision can be appealed to the Independent Business (CFIB) has called for the Court of the Queen’s Bench on questions of law or unfairness of the property tax gap between jurisdiction. commercial and residential tax rates in Alberta to be The appeal can be made by any of the following: addressed. To ensure the property tax system is fair • an assessed person; and balanced, the CFIB is recommending that: • a taxpayer; • Municipalities reduce the tax gap through restraint • an assessor; or in municipal operating spending; • a municipality, if the decision being appealed relates • The province continues to reject proposals calling to property that is within the boundaries of that for increased taxation or revenue generating powers municipality. for municipalities; and An application for leave to appeal must be filed with • Commercial-to-residential rates should be capped the upper court within 30 days of the notification of at a maximum of 2:1, as the newly adopted 5:1 ratio the decision of the ARB, however effective from 2018 does not fundamentally address the issue of fairness.
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(http://www.municipalaffairs.alberta.ca/mga_revie products, including ancillary storage. Scrap metal w.cfm) yards, wineries and boat-building operations fall within this category. Exceptions include properties British Columbia used for the production or storage of food and non- 1. Title of Property Tax System? The tax is called alcoholic beverages and retail sales outlets, which fall “annual property tax”. into Class 6. Class 6: Business and Other — property used for Property taxes are calculated on the basis of the offices, retail, warehousing, hotels and motels all fall market value (or "assessment") of land, within this category. This class includes properties improvements, or both (i.e. house, barn, garage, that do not fall into other classes. yard) and the municipal "tax rate". Most local governments calculate taxes using the Class 7: Managed Forest Land — privately-owned, variable tax rate system where tax rates are based on forest land managed in accordance with the Private a dollar figure per $1,000 dollars of assessed property Managed Forest Land Act or the Forest and Range value (i.e. $1.02/$1,000). Practices Act. Property owners in this class have an 2. Type of property taxed along with brief obligation to provide good resource management description? Real property is the basis of the British practices, such as reforestation, care of young trees, Columbia’s annual property tax system. protection from fire and disease and sound BC Assessment is required to classify properties into harvesting methods. one of nine property classifications as outlined in the Class 8: Recreational Property, Non-profit Assessment Act: Organization — includes two very different Class 1: Residential — single-family residences, multi- categories: family residences, duplexes, apartments, Recreational Land condominiums, nursing homes, seasonal dwellings, - land used solely as an outdoor recreational manufactured homes, some vacant land, farm facility for specific activities such as golf, buildings and daycare facilities. skiing, tennis, public swimming pools, Class 2: Utilities — structures and land used for waterslides, amusement parks, marinas and railway transportation, pipelines, electrical hang gliding. Improvements on the land generation or transmission utilities, or (such as a clubhouse) fall into Class 6. telecommunications transmitters. This property class - land in a rural area that is part of parcel used does not include gathering pipelines, offices or sales for overnight commercial accommodation outlets. that exists predominantly to facilitate Class 3: Supportive Housing —this property class only specific outdoor recreational activities such includes eligible supportive housing property that has as hunting, fishing and kayaking. been designated by Cabinet. Eligible supportive Improvements on the land most likely fall housing property is funded by the provincial within Class 6 (e.g. a hotel). government or a health authority for the provision of Non-Profit Organization Land and housing that includes on-site support services for Improvements persons who were previously homeless, at risk of - property used or set aside for at least 150 homelessness, and who are affected by mental illness days per year as a place of public worship or or who are recovering from drug or alcohol addictions as a meeting hall by a non-profit, fraternal or have other barriers to housing. organization. The 150 days cannot include Class 4: Major Industry — land and improvements activities with paid admission or the (buildings and structures) of prescribed types of sale/consumption of alcohol. industrial plants, including lumber and pulp mills, - additionally, the 150 days needs to be in the mines, smelters, large manufacturers of specified year ending on June 30 of the calendar year products, ship building and loading terminals for sea- preceding the calendar year for which the going ships. assessment roll is being prepared. Class 5: Light Industry — property used or held for Class 9: Farm — to qualify as farm for assessment extracting, processing, manufacturing or transporting purposes, the land must produce a prescribed 23 | P a g e
amount of qualifying primary agricultural products for 9. Assessor responsible for assessments? The British sale, such as crops or livestock. Farm buildings come Columbia Assessment Authority (known as BC within Class 1. Assessment or BCA) is the government agency - Split Classification - Property with several responsible for completing the valuations. distinct uses can fall into more than one BC Assessment is a Crown Corporation, which reports class. For example, commercial and to a Ministry at the Provincial level (subnational). residential space might be combined in one BC Assessment has 6 Assessors who are responsible building, or a property combines residential, for 15 offices throughout the province. It is the farm and forestland. In these cases, BC Assessor’s responsibility to oversee their staff in the Assessment determines the share of the production of an annual assessment roll. value of the property attributable to each class. 10. Basis of valuation? The basis of taxation is “actual 3. Person tax legally imposed on? The owner has the value” as set out in S. 18 of the Assessment Act (RSBC responsibility to pay the taxes, but it is common that 1996) Chapter 20 and is defined as follows: these taxes are recaptured from the tenants in a "actual value" means the market value of the fee commercial leasing situation. simple interest in land and improvements. 4. Unit of assessment? The unit of taxable property is Some special purpose properties (e.g. the parcel owned. Telecommunications, Railways, Pipelines, Electrical However, under Sec 5 of the Assessment Act, the Power Generating Facilities) may be assessed using Assessor does have the authority to combine or sever Regulated Rates, or under legislated provisions (e.g. parcels in certain legislatively permissible Supportive Housing properties must be designated by circumstances. Cabinet, and value is set at $1 land, $1 improvements, for a total assessed value of $2). 5. Tax rate(s) set by? Property taxation is the main source of revenue for local governments. 11. Frequency of general revaluations? British Municipalities have authority under Part 7 of the Columbia has an annual reassessment cycle. Community Charter to tax property owners; this same 12. Date of last general revaluation? The revaluation authority does not apply to regional districts. is conducted each year and Assessment Notices are Instead, the Local Government Act provides the sent to owners on December 31 of the year preceding authority for regional districts to establish bylaws the assessment roll year (tax year). setting out maximum taxation amounts. 13. Valuation date used for current assessment The Province taxes property owners on the regional period? The values are based on the market districts' behalf and remits the revenue to the conditions July 1st of the year prior to the taxation regional district. year and property condition as of October 31st of the Tax rates differ between municipalities and may vary year prior to the tax year. depending on the "class" of property. Municipalities set their annual tax rates based on the 14. Main exemptions/reliefs? Every property owner revenue needs set out in their financial plan. in the province must pay property taxes unless specifically exempted by provincial statute. 6. Current tax rate? For most recent tax rates, see: Statutory exemptions are listed in both the http://www.cscd.gov.bc.ca/lgd/infra/statistics_index Community Charter and the Taxation Rural Area Act. .htm These properties include, but are not limited to: 7. Frequency of adjustment of tax rate(s)? Annually schools and universities; (by May 15). public libraries; 8. Tax collected by? Municipality/Taxing Authority or places of public worship; and, Surveyor of Taxes (Ministry of Finance) for rural hospitals. properties. Under the Community Charter and the Local Government Act, local governments may grant
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permissive tax exemptions which exempt certain The second level of appeal is to the Property properties from taxation for a specified period of Assessment Appeal Board ("PAAB" or the "Board"). time. Board members are appointed by Cabinet. Generally, public parks owned and held by an athletic The right of appeal is available to "any person" who is or service club, not-for-profit corporations, art dissatisfied with a decision of the PARP. galleries or museums owned by a charitable or If there is a disagreement with the PARP decision, an philanthropic organization and property owned by a appeal must be filed to the PAAB no later than 30th local authority receive permissive tax exemptions. April. For 2017, this deadline was extended to 1st Within BC, there are also a number of property tax May 1 as 30th April fell on a weekend. relief programs in place. The largest one being the A person affected by a PAAB decision may appeal to Homeowner grant program, which provides tax relief the BC Supreme Court, but only on a question of law. for primary residences that are valued at less than a Any further appeal to the BC Court of Appeal only certain value. Also available are tax deferment rests on a question of law where the Court of Appeal programs for seniors and families. grants leave. In respect of fees, no fee is payable for appeal to the 15. Initial appeal process? The first level of appeal is PARP. to file a “Notice of Complaint” (Appeal) to the For appeals to the PAAB, the fee is $30 per appeal. Property Assessment Review Panel (PARP). However, owners are encouraged to contact BC Assessment to 17. Property tax revenue vs. other revenue? Within discuss their assessment prior to filing an appeal. If a municipality, property tax is typically the largest the owner and BC Assessment agree to a change, an single source of revenue and on average accounts for amendment can be made without going to PARP. 46% of total municipal revenue. Provincially, total property taxation was 16. Independent body to determine unresolved approximately 9.1% of total taxation revenue. (Office appeals? Property Assessment Review Panel (PARP) of the Comptroller General Public Accounts 2016/17). hearings take place between 1st February and 15th March each year. 18. Any significant recent changes and important PARP members are members of the public appointed issues? There have not been any recent significant by the Minister responsible for BC Assessment, changes to the property tax system within BC since currently the Minister of Community, 2014. There are a number of issues that have Sport and Cultural Development. emerged. These include: At this level, the appeal is called a review or Housing affordability – On going market complaint. increases in the residential markets of the Any person is entitled to file a complaint about their province have dramatically reduced the own or another assessment on the grounds set out in affordability of housing. This has been most s. 32 of the Assessment Act and to have that notable within the Greater Vancouver assessment reviewed by a PARP. market but has started to spread to secondary markets within the province. The review process provides options to have property Attempts to address the affordability issue assessment concerns addressed. include the Province of BC creating a 15% If there are concerns about a property assessment, foreign buyers’ tax, the City of Vancouver they may be discussed with BC Assessment prior to adding a vacant homes tax and the Federal filing a complaint. Government of Canada introducing tougher If there is an agreement to make an amendment mortgage rules for purchasers. through this informal process, a recommendation can Increasing development land values impact be presented to the Panel. on existing business. There is an ongoing If taxes are paid to a First Nation taxing authority, the issue related to the property tax liabilities of assessment notice contains information regarding small business owners who have triple net assessment appeals as the provincial assessment leases. As development land values appeal system and deadlines may not apply. dramatically increase, small business owners 25 | P a g e
are facing significant increases in their is to express the tax rate as per $100 of assessment. property tax liability. These increases are All local governments tax non-domestic properties at enough to potentially drive the tax burden to 1.5 times the corresponding residential rate. higher than they can afford to pay. The demand for digital services – There is an 7. Frequency of adjustment of tax rate(s)? Tax rates ever-increasing demand for services in a are adjusted annually. digital format. 8. Tax collected by? Taxes are collected by the province and distributed to the appropriate New Brunswick municipalities and LSDs. 1. Title of Property Tax System? Municipal Property Tax 9. Assessor responsible for assessments? Valuation There are two levels of property taxation [provincial services are provided by the Assessment Division of and municipal/local] in New Brunswick. Service New Brunswick. Both the province and municipalities establish 10. Basis of valuation? Basis of market valuation is an separate tax rates within two property classes effective date of January 1 on each assessment and [residential and non-residential]. taxation year. All real property is valued at its “real 2. Type of property taxed along with brief and true value” essentially the same as “market description? All real property [land and buildings] is value”. assessed. 11. Frequency of general revaluations? Annually Municipal deed transfer tax is imposed on the sale of a property at the rate of 1% of the property value. 12. Date of last general revaluation? January 1, 2017 See Real Property Transfer Tax Act: 13. Valuation date used for current assessment http://laws.gnb.ca/en/ShowPdf/cs/R-2.1.pdf period? January 1, 2017 3. Person tax legally imposed on? The company or 14. Main exemptions/reliefs? Universities, non-profit individual in whose name the real property is low-rent housing, churches, cemeteries, ice rinks, assessed. provincial parks, historical and literary societies as See Section 21 Assessment Act: well as volunteer rural fire departments are all http://laws.gnb.ca/en/ShowPdf/cs/A-14.pdf exempt from taxation. 4. Unit of assessment? The property unit of Three sectors of transportation infrastructure [major assessment is real and true (market) value of the cargo ports, certified airports and rail right-of-way] entire property. along with crude oil tanks and associated pipelines See Section 15 Assessment Act: (connecting such tanks to the oil refinery) are http://laws.gnb.ca/en/ShowPdf/cs/A-14.pdf exempted from the Provincial Tax Levy, by legislation. Tax relief for deferral of tax on agricultural land and 5. Tax rate(s) set by? In New Brunswick there are two buildings is available. tax classifications these being residential and non- residential. The tax rate for each category is 15. Initial appeal process? The initial appeal may be established on an annual basis by the individual made by a “Request for Review of Assessment” municipality. The Province establishes the rates for directly to SNB at which point the assessor will review Local Service Districts (LSDs). The provincial the property details and either confirm or amend the government also applied to tax to cover cost of assessment. provincially provided services, such as roads. The tax 16. Independent body to determine unresolved is applied to properties including rental, industrial, appeals? A taxpayer who is not satisfied with the recreational, and commercial and homes in LSDs. assessor’s review may appeal to the New Brunswick 6. Current tax rate? Tax rates are applied to property Assessment and Planning Appeal Board [APAB]. assessment and (based on real and true market value) which can change from year to year. The convention 26 | P a g e
Any taxpayer not satisfied with the board ruling may Currently, 227 municipalities have imposed a real appeal to the Court of Queen’s Bench of New property tax and a business tax. Brunswick. 2. Type of property taxed along with brief 17. Property tax revenue vs. other revenue? For description? All real property [land and buildings] is 2016, total property taxation was approximately assessed. 26.9% of total taxation revenue. (New Brunswick Land transfer tax is not payable. However, a Consolidated Financial Statements 31 March 2017). registration fee equal to $100 plus 0.4% of the value of the property in excess of $500 is imposed by the 18. Any significant recent changes and important province. issues? A Freeze on Property Assessment was Municipalities may choose to adopt a business announced by Government for the 2018 taxation occupancy tax. The rate can vary by type of business year. and the taxes are set as a percentage of the The recent 2017 AG report, SNB Residential Property assessment of real property use either that business Assessment – Special Examination, identified 22 or as a percentage of the gross business of the recommendations for SNB to act upon in the delivery enterprise. This is in addition to the real property tax. of the assessment function in future years. SNB has Real property is classified for tax purposes as either accepted all of the recommendations and is in the commercial property, residential property or partly process of implementing an Action Plan to address one partly the other. the issues identified. Municipalities that do not adopt a market value base The AG recognized the current modernization operate under a poll tax system. strategy and overall vision was well intended, long overdue and the new technologies were in line with 3. Person tax legally imposed on? The company or accepted industry standards. It was clearly identified individual who owns the property is responsible for that SNB tried to implement change at a pace that the real property tax. was not attainable. The overall result was errors in The owner and the occupant are responsible for the property assessments due to the lack of quality proportional values and area occupied, if a business assurance mechanisms in place. tax is applicable. The AG recommendations concentrated in the 4. Unit of assessment? The property unit of following areas: project management, Fast Track, assessment is market value of the entire property. Methodology, errors, quality assurance and Business tax is a proportion. governance. 5. Tax rate(s) set by? The Municipal Assessment Newfoundland & Labrador Agency determines the values and assessment. The 1. Title of Property Tax System? Municipal Property municipality sets the mill rate to be used for the Tax. calculation of real property tax and business tax. Property assessment in Newfoundland is conducted 6. Current tax rate? Tax rates are applied to property by the Municipal Assessment Agency Inc. The City of assessment and (based on market value) which can St. John’s administers their assessment and tax change from year to year. The convention is to collection separately. express the tax rate as Mills or $1,000.00 of Property assessment is an elective tax at the assessment. See table below for 2017 rates for St municipal level. John’s.
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St John’s – Current Tax Rates 2017
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7. Frequency of adjustment of tax rate(s)? Annually councils have the authority to increase tax relief on an individual basis. 8. Tax collected by? Municipality 15. Initial appeal process? The initial appeal may be 9. Assessor responsible for assessments? The MAA is made directly to the Municipal Assessment Authority. a self-funding Crown Corporation whose sole purpose There is a filing fee associated with all appeals. The is to prepare real property assessments. fee is returned if the appeal is successfully reduced. 10. Basis of valuation? Basis of market valuation is 16. Independent body to determine unresolved “actual value” essentially the same as “market value”. appeals? A taxpayer who is not satisfied with the 11. Frequency of general revaluations? Properties assessor’s review may appeal to the Assessment are assessed on a three-year cycle. Review Commission. 12. Date of last general revaluation? January 1, 2016 Any taxpayer not satisfied with the ruling of the Assessment Review Commission may appeal to the 13. Valuation date used for current assessment Trial Division, Supreme Court of Newfoundland and period? The base date is the date that the values of Labrador. the properties in a Municipality are set for that particular assessment cycle. 17. Property tax revenue vs. other revenue? The The base date for all municipalities is January 1, 2014 amount of taxes collected by each municipality is or January 1 of every third year after 2014 (Definitions unknown. Assessment Act, 2006) 18. Any significant recent changes and important 14. Main exemptions/reliefs? Universities, churches, issues? None. cemeteries, productive farmland, designated with lots in the buildings associated with both. Municipal
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3. Person tax legally imposed on? The property Nova Scotia owner is liable for payment of taxes. 1. Title of Property Tax System? The mandate of the 4. Unit of assessment? The taxable property is the Property Valuation Services Corporation (PVSC) is to unit of ownership. value all properties in the province (ie. produce It is fee simple ownership in the same location for the property assessments), which informs Nova Scotia’s same use. municipal “property tax” system. 5. Tax rate(s) set by? Municipalities set tax rates. The 2. Type of property taxed along with brief province adds a fixed rate for common services. description? Real property is assessable. Assessable property is classified for taxation as taxable, exempt 6. Current tax rate? The tax rate varies by or partially exempt. Buildings and structures erected municipality. or placed upon, in, over, under or affixed to land, See table below for the 2017 tax rates and additions including buildings and structures under construction for all property classifications for Halifax, Nova Scotia. or partially constructed are assessable. Halifax Regional Municipality 2017 Tax Rates
Municipal Tax Rates All tax rates are per $100 of assessed value unless otherwise noted. Urban general rate Residential and Resource rate: $0.667 Commercial rate: $2.869 Services provided in this rate: policing, solid waste, recreation programs, planning, libraries, sports fields, playgrounds, administration, fire suppression, street lighting, recreational and community facilities (municipality’s share of capital and operating costs), sidewalks (including snow removal).
Suburban general rate Residential and Resource rate: $0.634 Commercial rate: $2.869 Services provided in this rate: policing, solid waste, recreation programs, planning, libraries, sports fields, playgrounds, administration, fire suppression, street lighting, recreational and community facilities (municipality’s share of capital and operating costs).
Supplementary education rate This rate applies to all tax areas and is in addition to the general rates above. The municipality provides supplementary funding to the Halifax Regional School Board (HRSB) and the Conseil Scolaire Acadien Provincial (CSAP), the province-wide Acadian school board. Under a four-year agreement with the school boards, there is now one uniform supplementary education tax rate across the municipality. Residential and Resource rate: $0.027 Commercial rate: $0.075
Fire protection: hydrants The Nova Scotia Utilities and Review Board (NSUARB) requires the municipality to make a contribution to fund the operations of the Halifax Water. This contribution is used to fund the hydrant costs incurred by Halifax Water and is set by a formula approved by the NSUARB. The hydrant charges are recovered via a special fire protection area rate that the municipality levies on all properties within 1,200 feet of a hydrant available for public fire protection. Check the fire protection area map [PDF] to see if this will apply to your property. Residential and Resource rate: $0.013 Commercial rate: $0.036
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Sidewalks Sheet Harbour & Area Streetscape Program - not applicable to Resource Residential and Resource rate: $11.84/property/pa Commercial rate: $11.84/property/pa
Transit services Transit taxes are arranged into two area rates. A “regional transportation rate” covers services such as the MetroLink, MetroX, and ferries. The cost for these regional services is shared by almost all taxpayers. Secondly, you pay a “local transit rate” if you live within one kilometre of a conventional or community transit stop. Refer to the regional and local transit maps below to see how your property is affected. Regional transportation Mapped area Residential and Resource rate: $0.048 Commercial rate: n/a Local transportation Mapped area Residential and Resource rate: $0.098 Commercial rate: n/a
Provincial rates Property valuation tax: the municipality shares some of the cost of the province's assessment system. Residential and Resource rate: $0.017 Commercial rate: $0.009
Correction services tax: all municipalities are required to make a mandatory contribution to the province to fund the cost of correctional services. Residential and Resource rate: $0.017 Commercial rate: $0.008
Metropolitan Housing Authority tax: the Metropolitan Housing Authority administers and manages public non-profit housing for seniors and families on low incomes within the municipality. Residential and Resource rate: $0.008 Commercial rate: $0.009
Mandatory Provincial Education Tax Contribution: Residential and Resource rate: $0.303 Commercial rate: $0.312
Total provincial rates Residential and Resource rate: $0.345 Commercial rate: $0.338
7. Frequency of adjustment of tax rate(s)? All tax • 6 elected municipal officials rates are reviewed annually. • 3 municipal administrators 8. Tax collected by? The municipality is responsible • 3 independent members for billing and collection of taxes. • Executive Director, Union of Nova Scotia Municipalities (UNSM) 9. Assessor responsible for assessments? PVSC is responsible for establishing the assessments and the 10. Basis of valuation? The basis of the tax is the open property classification. market value (assessed value) of the property at a PVSC is a not-for-profit organization managed by a specified valuation date. Board of Directors responsible for overseeing the strategic direction of the PVSC; comprised of 13 members: 31 | P a g e
11. Frequency of general revaluations? Revaluations In most cases, the property owner is the person who are annual and come into effect on January 1 each appeals the property assessment (appellant). Appeals year. can also be made on a property by anyone who owns property in the same municipality, including 12. Date of last general revaluation? January 1, 2017 corporations or the municipality itself but third-party 13. Valuation date used for current assessment appeals have special notice requirements. period? Reassessment values reflect a one-year lag. There is no fee to file an assessment appeal. For example, assessments effective January 1, 2017 The assessor, after review, is mandated to decrease, reflect the physical state and condition of the confirm or increase the appealed value; although an property as of December 1, 2016, and the value based increase is not common, on review it sometimes on market conditions as of January 1, 2016. happens. 14. Main exemptions/reliefs? The main exemptions 16. Independent body to determine unresolved are specified in the primary legislation; Section 5 of appeals? Where a property owner is not satisfied the Assessment Act. with the outcome of the appeal during the assessor The following properties are exempt from taxation: review stage, the next step is continuation with the • Property vested in Her Majesty for Imperial, Nova Scotia Assessment Appeal Tribunal (NSAAT). Dominion or Provincial purposes and used in an This independent third-party tribunal provides official capacity, but if occupied for other purpose, adjunction to resolve ongoing disputes. The Nova assessable and rateable; Scotia Assessment Appeal Tribunal has the authority • Places of worship; burial grounds; colleges, to consider and make a ruling on items such as: academy or other public institution of learning; a • Market Value hospital; public landings, breakwaters and wharves; • Classification (i.e. residential vs. commercial) • Municipality owned, occupied, operated or • Name of person assessed. managed for municipal purpose except if Municipal There is no fee payable for an appeal to the NSAAT. property used or managed for the producing, NSAAT has 60 days from the date of the hearing to transmitting, delivering or furnishing electricity, issue its decision. natural gas, water or power directly or indirectly then There is the possibility of a further appeal against the is taxable; decision of the NSAAT to the Nova Scotia Utility and • An agricultural society; Review Board (NSUARB). Appeals to NSUARB are • The Royal Canadian Legion, Army, Navy and Airforce heard de novo and are without cost. Veterans in Canada; 17. Property tax revenue vs. other revenue? Not • Any pack, troop, group, committee or district known. Property Tax is the main revenue source for council, regional council or provincial council for the municipalities. Boy Scouts or Girl Guides; • Property specially exempted from municipal 18. Any significant recent changes and important taxation by any Act of the Legislature. issues? PVSC has moved to a 1-year base date. Values • A main railway operating right-of-way and for the 2018 assessment roll are based on values as of operating spur lines, including land and structures January 1, 2017. associated with the right-of-way. Also, Municipalities are provided jurisdiction and Ontario discretion to provide relief via bylaw to charitable 1. Title of Property Tax System? There is one organizations performing certain good works. property tax system in Ontario, known as “property tax”. 15. Initial appeal process? An appeal can be made Approximately 5,000,000 residential and non- against a property assessment shown on the residential properties are assessed and taxed. assessment notice issued by PVSC. An appeal form is attached to the assessment notice.
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There is only one Assessment Authority for the entire The properties are divided into 38 classes/subclasses. province: The Municipal Property Assessment Ontario Regulation 282/98 - under the Assessment Corporation (MPAC). Act - determines these categories as follows: $2.4 Trillion total assessed value of properties in 1. Residential Ontario (2016 Assessment Update). 2. Residential farmland awaiting development, Phase 1 2. Type of property taxed along with brief 3. Residential farmland awaiting development, description? Only real property is assessed and taxed. Phase 2 Personal property is not subject to property taxation. 4. Resort condominiums Under sec. 3 (1) of the Act, all properties in Ontario 5. Multi-residential, occupied are subject to assessment and taxation, subject to 6. Multi-residential farmland awaiting specific exemption. development, Phase 1 7. Multi-residential farmland awaiting 3. Person tax legally imposed on? The owner is liable. development, Phase 2 In multi-tenanted properties, the owner is liable to 8. New multi-residential pay the tax; however, depending on the lease 9. Commercial, occupied arrangements, the owner will recover property tax 10. Commercial, excess land from the tenants. 11. Commercial, vacant land 12. Commercial farmland awaiting 4. Unit of assessment? All real property in Ontario (a development, Phase 1 legal parcel) is liable to assessment and taxation 13. Commercial farmland awaiting (section 3 of the Assessment Act), subject to various development, Phase 2 exemptions. 14. Office buildings 5. Tax rate(s) set by? Property tax has two 15. Office buildings, excess land components: a municipal portion and an education 16. Official buildings, vacant land 17. Shopping centres portion. 18. Shopping centres, excess land The rates for the municipal portion of the tax are 19. Shopping centres, vacant land established by each municipality. In a two-tiered 20. Parking lots and vacant land municipality, a component of the rate is set by the 21. Parking lots and vacant excess land upper-tier and a component is set by the lower-tier 22. Professional sports facilities municipality. 23. Professional sports facilities, excess land The rates for the education portion of the tax are 24. Professional sports facilities, vacant land established by the Minister of Finance and help to 25. Industrial, occupied fund the elementary and secondary education system 26. Industrial, excess land in Ontario. Education tax rates are set in Ontario 27. Industrial, vacant land Regulation 400/98 under the Education Act, and are 28. Industrial farmland awaiting development, available: Phase 1 29. Industrial farmland awaiting development, https://www.ontario.ca/laws/regulation/980400 Phase 2 6. Current tax rate? All properties are assessed by 30. Large industrial MPAC at 100% of current value (market value) with 31. Large industrial, excess land the following exceptions: 32. Large industrial, vacant land Farmland - based on current use 33. Pipelines Managed forests - based on lower of a 34. Farmlands prescribed rate based on farmland values or 35. Managed forest market value 36. Railway rights of way Pipelines, hydro and rail corridors - based on 37. prescribed rates 38. Hydro rights of way
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The municipalities determine the tax rates See table below for the tax rates for City of Toronto. accordingly.
2017 Property Tax Rates City of Toronto (Extracted from City of Toronto website)
Your final 2017 property taxes consist of a City levy, education levy and City Building fund levy.
Residential Properties
The City levy has been calculated by multiplying your property's 2017 phased-in assessment by the City's tax rate, as approved by Toronto City Council.
The education levy is calculated by multiplying your 2017 phased-in assessment by the education tax rate, as set by the Province of Ontario.
The City Building fund is calculated by multiplying your 2017 phased-in assessment by the City Building fund levy, as approved by Toronto City Council.
Multi-Residential, Commercial and Industrial Properties
Properties that are subject to a tax increase will continue to be protected by capping.
City Council has approved changes in the calculation of property taxes for non-residential properties to accelerate progress towards full Current Value Assessment (CVA) levels of taxation. Starting in 2017, the maximum allowable tax increase (tax cap amount) will be calculated based on 10 per cent of the property's full 2016 CVA taxes. Additionally, where a property's 2017 actual CVA taxes in comparison to the 2016 annualized taxes are within $500, the property will move directly to full 2017 CVA taxes.
Properties with tax decreases will continue to have a portion of their tax decrease withheld to fund the cap on properties subject to increases.
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7. Frequency of adjustment of tax rate(s)? It is 13. Valuation date used for current assessment reviewed/changed annually. period? For the Assessment cycle of 2017, 2018, 2019 and 2020 taxation years, land is valued as of January 8. Tax collected by? The municipality levies and 1, 2016. collects the tax. They prepare the bills and send out them out to taxpayers. 14. Main exemptions/reliefs? Certain property is The provincial government provided a standardised exempt from taxation under section 3 of the Act. property tax bill for municipalities to use in order to The exemptions include: enable taxpayers with more than one property to a) Crown lands more easily understand bills and compare them on a b) Cemeteries, burial sites consistent basis. c) Churches 9. Assessor responsible for assessments? Valuation d) Public education institutions assessments are provided by the Municipal Property e) Philanthropic organizations Assessment Corporation (MPAC), which is a central f) Public hospitals agency dealing with all properties situated in the g) Non-Profit Long-Term Care homes province. h) Highways i) Municipal property 10. Basis of valuation? The basis of the tax is the j) Boy Scouts and Girl Guides “current value” of the property (i.e. land and k) House of refuge buildings); “current value” is taken to be the same as l) Charitable institutes “market value”. m) Children’s aid societies Section 19 of the Act defines it as follows: “The n) Scientific or literary institutions amount of money the fee simple, if unencumbered would realize if sold at arm’s length be a willing seller o) Battle sites to a willing buyer.” p) Machinery: All machinery and equipment used for manufacturing or farming purposes 11. Frequency of general revaluations? All properties q) Machinery used for producing electric power in Ontario are revalued every four years. r) Amusement rides 12. Date of last general revaluation? 2017 is a s) Conservation land reassessment year and the beginning of the new 4- t) Small theatres year revaluation cycle. u) Hydro-electric generating stations
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v) Poles and wires Quebec w) Non-Profit Hospices 1. Title of Property Tax System? The tax is referred to as “property tax” and is governed by the Revised 15. Initial appeal process? An appeal to the Statutes of Quebec (RSQ) Chapter F-2.1 The Act Assessment Review Board (ARB) can be filed annually Respecting Municipal Taxation, known as the “Act”, by the owner (sec. 40 of the Act) or an agent. Tenants or CQLR c F-2.1. may also appeal as long as their lease clauses allow The municipal assessment roll serves both the them to appeal. municipality and local school commission. For residential properties there is a mandatory “Request for Reconsideration”. 2. Type of property taxed along with brief If a property or a portion of it is classified as description? An “immovable” is the type of property Residential, Farm, Managed Forest or Conservation subject to property taxation. Land you MUST file a Request for Reconsideration “Immovable” is defined in the Act as: (RfR) with the Municipal Property Assessment • An immovable within the meaning of Article 900 of Corporation (MPAC). A decision must be received the Civil Code of Québec; and before filing an appeal with the ARB. The appeal must • A movable that is permanently attached to an be filed before the deadline, which is 90 days from the immovable. mailing date on the RfR decision. The fee to file a 3. Person tax legally imposed on? The owner is liable complaint at the ARB is $125.00; a $10 discount is for the payment of property tax, and the name of the applied if you file directly through the ARB website. owner is entered into the assessment roll. For other property types, you may choose to either In Section 1 of the Act, the owner is defined as the file a RFR with MPAC or file an appeal directly with the person who holds the right of ownership of the Board. If you do not file a RfR, your deadline to file immovable, including the emphyteutic lessee and the directly with the ARB is March 31 for annual occupant of the domain of the state. assessment appeals or 90 days from the notice date for other types of assessments. 4. Unit of assessment? Under Section 34 of the Act, There is a non-refundable appeal fee charged in the the unit of assessment consists of the greatest amount of $300.00 per roll number for Commercial, possible aggregate of immovables which: Industrial, Multi-Residential Properties and Other • are owned by the same owner or group of owners Properties (Receive a $10 discount if you E-File). in undivided ownership; • are contiguous, or would be but for a watercourse, 16. Independent body to determine unresolved thoroughfare or communications network; appeals? The Assessment Review Board (ARB) is an • if used, are used for a single primary purpose; and independent tribunal regulated by The Environment • can normally, and in the short term, be transferred and Land Tribunals Ontario (ELTO). only as one whole, and not in parts, taking into 17. Property tax revenue vs. other revenue? account the most probable use. Approximately 70% of revenue is raised from 5. Tax rate(s) set by? Set yearly by municipalities and property taxation and user charges (licences). The school commissions. Province provides the other 30% via various provincial The tax rates vary by municipality (and Boroughs grants. within the municipality) and by categories of 18. Any significant recent changes and important immovables. Section 244 of the Act gives six issues? The Ontario system is stable and property categories of immovables: taxes are fairly predictable. • non-residential immovables; There are a number of issues concerning the property • industrial immovables; tax system in Ontario, including the use of capping • immovables consisting of six or more dwellings; and clawback mechanisms. • serviced vacant land; • agricultural immovables; and • the residual category (used for residential). 36 | P a g e
6. Current tax rate? The tax rate varies widely by rate is always the non-residential rate which applies municipalities and school commissions; the highest to commercial properties. (See table below).
7. Frequency of adjustment of tax rate(s)? Annually. Under Sec. 22 of the Act, the assessor is required to be a member of the Ordre Professionnel des 8. Tax collected by? Municipalities and school Evaluateurs Agréés du Québec. commissions. 10. Basis of valuation? The basis of the tax is Actual 9. Assessor responsible for assessments? The Value which is defined in Section 43 of the Act. valuations are carried out by the assessor for the Actual Value is effectively the exchange value of the municipality. immovable in the free and open market, i.e. the price In accordance with the Act, every municipality is most likely to be paid at a sale by agreement between required to appoint an assessor. In the case of a willing seller and a willing buyer who are reasonably regional municipalities, there is one assessment informed of the condition of the unit of assessment, authority. the use that can most likely be made of it and of property market conditions.
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11. Frequency of general revaluations? The assessor Section 204 of the Act refers to immovables entered files triennial rolls, i.e. there is reassessment every onto the roll but exempt from all municipal or school three years (Section 14). The Minister can extend this taxes by way of occupation: period. by the Crown, State, or local municipality; Section 36.1 of the legislation requires that the by religious institutions; assessor must check the accuracy of the data in his by agricultural or horticultural societies; or possession at least every nine years. for educational purposes. 12. Date of last general revaluation? It varies by 15. Initial appeal process? Application for municipality. For example, the latest triennial Administrative Review can be filed with the assessment rolls for the Agglomeration of Montreal assessment authority (before May 1st of the first year were deposited on September 14, 2016 and were of coming into force of a new triennial roll). effective as of January 1, 2017. 16. Independent body to determine unresolved 13. Valuation date used for current assessment appeals? Any person who has filed an application for period? The date of valuation is July 1 of the second review and who has not entered into an agreement fiscal year preceding the first of the fiscal years for with the assessor may lodge an appeal with the which the roll is made. Immovable Property Division of the Administrative Therefore, the values entered on the rolls for Tribunal of Québec (TAQ), which is an independent Montreal reflect the market conditions as of July 1, tribunal which also deals with appeals on social 2015, and are the basis for the 2017, 2018 and 2019 affairs, the territory and environment and economic tax bills. affairs. The condition of the unit of assessment (which 17. Property tax revenue vs. other revenue? includes its physical, economic and legal condition); Property tax revenue forms 70-75% of municipal tax the state of the physical surroundings; the property revenues. market conditions; and the most likely use made of the unit; are all taken as at the valuation date. 18. Any significant recent changes and important issues? Nothing of substance. 14. Main exemptions/reliefs? Sections 63-68 of the Act refers to immovables which are not to be entered Saskatchewan into the assessment roll; they include: 1. Title of Property Tax System? It is the Property public roads, waterworks, sewerage systems, Assessment and Taxation System. plant for water or garbage treatment, a mass There are three main pieces of provincial legislation transit network system, the structural members that speak to the assessment of property for of wharves or port facilities – where these are municipal assessment and taxation purposes; The owned, administered or managed by a public body; Municipalities Act, The Cities Act, The Northern industrial machines or apparatus and their Municipalities Act, 2010. accessories (other than oil refineries) for All have identical assessment and taxation legislation. industrial production or agricultural operations; For discussion purposes, The Municipalities Act (M anti-pollution machinery linked to industrial Act) will be used for legislative references. production; 2. Type of property taxed along with brief mineral deposits; description? Pursuant to provincial legislation, real railways; property is assessable. This includes land, buildings gas distribution systems; and resource production equipment (RPE) such as telecommunications systems; and mine or oil and gas equipment used to extract a immovables relating to electrical production, transmission or distribution. mineral or resource to the surface. The rules governing property assessment are set out in provincial legislation and in the regulated
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Saskatchewan Assessment Manual, which is The municipal assessor is an employee of the approved by Order of the Minister of Government municipality who is responsible for administering the Relations and has the force of law. assessment roll. 3. Person tax legally imposed on? Typically, it is the 10. Basis of valuation? There are two main valuation owner of the property. standards set out in provincial legislation that In some cases, such as government owned property determine the basis of valuation. and railway station ground leases, the tenant would The market valuation standard pertains to the be deemed liable for the taxes. valuation of residential and non-regulated commercial property. This standard provides 4. Unit of assessment? Assessments are prepared for flexibility in determining the assessed value of individual properties on a parcel level, which is property by allowing the use of the three accepted typically the ISC (land titles) parcel level. Multiple approaches to value employed in the industry: the parcels owned by the same owner may be grouped by cost approach, the sales comparison approach, and the assessor on the assessment roll. Assessment the income approach. information at the property level. The regulated property assessment valuation 5. Tax rate(s) set by? Individual municipalities standard relates to for the valuation of farm land, establish their own municipal mill rates and apply heavy industrial property, pipeline, railway, roadway available tax tools. Tax tools and mill rate information and resource production equipment for mines/oil/gas can be found on the Ministry of Government sites. This standard is achieved by following the Relations website: procedures and rates set out in the regulated http://www.saskatchewan.ca/residents/taxes-and- provincial assessment manual. investments/property-taxes Both the market valuation standard and the regulated The Provincial government sets the education mill property assessment valuation standard must adhere rates which are 1.43 for agricultural property, 4.12 for to the base date, and equity must be considered by residential property, 6.27 for commercial/industrial the appraiser as a dominant and controlling factor in property and 9.68 for resource property (mines, oil assessment preparation. and gas, pipelines). 11. Frequency of general revaluations? 6. Current tax rate? The Provincial government sets Saskatchewan has a four-year revaluation cycle. the education mill rates which are 1.43 for Legislation requires that all properties in agricultural property, 4.12 for residential property, Saskatchewan be revalued once every four years to 6.27 for commercial/industrial property and 9.68 for reflect a new base date level of value. resource property (mines, oil and gas, pipelines). 12. Date of last general revaluation? The current 7. Frequency of adjustment of tax rate(s)? Mill rates revaluation was implemented in 2017. This are reviewed on an annual basis. revaluation cycle will remain in place from 2017 until 8. Tax collected by? The municipality administers the 2020. The next revaluation will occur in 2021 and will tax collection process for both municipal and school remain in place until 2024. Additional information taxes. The school taxes are then remitted to can be found on SAMA’s website at: provincial government who then allocate the http://sama.sk.ca/html/3/revaluations.html amounts to the school boards. 13. Valuation date used for current assessment 9. Assessor responsible for assessments? period? For the 2017 revaluation, the base date or Saskatchewan has licensing requirements for effective date of valuation used for determining undertaking property assessments. A licensed assessed values is January 1, 2015. Property assessment appraiser is the qualified individual that is assessments are to reflect economic conditions as of responsible for undertaking valuations and prepares this date. the assessments on behalf of the municipal assessor.
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14. Main exemptions/reliefs? Property tax Residential POV were increased from 70 to 80 per exemptions are specified in sections 292-298 of the M cent to partially mitigate an expected tax shift onto Act. Types of exemptions include church and school commercial properties in urban centers that would exemptions, government exemptions, farm use have been unfair. building tax exemptions, and an exemption for new All other POV remain the same for 2017 as they were economic development (section 298(5)). for 2013. In terms of assessment related issues, there has been 15. Initial appeal process? The first level of appeal in a general decrease in market values since the base Saskatchewan is the local Board of Revision (BoR). date. This coupled with increases in the POV for Property owners have the opportunity to appeal residential and non-arable farm land, and general every year. Municipalities provide public notice when increases in taxation levels, has led to an increase in the assessment roll is open for inspection and appeal. assessment appeals (relative to the first year in the In a non-revaluation year, you have 30 days to launch previous revaluation cycle (2013) when property an appeal. In a revaluation year, you have 60 days to values were still increasing). With that said, total appeal. appeal levels are still below 1% of assessable The Ministry of Government Relations has additional properties. materials regarding the appeal process on their website at: http://www.saskatchewan.ca/residents/taxes-and- HONG KONG investments/property-taxes/appeal-your-property- 1. Title of Property Tax System? Property Tax is assessment known as Rates in the Hong Kong Special Administrative Region (HKSAR). It used to be called 16. Independent body to determine unresolved “Police Rate” with its historical origin of meeting the appeals? The second level of appeal is the expenses for upholding and maintaining the police Assessment Appeals Committee of Saskatchewan force. Rates are a tax on the occupation of property Municipal Board as per sections 243-257 of the M Act. and are charged at a percentage of the rateable value Appeals can be made to the Saskatchewan Court of of property. Properties in all parts of the HKSAR are Appeal on questions of law. liable to the assessment of rates. For the 2017-18 17. Property tax revenue vs. other revenue? This Valuation List, there are approximately 3.21 million information is not available at this time. domestic and non-domestic properties, forming 2.48 18. Any significant recent changes and important million assessments. issues? 2017 was a revaluation year in Saskatchewan. 2. Type of property taxed along with brief In terms of taxation related issues, The Government description? Rates are charged on real property only. of Saskatchewan made amendments to the Generally, properties in all parts of HKSAR are liable percentages of value (POV) for the 2017 taxation to the assessment of rates under the Rating year. Ordinance (Cap. 116) (the Ordinance). POV are used to calculate taxable assessments from 3. Person tax legally imposed on? Both the owner assessed values calculated by assessment appraisers. and the occupier are liable for rates. Taxable assessments are then multiplied by the mill In practice, this will depend on the terms of the rate, established by municipalities for the municipal agreement between the owner and occupier of the portion and the province for the education portion, to property. determine property tax. In the absence of any agreement to the contrary, Changes to POV shift tax among property classes. liability of rates rests with the occupier. For 2017, the government adjusted the POV for non- arable (pasture) land from 40 to 45 per cent. This 4. Unit of assessment? The unit of assessment for provided some relief to cultivated agricultural rating purposes is a “tenement”, defined in the properties. Ordinance as “any land (including land covered with water) or any building, structure, or part thereof 40 | P a g e
which is held or occupied as a distinct or separate 12. Date of last general revaluation? The last general tenancy or holding or under any licence”. revaluation exercise started in 2016 with the new rateable values taking effect on 1 April 2017 for the 5. Tax rate(s) set by? The charging rate is prescribed financial year 2017-18. annually by resolution of the Legislative Council. 13. Valuation date used for current assessment 6. Current tax rate? For the Financial Year 2017-2018, period? 1 October 2016 is specified as the valuation the rates percentage charge is 5%. date of the 2017/18 General Revaluation. 7. Frequency of adjustment of tax rate(s)? The rates 14. Main exemptions/reliefs? I. Exemption percentage charge is prescribed annually and has Section 36 of the Ordinance deals with exemptions. been maintained at 5% since 1999. Exemption from liability for rates takes two forms: 8. Tax collected by? Rates are collected by the Rating (i) Exemption from assessment to rates - tenement & Valuation Department (RVD) of the HKSAR will not appear in the valuation list Government. The revenue forms part of the general Section 36(1) covers 12 categories of eligible revenue of the HKSAR Government (the properties which include, in the main, agricultural Government). properties, village houses inside some designated 9. Assessor responsible for assessments? The area in the rural part of the territory, properties assessments are carried out by the Commissioner of owned and occupied by Government, cemeteries, Rating and Valuation (the Commissioner). properties built and occupied for public religious worship purposes, and those for which the rateable 10. Basis of valuation? Under Section 7(2) of the values do not exceed a prescribed amount. Ordinance, the rateable value of property is an (ii) Exemption from payment of rates under Section estimate of its annual open market rental value at a 36(2) and (3) - tenement is included in the valuation designated valuation reference date assuming that list but liability to pay rates is exempted by the property was then vacant and to let, and that the administrative means. For example, consular tenant undertakes to pay all usual tenant’s rates while premises and residences of accredited consular the landlord would pay the Government rent and all officers, adapted premises occupied for public expenses necessary to maintain the property. religious worship and leased premises occupied by Sections 7A(2) and (3) set out the other assumptions Government are exempted from payment. in relation to the mode or character of occupation II. Water Concession and the physical environment that an assessor needs Where there is no supply of fresh water from a to make when preparing valuation for rating Government water-main or the Government supply is purposes. Neither restriction on sale nor on letting unfiltered, the amount of rates payable will be will be taken into account by the assessor. reduced by 15% and 7.5% respectively. III. Rates Concession 11. Frequency of general revaluations? The As a relief measure, rates concession is given to all frequency of general revaluations in Hong Kong is not ratepayers to offset the rates payable in the financial specified in the Ordinance. year 2017-2018, subject to a ceiling of HK$1,000 per Under Section 11 of the Ordinance, the Chief quarter for each rateable tenement. Executive of the HKSAR may at any time direct the Commissioner to prepare a new list of rateable 15. Initial appeal process? values, and at the same time designate a date by (i) Proposals reference to which the rateable values of the Following a general revaluation, a new valuation list is tenements shall be ascertained for the purpose of declared by the Commissioner in March and made that revaluation. available for public inspection until end of May in that Since 1999, general revaluations have been year. The new rateable values take effect on 1 April conducted on an annual basis. of the year.
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The Ordinance provides for any person who is 18. Any significant recent changes and important aggrieved by an entry in the valuation list to serve a issues? The rating system does not appear to be an proposal in the specified form on the Commissioner issue in HKSAR. for alteration of the valuation list and empowers the We have regular revaluations (annual) to redistribute Commissioner to accept proposals served on him tax burden in accordance with prevailing market rent after the declaration of the list in March and before 1 of properties and the charging rate (5% of rateable June in the same year. value since 1999) is relatively low. Upon receiving a valid proposal, the Commissioner will review the assessment and issue a notice of IRELAND decision to the proposer no later than 30 November 1. Title of Property Tax System? There are two forms immediately following the making of the proposal as of property tax in Ireland: required by the Ordinance or within such other time (1) Local Authority Rates [LAR] applies to about as the Chief Executive of the HKSAR may direct. 170,000 non-domestic, business and industrial (ii) Objections properties. Whenever the Commissioner serves a notice of an (2) Local Property Tax [LPT] was introduced in Ireland amendment to a valuation list by an interim valuation with the passing of the Finance (Local Property Tax) (An interim valuation is made whenever it is Act 2012 on 26 December 2012 and took effect for necessary to assess a new tenement or any tenement, the year 2013. The Act was subsequently amended on which is not already included in the valuation list.), an 13 March 2013 and is now the Finance (Local Property aggrieved owner or occupier may, within 28 days, Tax) Act 2012 (as amended). serve on the Commissioner a notice of objection. LPT is charged on annual basis. It is payable by the The Commissioner is required to issue his decision on person who is the liable person in relation to the objection within six months after the expiration of residential property on a specified date in each year the 28-day statutory objection period setting out (known as the ‘liability date’) and is based on the self- whether the interim valuation shall be confirmed, assessed market value of a property on a specified varied or set aside. date in a 3-year valuation period (known as the 16. Independent body to determine unresolved ‘valuation date’) LPT applies to approximately 1.9m appeals? A person who is dissatisfied with the residential properties in the State. Commissioner’s decision in respect of a proposal or 2. Type of property taxed along with brief an objection may appeal to the Hong Kong Lands description? 1) Subject to legally specified Tribunal (the Tribunal). exceptions, LAR applies to commercial and industrial The appeal must be lodged with the Tribunal within properties, including real property and certain 28 days of service of the notice of decision. prescribed rights and easements over property. The decision of the Tribunal is final on issues of (2) LPT applies to all residential properties in the State valuation and findings of fact. which are in use as, or which are suitable for use as, a Further appeals can only be made on points of law to dwelling. A property that is occupied as a dwelling is the Court of Appeal and then to the Court of Final chargeable regardless of the state of repair of the Appeal. property. A property that is not occupied is also 17. Property tax revenue vs. other revenue? In the chargeable as long as it is suitable for use as a financial year 2016-17, the revenue from rates was dwelling, i.e. it has been completed or is not in such a HK$21.3 billion which represented 3.7% of all bad state of repair that it is not capable of being government revenue in HKSAR. occupied. LPT applies to both privately-owned and Source: Table 193 of “Hong Kong Statistics”, Census State-owned residential properties. and Statistics Department of the Government, https://www.censtatd.gov.hk 3. Person tax legally imposed on? (1) LAR: The occupier of the property is liable. Where the property
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is vacant, the owner/immediate lessor of the 5. Tax rate(s) set by? (1) LAR: The tax rate, known as property is liable. Annual Rate on Valuation (ARV), is set annually by the (2) LPT: For the most part, the liable person is the particular rating authority (Local Authority) in which owner of the property, regardless of whether he or the property is located. she lives in the State or not. In certain circumstances, (2) LPT: The basic tax rates of 0.18% and 0.25% are set the owner of a property is displaced as the liable by central government. From 1 January 2015, each person by other categories of person such as: local authority has had the ability to increase or • A landlord who has let the property under a lease of decrease the basic tax rates by up to 15% (known as less than 20 years the local adjustment factor) on properties situated • A tenant who has leased the property under a lease within its functional area. of at least 20 years. 6. Current tax rate? 1) LAR: Setting the ARV is a • Persons with a long term right of residence who are reserved function of each rating authority. entitled to exclude any other person from the Accordingly, the rate varies from local authority to property. local authority. Examples for 2017 include: • Holders of a life interest in the property. Rating Authority ARV for 2013 • Personal representatives of a deceased owner. Dun Laoghaire- 0.1648 • Trustees where the property is held in trust. Rathdown 4. Unit of assessment? (1) LAR: The unit of South Dublin 0.1620 assessment is the unit of occupation and is known as Fingal 0.1440 the “relevant property” [s17 of the Valuation The amount of LAR payable by a ratepayer is (Amendment) Act 2015]. Following the enactment of calculated by multiplying the NAV determined by the the Valuation Act, 2001 the term ‘relevant property’ Valuation Office by the ARV set annually by the rating replaced ‘rateable hereditament’ or tenement. The authority (Local Authority). valuation assessment is known as “rateable (2) LPT: There are two rates of 0.18% and 0.25%, valuation”. This is based on the national Valuation depending on the value of the property. The rate of Office estimating the “Net Annual Value” (NAV) of 0.18% is applied to properties valued at up to €1m. each rateable property and the NAVs are published in The amount of LPT due is established by reference to a “valuation list”. There are currently 31 rating valuation bands in that the rate is applied to the mid- authorities each of which has its own valuation list. A point of the relevant valuation band. number of public utility valuations are valued globally Valuation Valuation Midpoint LPT and entered on a ‘Central Valuation list’ which also Band Band € of from shows the amount of each global valuation Number Valuation 2014 € apportioned to individual rating authorities. Band € (full year (2) LPT: The unit of assessment is each chargeable charge) residential property. This is any building or structure 01 0 to 50,000 90 (or part of a building or structure) which is used as, or 100,000 is suitable for use as, a dwelling. It also includes any 02 100,001 to 125,000 225 ancillary buildings and structures such as sheds, 150,000 outhouses and, garages and any ancillary land, such 03 150,001 to 175,000 315 as yards and gardens, of up to 0.4047 hectares 200,000 (equivalent to one acre). Because a residential 04 200,001 to 225,000 405 property includes part of a building, individual 250,000 apartments in an apartment block are a separate unit 05 250,001 to 275,000 495 of assessment. However, a building that contains 300,000 accommodation units such as bedsits or granny flats 07 300,001 to 325,000 585 that are not capable of being sold independently is 350,000 treated as a single unit of assessment.
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08 350,001 to 375,000 675 Cavan County 400,000 Nil Nil Council 09 400,001 to 425,000 765 450,000 Clare County Nil Nil 10 450,001 to 475,000 855 Council 500,000 11 500,001 to 525,000 945 Cork City Council Nil Nil 550,000 12 550,001 to 575,000 1,035 Cork County Nil Nil 600,000 Council 13 600,001 to 625,000 1,125 650,000 Dun Laoghaire 14 650,001 to 675,000 1,215 Down Rathdown County Down 15% 700,000 15% Council 15 700,001 to 725,000 1,305 750,000 Donegal County 16 750,001 to 775,000 1,395 Nil Nil 800,000 Council 17 800,001 to 825,000 1,485 Dublin City Down Down 15% 850,000 Council 15% 18 850,001 to 875,000 1,575 Fingal County Down 900,000 Down 15% 19 900,001 to 925,000 1,665 Council 10% 950,000 Galway City 20 950,001 to 975,000 1,755 Nil Nil Council 1,000,000 Properties valued at over €1m are assessed on their Galway Council Up 10% Nil actual value with a rate of 0.18% applied to the first €1m and 0.25% applied to the remainder. Kerry County Nil Up 5% 7. Frequency of adjustment of tax rate(s)? (1) LAR: Council Tax rate (ARV) is set annually by the rating authority Kildare County (Local Authority). It is a reserved function of the Nil Nil Council elected members of that rating authority. (2) LPT: From 1 January 2015 each local authority has Kilkenny County Nil Nil had the ability to increase or decrease the basic rates Council (0.18% or 0.25%) by up to 15% in each year. The table below shows the rates applied by local Laois County Nil Up 10% authorities for 2017 and 2018: Council
Leitrim County 2017 2018 Nil Nil Council (Variation Local Authority (Variation from from 2014 rate) 2014 Limerick City & Up 10% Up 7.5% rate) County Council Carlow County Nil Nil Longford County Council Down 3% Up 5% Council
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(2) LPT: There is no central assessor that is responsible Louth County Nil Nil Council for assessments. LPT is a self-assessed tax, i.e. the liable person himself or herself determines the value Mayo County of his or her property and determines the amount of Nil Nil Council LPT payable by reference to the valuation bands at 6 above, or the actual value in the case of properties Meath County Nil Nil valued at >€1m. Council 10. Basis of valuation? (1) LAR: The basis of valuation Monaghan is known as “Net Annual Value” (NAV). This is defined Nil Nil County Council in legislation and equates to the annual rental value, subject to a number of statutory assumptions. The Offaly County Nil Nil relevant legislation is the Valuation Act 2001 as Council amended by the Valuation (Amendment) Act 2015. (2) LPT: The basis of valuation is the price that a Roscommon Nil Nil property would be expected to sell for in the open County Council market as established by the liable person on a specified date (known as the ‘valuation date’). The Sligo County Nil Nil Council valuation date for the valuation period, covering 1 July 2013 to 31 December 2019, is 1 May 2013. Thereafter, the valuation date will be 1 November in South Dublin Down Down 15% the year preceding each valuation period, i.e. 1 County Council 15% November 2019 for the valuation period commencing 1 January 2020. The open market sales price is Tipperary County Nil Up 10% hypothetical in the sense that that any actual Council restrictions on the sale of the encumbered fee simple of a property cannot be taken into account. Waterford City & Nil Up 2.5% 11. Frequency of general revaluations? (1) LAR: County Council National revaluation programme currently underway on a rolling basis; each rating authority is re-valued Westmeath Nil Nil independently of other rating authorities. Thereafter, County Council revaluations will occur not less than five years and not more than ten years later. Wexford County Up 5% Up 10% Council (2) LPT – A valuation submitted by a liable person for the first valuation date of 1 May 2013 will remain in Wicklow County place for the valuation period 1 July 2013 to 31 Nil Nil Council December 2019. Thereafter, revaluations will be submitted by the next valuation date, 1 November
2019, for the period commencing 1 January 2020. 8. Tax collected by? (1) LAR: Collected by each individual rating authority (Local Authority). 12. Date of last general revaluation? (1) LAR: The last (2) LPT: Collected by the Office of the Revenue revaluation took place in 2017 for the following local Commissioners, Dublin Castle, Dublin 2, Ireland on authorities – Carlow, Kilkenny, South Dublin, Kildare, behalf of central government. Leitrim, Longford, Offaly, Roscommon, Sligo and Westmeath County Councils. 9. Assessor responsible for assessments? (1) LAR: On 6th October 2017, Valuation Orders, which set in Assessments are conducted by the Valuation Office, train the process for the revaluation of all commercial the State organisation responsible for conducting and industrial property, were signed by the such assessments. 45 | P a g e
Commissioner of Valuation for revaluation 2019 in Rate relief is available in respect of qualifying vacant the following local authorities – Cavan, Fingal, Louth, properties. Meath, Monaghan, Tipperary, Wexford and Wicklow (2) LPT: The following residential properties are County Councils. exempt from LPT: (2) LPT: 1 May 2013 [also first year of valuation] • Properties constructed and owned by a builder or a property developer that are treated as trading stock 13. Valuation date used for current assessment for income tax purposes, that remain unsold and that period? (1) LAR: The valuation date is set by statutory have not yet been used as a residence. order as the revaluation of each rating authority takes • New and previously unused properties that are place. It precedes the date of the order. For those purchased from a builder or a property developer authorities subject to revaluation in 2017, the between 1 January 2013 and 31 October 2019 are valuation date is 30th October 2015. exempt until 2020. (2) LPT: The first valuation date is 1 May 2013 for the • Properties purchased or built between 1 January period 1 July 2013 to 31 December 2019. 2013 and 31 December 2013 and occupied as the 14. Main exemptions/reliefs? (1) LAR: Various classes occupiers sole or main residence are exempt until of non-rateable property are set out in legislation. 2019. This exemption is not limited to first-time These include: buyers. agricultural land, land developed for • Properties in specified unfinished (‘ghost’) housing horticulture, forestry or sport; estates. farm buildings; • Properties owned by a charity or a public body and domestic properties; used to provide accommodation and support for properties used exclusively for public people with special needs. worship; • Registered nursing homes. not for profit care homes and hospitals; • Properties that have been vacated by individuals not for profit schools, colleges and who cannot continue to live there because of a long universities; term mental or physical infirmity, provided that the any not for profit gallery, museum, library, property remains vacant. parks or national monuments open to the • Mobile homes, vehicles or vessels and other public; lighthouses, community halls and certain properties/structures that are not permanently properties occupied by charitable attached to the ground. organisations. • Properties fully subject to commercial rates. Local authorities can grant discretionary relief in • Properties that have a tax exemption under the some cases. Vienna Conventions of 1921 (Diplomatic Relations) At present, there is no “transitional relief” available to and 1923 (Consular Relations). phase in the impact of revaluation, however the • Properties that have been certified by a competent purpose of revaluation is to redistribute the person such as an engineer as having a significant commercial rates liability more equitable between level of pyrite-induced damage have a temporary ratepayers rather than to increase the total amount exemption of approximately six years. of commercial rates collected by a local authority. For • Properties used by charitable bodies as residential this reason, under the Valuation Act 2001 (as accommodation in connection with recreational amended) the rates income of the local authority is activities that are an integral part of the body’s capped in the year following a revaluation. Any charitable purpose, e.g. guiding and scouting increase will be limited to the rate of inflation. activities. The Annual Rate on Valuation (ARV) is applied to all • Properties purchased, built or adapted because of rateable properties in a rating authority area; smaller their suitability for, or to make them suitable for, business properties are not treated differently to occupation by permanently and totally incapacitated larger business properties. individuals as their sole or main residence. The chargeable value of a property that has been adapted 46 | P a g e
to make it suitable for occupation by a disabled Revisions individual may be reduced by the amount of the value An occupier of a property (or a rating authority or that is attributable to the adaptation work where the owner) can make a request for a “revision” of the adaptation work has had the effect of moving the entry in the valuation list [Part 6 of the 2015 Act]. chargeable value of the adapted property into a A fee of €250 euros is payable to the Valuation Office higher valuation band. when making a revision application. Relief is available from LPT in the following Where a Material Change of Circumstances (MCC) has circumstances: occurred, the Valuation Office issues a Proposed • Properties adapted for persons with disabilities, Valuation Certificate (PVC) setting out what changes, who occupy the property as their sole or main are considered appropriate for the property residence, and where the adaptations have increased concerned. the market value of the property may be granted an The occupier of a property can make annual reduction of one band. “representations” within 40 days of receiving a PVC. • Properties that are owned by a local authority or an The Valuation Office will review the position and try approved private body providing social housing are to reach agreement with the occupier (or other placed in the lowest valuation band regardless of their appellant). actual chargeable value for the first valuation period Revaluation 1 July 2013 to 31 December 2019. Before a valuation is finalized, the ratepayer receives Certain liable persons are eligible to defer payment of a “Proposed Valuation Certificate” from the Valuation LPT until the ownership of a property changes or the Office. The ratepayer may challenge this by making conditions for the deferral cease to be met. Deferral statutory “representations” to the valuation manager is subject to the payment of simple interest calculated within 40 days. This is an informal stage prior to the at the daily rate of 0.011% for each day that liability is more formal appeal processes which follows. There is deferred. no fee payable for this challenge. The ratepayer is These are: notified of the outcome of this, is provided with a final • Individuals who have gross annual income of assessment and is informed of the appeal options. If €15,000 and couples who have gross annual income the ratepayer is dissatisfied with the outcome of the of €25,000. The corresponding gross annual income consideration of representations, there is a right of thresholds for eligibility for a 50% deferral are appeal to the Valuation Tribunal, after the publication €25,000 and €35,000, respectively. These thresholds of the Valuation List. may be increased by 80% of mortgage interest (2) LPT: Individuals may appeal to the Revenue payments in the case of properties occupied as a Commissioners where they do not consider liable person’s sole or main residence and that are themselves to be liable persons. There are essentially subject to a mortgage. two reasons why this may happen. Firstly, an • The personal representatives of a deceased liable individual may not accept that he or she has the person are eligible to a maximum deferral period of relevant interest (such as ownership) in a property. three years. Secondly, an individual may consider that the • Insolvent individuals who have entered into a property is not chargeable to LPT because it is not specified statutory insolvency arrangement for the occupied and not suitable for use as a dwelling. A duration of the arrangement. determination made by the Revenue Commissioners • Deferral may be available on hardship grounds against an individual may be appealed to an depending on individual circumstances where there independent tribunal. has been significant unexpected and unavoidable Where an Individual is concerned that the valuation financial loss in the current year, and, as a result LPT declared was incorrect, they may self-correct the LPT cannot be paid without causing excessive financial return in the following circumstances: hardship. • the property is under-valued; or • exemptions or deferrals were incorrectly claimed. 15. Initial appeal process? (1) LAR: Self-correction cannot be used where: 47 | P a g e
• the property is over-valued; or The Tribunal’s decision on quantum is final; however, • exemptions or deferrals were not claimed but there is a further appeal on a point of law to the High should have been. and Supreme Court. In these circumstances the individual must apply (2) LPT: A taxpayer has the right to appeal to the online and submit a claim to the LPT branch with Appeal Commissioners against the following evidence to support the claim. For over-valuation this decisions of the Revenue Commissioners: must include documents to support the revised • A refusal of a claim for repayment. (lower) band e.g. details of sale prices, a professional • A determination that a person is a liable person. valuation, information on house prices survey in the • An assessment to LPT. area etc. • A determination that a liable person is not eligible for a deferral of LPT. 16. Independent body to determine unresolved An appeal against an assessment may encompass any appeals? (1) LAR: Yes, If the issue cannot be settled by dispute between the person and the Revenue discussion between the occupier and the Valuation Commissioners regarding the interpretation of the Office, an appeal may be made to the independent legislation, the ownership of the property, whether Valuation Tribunal, an independent body set up to the property is a liable property, the valuation of the settle disputed valuations between the Commissioner property and the liability of the person. The Appeal of Valuation and the ratepayers or local authorities. Commissioners is an independent appeals tribunal. A To be valid, an appeal to the Valuation Tribunal must taxpayer who is aggrieved by a decision of the Appeal be made within 28 days from the date of publication Commissioners has a further right of appeal to the of the Valuation List, or, in the case of a revision, 28 Circuit Court. An appeal to the Circuit Court is a de days from the issue of the final Valuation Certificate. novo appeal. Both the taxpayer and the Revenue The appeal must be in writing; it must specify the Commissioners have a right of appeal to the High grounds of appeal and must be accompanied by the Court on a point of law from the Appeal appropriate fee. Commissioners and the Circuit Court. For Revaluation appeals the fees are as follows: Valuation of property as Appeal Fee 17. Property tax revenue vs. other revenue? 1) LAR determined by the Commissioner income year ending December 2016 was of Valuation €1,467,970,000 – 59% of total local authority income Not exceeding €20,000 €95 for 2016 and 36.6% of actual local authority €20,001 to €50,000 €125 expenditure for 2016. €50,001 to €250,000 €300 (2) LPT income for year ending December 20916 was Exceeding €250,000 €500 €311,515,896 – 12.6% of total local authority income Fees payable in respect of Revision Notice Appeals are for 2016 and 7.8% of actual local authority dependent on whether a revaluation has taken place expenditure for 2016. in the Rating Authority Area. National tax take (all taxes) for 2017 = €50.737bn. Fees for Post Revaluation Revision Notices of Appeal are the same as for Revaluation appeals as above. 18. Any significant recent changes and important Fees for Standard Revision Notices of Appeal are as issues? (1) LAR: The Valuation (Amendment) Act follows: 2015, contains a number of important legislative Valuation of property as stated on Appeal Fee measures which are intended to accelerate and the Valuation Certificate or streamline how national revaluation programmes are Notification carried out in Ireland, including: Not exceeding €50 €95 • elements of self-assessment of valuations by €51 to €150 €125 ratepayers • engaging external contractors to €151 to €650 €300 undertake valuations Exceeding €650 €500 • streamlining of the current appeals process in the State • wider use of statistical analysis tools and processes 48 | P a g e
• a number of technical adjustments to the existing at the valuation date of 1 November 2016, to be legislation to improve operations. effective from 1 January 2017. Changes were made following a review of the LPT However, following pressure and concerns over rising which was carried out by Dr Don Thornhill in 2015. property prices in Dublin, in his budget 2016 speech, Thornhill also recommended that the Government the Minister of Finance postponed the revaluation postpone the planned revaluation of properties from date for LPT until 1 November 2019. 2016 to 2019, which it did. In 2018, a further review of LPT is to be undertaken NEW ZEALAND for the Irish Finance Department. 1. Title of Property Tax System? There is one The aim of the review is to provide the Finance property tax system which applies to the whole of Minister with information on any possible measures New Zealand; it is called property rates. It applies to he might recommend to the Government regarding 1.9 million rating units which are recorded on each of the revenue yield from LPT and the LPT's contribution 68 Territorial Authority district valuation rolls. to the total tax take. This will involve consideration of There is no land tax in NZ. whether the next revaluation, due to come into force in 2020 and with a valuation date of 1 November 2. Type of property taxed along with brief 2019, should go ahead. description? Real property is taxed. The review will also consider the outstanding This includes network utility assets. recommendations from the Thornhill review. These 3. Person tax legally imposed on? The taxpayer is the were that a revised system of assessing LPT liabilities person who is named as the ratepayer in the rating should be introduced, and that the Government information database and the district valuation roll. should switch from a three-year to a five-year Since 2002, the owner has been responsible for valuation period. He also suggested that the payment of property taxes. Prior to this the liability Government should consider moving to a system fell on the occupier and, in limited circumstances, the under which local authorities retain 100 percent of lessee may still be the ratepayer. the LPT revenues raised in their areas, and that LPT be re-designated as a local council tax. 4. Unit of assessment? Rating unit – legally defined Finance Minister Paschal Donohoe commented that: and supported by prescriptive rules setting out what "Even though it would be 2020 before LPT liabilities constitutes a rating unit as originally defined in the would be affected by any property revaluations, it is Rating Valuations Act 1998. important that the Government is able to make it its It is primarily based on a certificate of title and other position clear in relation to LPT in a timely way so that instruments of ownership (deed, proclamation, households will be aware of its plans for the tax in gazette notice, etc.). Certain types of long term, advance of the November2019 revaluation date and registered leases (surveyed and registered) also the associated 2020 and beyond LPT liabilities." qualify as rating units. "The current review of the LPT will be informed by the 5. Tax rate(s) set by? In accordance with the Local principle of achieving relative stability in the LPT Government (Rating) Act 2002, individual Local payments of those liable for the tax and provide clear Authorities have the power to set tax rates. direction on the likely payments faced by households There are 79 Local Authorities which include the 67 in 2020." Territorial Authorities and 12 Regional Authorities. (2) LPT: The Household Charge of €100 for each The Regional Authorities use the rateable values from residential property introduced by the Irish the Territorial Authorities’ district valuation rolls. Government in 2012 abolished in 2013 and replaced by the Local Property Tax. LPT, the responsibility of 6. Current tax rate? The Tax Rate varies for each of the Revenue Commissioners, was introduced from 1 the 67 Territorial Authorities & 12 Regional July 2013. The valuation, as at 1 May 2013, formed Authorities – they set a strike rate in the dollar of the basis of the tax from 1 July 2013 to 31 December rateable value each year to fund budget 2016. The proposed revaluation was to be carried out requirements. 49 | P a g e
Some Authorities rate substantially on rateable value 11. Frequency of general revaluations? Revaluations whilst others use a combination of rateable values are carried out at least every 3 years, normally on a 3- and targeted rates/uniform annual charges. year rotating cycle. There is no banding of rateable values and rating A third of councils revalue each year 22/67. policy can be varied in consultation with the Individual rating valuations can be updated during the ratepayer community. three-year period to reflect maintenance/supplementaries (new improvements 7. Frequency of adjustment of tax rate(s)? The tax or subdivisions.) rate is reviewed yearly depending on budget requirements and the rates policy of the individual 12. Date of last general revaluation? The revaluation authority. year varies for each of the 67 Territorial Authorities; A strike rate in the $ of rateable value is set each year. however, roughly a third of Authorities carry out their revaluations in each year of any 3-year cycle 22/67. 8. Tax collected by? Territorial Authorities collect for their own district and may also collect on behalf of the 13. Valuation date used for current assessment Regional Authorities. period? As an example, in Auckland the last general revaluation had an valuation date of 1 July 2017, and 9. Assessor responsible for assessments? The will form the basis for rate collection from 1 July 2018. valuations are the responsibility of the Territorial Authorities. 14. Main exemptions/reliefs? All properties are All valuations have to be completed under the valued on the district valuation roll in accordance with authority of a Registered Valuer and the councils can the rating Valuations Act 1998 irrespective of their elect to carry this out inhouse or contract the work rateable status. out to an external valuer. The Local Government (Rating) Act 2002 Schedule 1 Currently, all rating valuations in New Zealand are identifies a number of property types that are non- contracted out, with the exception of Auckland rateable, including: Council who have in house valuation resources national parks, wildlife reserves and conservation covering some of their district. The largest valuation areas service is Quotable Value responsible for an civic use heritage and recreational buildings estimated 85-90% of all property tax valuation work. state schools (not private ones) Before any revaluations are finalised, they have to be religious premises audited and certified as meeting the minimum some types of Maori freehold land standards by the Valuer-General, an independent machinery statutory officer responsible for regulating the rating roads valuations system across New Zealand. airport passenger movement and runway areas, parliament 10. Basis of valuation? The Local Government common marine and coastal areas. (Rating) Act 2002 Part 1 Section 13 specifies that the 15. Initial appeal process? Following a revaluation, rateable value of a rateable property may be either ratepayers can object to their assessment within 30 the annual value, capital value or land value of the working days from the date the new valuations are land, but must be specified by the individual local issued to the owners. The objection must be based on authority as the value for setting a general rate. comparable sales and served on the relevant Open market sale evidence is used for both capital Territorial Authority. and land value, based on a freehold tenure The Territorial Authority must then undertake a assumption, actual condition, highest and best (not review of the assessment in the light of the evidence actual) use, and disregarding actual leases unless they of sales and are able to use the same Registered are at prevailing market levels (rent and occupancy). Valuer who undertook the revaluation if they so wish. On the update of an individual rating valuation during the currency of the rating roll, the ratepayer can
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object within 20 working days of receipt of the issue rates more fairly is by questioning the need for of the updated valuation. retaining statutory exemptions. The objection must be based on comparable roll Central government sets the exemptions, but local parcels rather than actual sales, and the council must communities pay for them, as the rates burden in undertake a review of the assessment on this basis. each area is spread over a narrower base than would otherwise be the case. 16. Independent body to determine unresolved Exemptions could be removed and the land either appeals? Ratepayers can appeal to the Land become rateable in the same way as other land or a Valuation Tribunal within 20 days of the decision of grant be paid to the local authority in lieu of the rates. review letter from the council. Communities could be allowed to vote if they wish to An appeal to the decision of the Tribunal may be provide a rate remission e.g. to a service that provides made to a higher court on a point of law e.g. High a community benefit. Court; Court of Appeal; Supreme Court. Adopting Efficient Pricing 17. Property tax revenue vs. other revenue? There is The use of targeted rates as an attempt to indicate reported to be a 99.5% collection rate, and non- the cost of certain services to ratepayers does not payers can be subject to a forced rating sale (with the represent a “price”, as ratepayers are required to pay exception of Maori Freehold Land which is protected). them and cannot choose to forego the service and not In Auckland, the revenue from rates provide pay the targeted rate. approximately $1.64 billion (45%) of the council’s Not all services funded by local government can or funding. should be funded by user charges. Some services are The remaining $2 billion (55%) of the council’s provided for the benefit of the whole community and funding comes from grants, subsidies, development not an individual; for other services, communities will and financial contributions, user charges and fees, judge it unfair to provide the service only to those and debt. who can afford to pay. Debt is used to invest in new assets; for example, Councils could be assisted to improve their capability, infrastructure and new libraries. decision-making and performance, by providing 18. Any significant recent changes and important guidance notes on the factors to be considered in issues? In recent years, Local Government New deciding whether revenue is to be raised through Zealand have issued discussion papers considering rates or user charges, methodologies for estimating initiatives to support a “prosperous” New Zealand. the trade-off involved (e.g. economic efficiency This has included an in-depth look at improving verses distributional impacts). funding efficiency, with specific reference to property taxation. SINGAPORE One of the four key themes distilled from consultation 1. Title of Property Tax System? The tax is - and summarising what New Zealand communities known as property tax and is calculated by want from a local government funding regime - was multiplying the annual value (AV) of the “A diverse set of funding tools for New Zealand property by the prevailing property tax rate. communities to respond to the different challenges Property tax is governed by The Property Tax they face, with property rates as a cornerstone Act (Chapter 254) 1961 as revised. The supplemented by revenue sources that equip local national tax administration – Inland Revenue communities to meet current and future of Singapore (IRAS) is responsible for the opportunities”. assessment and collection of the tax. The following methods of improving funding efficiency relevant to property taxation are being 2. Type of property taxed along with brief considered: description? Property Tax is levied on immovable Enhancing the Rating System properties in Singapore which includes: In relation to business properties, a proposed solution • houses; relating to the need to redistribute the burden of 51 | P a g e
• buildings – including non-residential properties, for non-residential properties has been stable for docks/wharves etc., storage tanks and oil refineries; many years. • land – including chattels forming part of the land; 8. Tax collected by? By Section 4 of the Act, The and Comptroller of the Property Tax administers the tax • tenements – network properties e.g. railways, and is responsible for collection. pipelines, cables, ducts etc. are considered as tenements. 9. Assessor responsible for assessments? By Section 4(2) of the Act, the Chief Assessor is responsible for 3. Person tax legally imposed on? The tax is levied on the assessment of the annual values of properties and property owners (Section 6(2)) irrespective of including them in the Valuation List. whether property is owner-occupied, rented out, or left vacant. 10. Basis of valuation? The basis of the tax, by virtue “Owner” is defined as the person receiving the rent or of Section 2(1) of the Act, is Annual Value (AV). who would receive the rent if the premises were let Annual Value is an estimate of gross annual rent to a tenant, and includes any agent, trustee or which could reasonably be expected assuming the receiver, or the person whose name is entered in the landlord is liable for repair, insurance, maintenance Valuation List. or upkeep and all taxes (except Goods and Services Any grantee or lessee of a property comprised in a Tax). State lease, state land grant, or a lease of property by This applies to all categories of property except for a public authority for a period exceeding three years wharves, piers, jetties or landing stages where the shall also be deemed to be the owner for property tax assumption is that the tenant is responsible for the purposes. expenses of repair, insurance, maintenance or upkeep. 4. Unit of assessment? The unit of taxable property For land parcels, AV is determined as 5% of the depends on whether the assessed unit(s) is/are estimated capital value of the land. owned by one owner, capable of independent 11. Frequency of general revaluations? The AVs of occupation and the extent and purpose of the properties are reviewed on an annual cycle. The date occupation. Each assessed unit can be part of a of revision takes effect from the 1st day of the building and subdivided horizontally or laterally. following year for residential properties and usually 5. Tax rate(s) set by? The tax rate is set by the from the 1st day of the ensuing month after the Ministry of Finance. completion of the review for non-residential 6. Current tax rate? All non-residential properties are properties. taxed at 10%. 12. Date of last general revaluation? Revaluation Since January 1, 2015 owner-occupied residential takes place annually. However, the properties may be properties with an annual value below $8,000 pay no revised more than once a year if there are drastic property tax. Tax rates increase progressively for changes in market rentals. bands of annual value with a tax rate of 4% applying 13. Valuation date used for current assessment between $8,000- $47,000 up to 16% for properties period? The date of valuation for residential with annual value in excess of $130,000. properties is the 1st day of the following year and For non-owner-occupied residential properties, the usually the 1st day of the ensuing month after first band is $0-$30,000 with a tax rate of 10% completion of review for non-residential properties. progressing to 20% for properties with annual value in excess of $90,000. 14. Main exemptions/reliefs? Section 6(6) of the Act lists properties exempted from payment of the tax. 7. Frequency of adjustment of tax rate(s)? The tax To be exempt, the property, or any part, must be used rates were last reviewed on January 1, 2015, although exclusively: this affected residential properties only. The tax rate
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• as a place for public religious worship; • as a public The changes provide the basis to implement an "opt- school which is in receipt of grants in-aid from the out" approach for digital tax notices - currently, Government; property tax payers must give their specific consent • for a charitable purpose; or before they can opt for digital notices - and clarify and • for a purpose conducive to social development in enhance the information gathering powers of the Singapore. Comptroller of Property Tax, the Chief Assessor and their authorized officers. 15. Initial appeal process? Appeals against AVs fall It also provides the basis for hearing of appeal in within Section 20A of the Act. If the owner of the absence of any member of the Valuation Review property disagrees with the AV of his property, he (or Board. his agent) can lodge an objection by written notice to the Chief Assessor at any time within the current year and make a request for the AV to be amended. The SOUTH AFRICA amendment is limited to the current year. 1. Title of Property Tax System? There is one system If the Chief Assessor has amended the AV by to levy rates in South Africa and the term used is Valuation Notice, the owner may object to the Property Rates. The enabling legislation is the Local alteration within 30 days from the service of the Government: Municipal Property Rates ACT, (Act No Valuation Notice. 6 of 2004), also referred to as the MPRA, as amended in 2009 and 2014. 16. Independent body to determine unresolved appeals? Where the owner is dissatisfied with the 2. Type of property taxed along with brief outcome of the Chief Assessor’s review, the owner description? The following definition of “property” is may lodge an appeal with the Valuation Review Board applicable for property rates: (VRB) within 30 days of the decision. The VRB is an immovable property registered in the name of a independent tribunal constituted under the Property person, including, in the case of a sectional title Tax Act. scheme, a sectional title unit registered in the name A property owner who is dissatisfied with the decision of a person; of the VRB may appeal to the High Court within 21 a right registered against immovable property in the days of the date of the decision. The procedure for name of a person, excluding a mortgage bond appeals to the High Court is governed by the Rules of registered against the property; Court. a land tenure right registered in the name of a person or granted to a person in terms of legislation; 17. Property tax revenue vs. other revenue? public service infrastructure (Note - which is further Property tax is a centrally imposed and collected tax, defined) which, together with other taxes, is pooled into the Further each property is required to be assigned a Government’s Consolidated Fund for the category determined by the rates policy of the development of Singapore. This includes spending on municipality. The purpose of property categories is infrastructure, defence, healthcare, education and differential rates. The tariffs are annually revised as recreation. part of the budget. For 2016, the amount of property tax expressed as a % of GDP was 1.1%; and the amount of property tax 3. Person tax legally imposed on? The following expressed as a % of total taxation was 9.3%. Updated definition of “owner” is applicable for property rates: figures for property tax collection for financial year a) in relation to a property referred to in paragraph 2017/2018 are not yet available. (a) of the definition of “property”, means a person in whose name ownership of the property is registered; 18. Any significant recent changes and important b) in relation to a right referred to in paragraph (b) of issues? Following a public consultation in May 2017, the definition of “property”, means a person in whose the Property Tax (Amendment) Act 2017 was given name the right is registered; assent in October 2017.
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c) in relation to a time-sharing interest contemplated viii) a buyer, in the case of a property that in the Property Time-sharing Control Act, 1983 (Act was sold by a municipality and of which No. 75 of 1983), means the management association possession was given to the buyer pending contemplated in the regulations made in terms of registration of ownership in the name of the section 12 of the Property Time-sharing Control Act, buyer. 1983, and published in Government Notice R327 of 24 Further a municipality may also determine categories February 1984; of owners and criteria for the purposes of rates relief d) in relation to a share in a share block company, the (exemptions, rebates & reductions), e.g. Pensioners share block company as defined in the Share Blocks in terms of adopted rates policy. Control Act, 1980 (Act No. 59 of 1980); 4. Unit of assessment? This is directly linked to the e) in relation to buildings, other immovable structures definition of property however the legislation also and infrastructure referred to in section 17(1)(f), caters for multiple purpose use properties which can means the holder of the mining right or the mining be rated as a dominant use category of property or as permit; a specified multiple purpose category. f) in relation to a land tenure right referred to in In the application of dominant use, the category of paragraph (c) of the definition of “property”, means a property would be the dominant use based on the person in whose name the right is registered or to building development size, e.g. if a property has two whom it was granted in terms of legislation; or uses business and residential, depending on the g) in relation to public service infrastructure referred policy, if more residential than business it would to in paragraph (d) of the definition of “property”, attract the residential category “rate” and if the means the organ of state which owns or controls that reverse, more business, it would attract the business public service infrastructure as envisaged in the “rate”. definition of “publicly controlled”, provided that a In the application of multiple purposes, the value of person mentioned below may for the purposes of this the property would be apportioned based on each Act be regarded by a municipality as the owner of a different use type and a category of property property in the following cases: determined for each apportioned value and a rate i) a trustee, in the case of a property in a trust levied. Therefore, each category of property on a excluding state trust land; property would attract the applicable “rate”. ii) an executor or administrator, in the case of a property in a deceased estate; 5. Tax rate(s) set by? The tax rate(s) are set by each iii) a trustee or liquidator, in the case of a municipality intending to levy rates on property and property in an insolvent estate or in the power to levy rates is through the Constitution, liquidation; the Municipal Property Rates ACT (MPRA) and a iv) a judicial manager, in the case of a municipality’s adopted rates policy. A tax rate is set property in the estate of a person under against each category determined in the rates policy. judicial management; 6. Current tax rate? Tax rates are the responsibility of v) a curator, in the case of a property in the the municipality and therefore differ between them estate of a person under curatorship; and are also dependent on the revaluation cycle. vi) a person in whose name a usufruct or There are therefore no conclusive tax rate stats on other personal servitude is registered, in the highest, lowest and average rates for each category of case of a property that is subject to a property. usufruct or other personal servitude; A property tariff or property tax rate is determined at vii) a lessee, in the case of a property that is a local government level, following an obligatory registered in the name of a municipality and public participation process. Due to the provision that is leased by it; local government may determine the tax rate levied, viiA) a lessee, in the case of a property to rates per category of property can vary significantly which land tenure right applies and is leased and are also influenced by the category of property by the holder of such right; or 54 | P a g e
profile mix. Properties used for agricultural, public Nature Reserves 0.0517 service infrastructure and public benefit organisation purposes have a prescribed maximum net tariff ratio 7. Frequency of adjustment of tax rate(s)? The tax to the residential tariffs as follows: rate(s) are reviewed annually and may be adjusted Residential 1:0.25 Agricultural/PSI /PBO. through community participation and by adoption of Typically, Commercial/Industrial property is 2 to 3 the municipality. times higher than the residential tariff and vacant 8. Tax collected by? Local government – municipal land may be charged a punitive tariff to encourage collection. development, and to discourage speculation and land banking. 9. Assessor responsible for assessments? An Example 1: Assessor is termed municipal valuer and assessments The extract below is from Naledi Local Municipality: termed valuations. Valuations for property rates are Municipality Property Rates By-Laws 2017, and currently conducted at a local government level and indicates the ratios adopted in relation to the may be through an internal municipal valuation residential rate, and the tariff cent/rand for 2016/17. structure and/or contracted to the private sector. A % municipal valuer, who must be registered with the INCREASE 2016/17 statutory controlling body, the South African Council PROPERTY TAXES OVER TARIFF for the Property Valuers Profession (SACPVP), is 2015/16 designated by a municipality and is responsible for TARIFF the compilation and certification of a valuation roll. Ratio in relation to Residential Rates 10. Basis of valuation? The basis of valuation is the Residential 1.00 market value of a property subject to specified areas Business 2.00 that must be disregarded, such as immoveable Industrial 2.00 equipment, mining rights, any unregistered lease, for Agricultural 0.25 agricultural property the value of any annual crops or Agricultural: rowing timber that has not been harvested at the Businesses 0.50 date of valuation. Government 4.50 Property must be valued in accordance with generally Tariff - Cent per Rand Value of Property recognised valuation practices, methods and Residential 0.68 6.40% standards and the provisions of the MPRA. Business 1.35 6.40% 11. Frequency of general revaluations? A valuation Industrial 1.35 6.40% roll is valid for a maximum of 4 years in respect of a Agricultural 0.17 6.40% metropolitan municipality, and 5 years in respect of a Agricultural: local municipality. Businesses 0.34 6.40% The validity of a roll may be extended by the MEC Government 3.05 6.40% (Member of the Executive Council) for local Example 2: government of the province under certain Extract from Greater Giyani Municipality Resolution circumstances, to a maximum of 5 years Levying Property Rates for 2017/18 (metropolitan municipality) and 7 years (local CENT AMOUNT IN municipality). CATEGORY OF PROPERTY THE RAND If a municipality chooses it may revalue within the Residential property 0.0063 cycle prescribed by Section 32(1) MPRA as amended. Business and commercial property 0.0252 12. Date of last general revaluation? The date of Government Property 0.0416 valuation and the effective date of valuation rolls vary Agricultural property 0.0125 by municipality mainly due to the initial phase-in of Churches/Industrial 0.0016 the legislation (MPRA) when it was promulgated in 55 | P a g e
2005. In terms of the MPRA the first rolls at market (d) owners of property situated within an area value were implemented in July 2007 and were affected by compiled over a three-year period up to July 2009. (i) a disaster within the meaning of the The deadline for implementation was extended to Disaster Management Act, 2002 (Act 57 2011. SA is now well into the 3rd revaluation cycle and of 2002); or only rolls that have been extended by the MEC for a (ii) any other serious adverse social or economic conditions: further year are being prepared for implementation (e) owners of residential properties with a in July 2018. market value lower than an amount 13. Valuation date used for current assessment determined by the municipality; or period? The date of valuation is set by the (f) owners of agricultural properties who are municipality and these may differ depending on the bona fide farmers. revaluation cycle. In terms of legislation the valuation (2A) In addition to the categories of rateable property date may not be more than 12 months before the determined in terms of section 8(2), a municipality date of implementation. may, subject to any ratio determined in terms of The current practice is for valuation dates to be set at section 19, for the purposes of granting exemptions, 1 July and then implemented the following year from rebates and reductions, determine such categories the start of the financial year, being 1 July. Further the based on – delivery of the roll is governed by regulation which (a) properties used for public services purposes; and specifies that a certified valuation roll must be (b) properties to which the provisions of the delivered and handed to the municipality by the 31 National Heritage Resources Act, 1999 apply, January preceding the date of implementation. or an institution that has been declared to be 14. Main exemptions/reliefs? Reliefs subject to the Cultural Institutions Act 1998. The enabling MPRA legislation, at Section 15(1) (3) The municipal manager must annually table in the provides for the following, which can be added to, council of the municipality a enhanced or clarified at a municipal level in the rates (a) list of all exemptions, rebates and reductions policy of the municipality: granted by the municipality in terms of “A municipality may in terms of criteria set out in its subsection (1) during the previous financial year; and rates policy: (a) exempt a specific category of owners (b) statement reflecting the income for the of properties, or the owners of a specific category of municipality foregone during the previous properties, from payment of a rate levied on their financial year by way of such exemptions, property; or (b) grant to a specific category of owners rebates and reductions. of properties, or to the owners of a specific category (4) Projections regarding revenue to be forgone for a of properties, a rebate on or a reduction in the rates financial year in relation to subsection (3) (b) must be payable in respect of their properties. reflected in the municipality’s annual budget for that 15 (2) When granting in terms of subsection (1) year as: exemptions, rebates or reductions in respect of (a) income on the revenue side; and owners of categories of properties, a municipality (b) expenditure on the expenditure side. may determine such categories in accordance with Exclusions section 8 (2) and sub-section (2A), and when granting Section 17 Other impermissible rates exemptions, rebates or reductions in respect of A municipality may not levy a rate categories of owners of properties, such categories (a) subject to paragraph (aA) on the first 30% of may include the market value of public service (a) indigent owners; infrastructure; (b) owners dependent on pensions or social (aA) on any property referred to in paragraphs grants for their livelihood; (a), (b), (e) and (h) of the definition of “public (c) owners temporarily without income; service infrastructure”;
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(b) on any part of the sea-shore as defined in the bearer of that community who officiates at National Environmental Management: services at that place of worship. Integrated Coastal Management Act 2007; 15. Initial appeal process? In SA, there is an initial (c) on any part of the territorial waters of the objection process and then an appeal process. Republic as determined in terms of the Maritime Zones Act, 1994 (Act 15 of 1994); Once the roll is delivered, a notice is required to be (d) on any islands of which the state is the published in a specified manner, inviting every person owner, including the Prince Edward Islands who wishes to lodge an objection in respect to any referred to in the Prince Edward Islands Act, matter in, or omitted from, the roll to do so within a 1948 (Act 43 of 1948); prescribed manner and within a stated period, which (e) on those parts of a special nature reserve, must not be less than 30 days. national park or nature reserve within the An objection is lodged with the municipality and meaning of the National Environmental forwarded to the municipal valuer for processing. An Management: Protected Areas Act, 2003 objection is then considered by the municipal valuer (Act 57 of 2003), or of a national botanical and a notification of the decision outcome is sent to garden within the meaning of the National the objector. If the objector is not satisfied with the Environmental Management: Biodiversity municipal valuer’s decision, the objector has a right of Act, 2004 (Act 10 of 2004), which are not developed or used for commercial, business, lodging an appeal to the municipality. agricultural or residential purposes; 16. Independent body to determine unresolved (f) on mining rights or a mining permit within appeals? An independent valuation appeal board is the meaning of The Mineral and Petroleum established by the province to hear and decide on Resources Development Act 2002, excluding appeals lodged and to review the decision of the any building, other immovable structures municipal valuer in objections, where the value has and infrastructure above the surface of the been changed by more than 10% upwards or mining property required for purposes of mining; downwards. (g) on a property belonging to a land reform 17. Property tax revenue vs. other revenue? beneficiary or his or her heirs, dependants or Municipal property rates are set, collected, and used spouse provided that this exclusion lapses locally. National and provincial governments do not (i) 10 years from the date on which such have the power to levy rates, nor do they share in the beneficiary’s title was registered in the office revenue collected. Revenue from property rates is of the Registrar of Deeds; or spent within a municipality, where the citizens and (ii) upon alienation of the property by the voters have a voice in decisions on how the revenue land reform beneficiary or his or her heirs, is spent as part of the Integrated Development Plans dependants or spouse. (IDPs) and budget processes, which municipalities (h) on the first R15 000 of the market value of a invite communities to input prior municipal council property assigned in the valuation roll or adoption of the budget. supplementary valuation roll of a municipality to a category determined by the 18. Any significant recent changes and important municipality issues? Substantial amendments of the MPRA was (i) for residential properties; or promulgated and came into effect on 1 July 2015. (ii) for properties used for multiple The most significant changes were: purposes, provided one or more Differential Rating components of the property are used Rating of PSI for residential purposes; or Validity of valuation rolls (i) on a property registered in the name of and used primarily as a place of public worship by Supplementary Valuations a religious community, including the official Provincial and National monitoring and residence registered in the name of that reporting community which is occupied by the office- Differential Rating 57 | P a g e
Property categories listed in section 8 are compulsory backdated to when the mistake was made, while and no longer discretionary. under-valuations are effective from the first of the Compulsory property categories (if these properties month following the notice of the supplementary exist in the municipality: valuation Residential Provincial and National monitoring and reporting Industrial Critical milestones that must be monitored by the Business & Commercial MEC for local government in a province include: Agricultural Determination of the date of valuation Mining Advertising for appointment of external Public Service Purposes valuer by municipalities without in-house PSI capacity by a certain date Public Benefit Organisations used for specific Designation of municipal valuer by the date activities determined by the Minister Multiple Purposes Submission of project plan by the municipal Any category determined buy Minister manager. The compulsory categories must be implemented by Submission of certified valuation roll by the 2022. municipal valuer Rating of PSI The project plan must include the following Rating on: milestones: Roads Date of valuation for the next general Water ways valuation and the date by which it must be Railways determined Runways & Aprons Date by which the municipality will advertise (Refer to paragraphs (a), (b), (e), (g) & (h) of for an external valuer, where applicable the definition of “public service Date by which the municipal valuer will be infrastructure” designated Is to be phased out over 4 years and from Date by which the municipal manager must 2019/20 will be excluded from rates. submit the quarterly reports to the MEC Validity of Valuation Rolls Intended date for submission of the certified The validity of valuation rolls: valuation roll by the municipal valuer. Reporting to Minister by municipalities Metropolitan municipalities – 4 years The format and intervals of reports, as may be Local municipalities – 5 years The rolls could be extended to 5 years for Metros and prescribed, on the following matters: 7 years for Local municipalities. Categories of properties, tariff per category, Supplementary Valuations relief measures for categories of owners Correction of a clerical or typing error on the value Rates ratios Revenue from rates was added as a cause particular to make a Revenue per category supplementary valuation. Revenue forgone on partial exclusions and It is no longer necessary to wait for a supplementary relief measures valuation roll to implement the amended value, it can Any matter that may be prescribed. be implemented on a daily basis and on the fly. The Reporting to Minister by MECs municipal valuer must notify the owner of the The format and intervals of reports, as may be supplementary valuation and there is a 30-day prescribed, on the following matters: window to request a review of the value by the Condonation granted to municipalities municipal valuer. Extension of the period of validity of The effective date where a property was substantially valuation rolls incorrectly valued was also amended. The correction Progress on next valuation where extension on a property that was over-valued must be was granted
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Establishment and terms of office of appeal The tax rate varies within the limits expressed above. boards Article 72 of Local Finance Act also allows some Any matter that may be prescribed. jurisdictions to charge higher rates in urban areas: • Capital cities of provinces, up to +0.07 (+0.06 rural) • Cities with transport services, up to +0.07 (+0.05 rural) SPAIN • Cities providing extra services, up to +0.06 (urban 1. Title of Property Tax System? Local property tax in and rural) Spain is known as IBI (Sp. Impuesto sobre Bienes • Cities with more than 80% of rural areas, +0.15 Inmuebles). rural. 2. Type of property taxed along with brief 7. Frequency of adjustment of tax rate(s)? Councils description? Real estate property consisting of both must approve the tax rate by the end of the previous land and buildings, situated in both urban and rural fiscal year. Most of the time they remain unchanged; areas. Both ownership and leasehold (usufruct) rights they are changed only when a revaluation process is to land (improved, unimproved) are included. carried out. 3. Person tax legally imposed on? The liable person is 8. Tax collected by? Municipal councils are the owner or legal usufructuary. responsible for billing, collection and enforcement of property tax; they may outsource part of these tasks 4. Unit of assessment? The property tax relates to to private companies (e.g. notification, bulk printing, real estate: land and buildings together as one IT management, etc.). property; Local Finance Act Royal Decree 2/2004. Municipal councils may also delegate property tax Non-building structures are not included; it is a tax on administration to senior self-government level, i.e. real estate. Provincial Council, so that the ‘supra-municipal’ The taxable unit depends on how the property is authority takes responsibility for the whole tax cycle associated in the deed. For example, the taxable unit from ‘upstream activities (discovery, registration, in an apartment block can be the flat including a exemptions/relief) to ‘downstream activities’ (billing, numbered parking place in the basement (if it is collection and enforcement). written in the deed) or the apartment and the parking space in two separate units. In all cases, land and 9. Assessor responsible for assessments? Valuations buildings are in the same taxable unit. are carried by the national government - the National Cadastral Office. 5. Tax rate(s) set by? Tax rate limits are set by a national law, the Local Finance Act. The council 10. Basis of valuation? The cadastral value of a decides on the tax rate within these limits: property (Sp. Valor Catastral) is established through • 0.4 – 1.2% for urban properties (as defined in Article the valuation procedure for both land and buildings, 7, Real Estate Cadastre Law); by considering value-determining property • 0.3 – 0.9% for rural properties (not urban or special characteristics such as: location, size, land type, purpose properties); building age, obsolescence, standard and condition. • 0.4 – 1.3 % for special purpose properties (i.e. The cadastral value has administrative status and production of electric power and gas, petroleum corresponds to the capital market value (defined as refining, nuclear power plants, dams, waterfalls and the most probable sale price of the property between reservoirs, highways and toll tunnels, airports and independent parties). commercial ports). The cadastral value cannot exceed market value; however, normally, the cadastral value is set at about 6. Current tax rate? All properties within a municipal 50% of market value. The law is the Law on Real boundary are subject to the same tax rate, i.e. the Estate Cadastre (Sp. Ley del Catastro Inmobiliario). property use is not reflected directly in the level of the tax rate, only as part of the valuation procedure.
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11. Frequency of general revaluations? General (i) up to 90% discount for special-purpose revaluation should take place every 10 years. properties; Between revaluations the cadastral value is updated (ii) up to 90% for large families; annually through procedures under the National (iii) up to 50% discount for energy efficient homes Budget. (typically using solar panels);
Municipalities may request an earlier revaluation (not (iv) up to 95% discount for ‘cultural heritage’ properties; earlier than 5 years) if the difference between market (v) up to 95% discount for business properties if and cadastral values is high due to: business activity has special (i) The adoption of a new/modified land-use zoning characteristics/purposes. plan; and Facultative incentives/relief require taxpayer to (ii) large changes in market values. apply and prove the case, after which the municipal 12. Date of last general revaluation? The National council decides the size of the discount case by case. Cadastral Office has been working on updating 15. Initial appeal process? An appeal against: cadastral values (2014-17 is a 4-year regularization • the cadastral value is submitted to the National period) due to the previous large swings in market Cadastral Office; values. Cadastral values are to be updated through • the property tax assessment is submitted to the the application of ‘correction coefficients’ so that all taxing jurisdiction, i.e. the municipal council. properties have values reflecting market prices for Appeals at the administrative level do not involve any 2003. During the regularization period, which has costs for taxpayers, as the intervention of lawyers and been extended until the end of 2018, the standard court agents is not compulsory, and no administrative revaluation processes are suspended. taxes are levied at this stage. 13. Valuation date used for current assessment 16. Independent body to determine unresolved period? See question above. appeals? If the appeal is totally or partially refused, it 14. Main exemptions/reliefs? The main exemptions is possible to seek a judicial review by filing an appeal are for properties owned by: with the contentious-administrative court of the (i) State, regional governments and municipalities capital city of the province. used for national defence/security, educational 17. Property tax revenue vs. other revenue? and penitentiary purposes; Municipal tax revenue comprises: 43% Taxes, 16% (ii) recognised religious associations, if used for Fees/Charges, 32% Grants from other level of declared purposes; (iii) Spanish Red Cross; In addition, the following are governments, 9% other revenue (administrative fees also exempt: and charges, fines and forfeits, profits of municipal (iv) diplomatic bodies - subject to reciprocity; (v) enterprises). common rural properties; Taxes: Real Estate Property Tax, Vehicle Tax, (v) rural areas populated with slow growing Economic Activity Tax, Tax on Constructions and protected species; Installations and works, and Land Appreciation (vi) property used by/for railway purposes (land, Tax facilities, buildings, stations, depots etc.) Fees/Charges: Water Supply, Garage entrances, Statutory incentive/relief: refuse collections (i) 50-90% discount for construction sites; Regional taxes: (ii) 50% discount during first three years from Gift and Inheritance Duty purchase of state-subsidized homes; Wealth Tax (individuals): temporarily suspended (iii) 95% discount for rural properties used by in some regions agricultural coops; Succession and Inheritance Tax (iv) up to 90% discount for farmhouses or ranchos Property Transfer Tax (ITP) (Impuesto sobre used for cattle breeding. transmisiones patrimoniales). If this is paid, VAT Municipalities can offer ‘facultative’ relief for: is waived Gambling tax 60 | P a g e
National/State taxes Government on the maximum increase of national Value added tax (VAT) property tax revenue; this is called the 'macro norm'. Personal Income Tax For 2018, the 'macro norm' is 1.97%. Corporate tax 6. Current tax rate? Tax rates are a percentage of the Alcohol and other special duties appraised property value. 18. Any significant recent changes and important Maximum tax rates for owners and occupiers in 2018 issues? The new revaluation system is still unknown. are as follows: It is believed that Cadastre is moving toward a Residential “continuous update scheme” based on online Owner information exchange of transactions among all Lowest tariff: 0.0446% stakeholders: Councils, Notaries, National Tax Highest tariff: 0.669% Agency, etc. Average tariff: 0.1237% Non-residential Owner Lowest tariff: 0.0748% THE NETHERLANDS Highest tariff: 0.7282% 1. Title of Property Tax System? Municipal Real Average tariff: 0.2674% Estate Property Tax (Dutch: Onroerende- Occupier (User) zaakbelastingen, or OZB). Lowest tariff: 0.0000% For residential properties, only an owner property tax Highest tariff: 0.4460% is applicable. Average tariff: 0.2019% For non-residential properties two levies apply: For example, the tax rates for The Hague for 2018 are (i) tax on an owner/landlord; and as follows: (ii) tax on an occupier/tenant. Who Type of Property % Property Value 2. Type of property taxed along with brief Owners Residential 0.0597% description? All immovable property: land, buildings Owners Non-Residential 0.2350% and ‘appurtenances’ (structures) including plant, Users Non-Residential 0.1983% machinery and equipment which is a fixed part of a real estate property. 7. Frequency of adjustment of tax rate(s)? Annually, in connection with the adoption of the municipal 3. Person tax legally imposed on? In case of budget. residential properties, the owner. In case of non-residential properties both the owner 8. Tax collected by? Billing and collection of property (landlord) and the occupier (tenant) pay Municipal tax can be done by: Real Estate Property Tax. An owner-occupier will pay Municipalities both taxes. Municipal partnerships Shared service centres (Common 4. Unit of assessment? The primary unit of agreements) assessment is determined by the unit of ownership. However, if a building or property is used, or intended 9. Assessor responsible for assessments? The taxable to be used, in parts as separate units then each such (assessed) values are determined by municipalities unit is a unit of tax assessment. and nationally supervised and monitored by the Netherlands Council for Real Estate Assessment 5. Tax rate(s) set by? Municipal councils set rates for (Dutch: Waarderingskamer). the Real Estate Property Tax. Municipalities may organise shared service centres Each municipality can decide to make the property (common agreements) for valuation and may tax rates as high as they want, but the Association of contract private valuation firms. Dutch Municipalities has made agreements with the 61 | P a g e
10. Basis of valuation? Taxable values of residential 17. Property tax revenue vs. other revenue? Shares properties are capital values (Dutch: WOZ-waarde: (%) of main categories of funding sources in WOZ-value) derived from comparable-sales municipalities are: valuations. (i) tax revenues 18.4% (including approx. 7.0% OZB); Taxable values for non-residential properties are (ii) other revenues 81.6% capital values usually derived from capitalised rental 18. Any significant recent changes and important values. issues? Nothing of significance. Three different valuation methods can be used: sales- At the moment, people who have paid off their comparison, income-capitalisation and DCF. mortgages don’t have to pay the home owners tax; Taxable values of special-purpose properties are however, the government is to start phasing this in capital values derived from Depreciated Replacement from 2019. Costs. 11. Frequency of general revaluations? Annual. UNITED KINGDOM 12. Date of last general revaluation? 2018. The new England valuations come into force on 1st January each year. 1. Title of Property Tax System? There are two 13. Valuation date used for current assessment recurrent property taxes in England: period? The valuation date is 1st January of the a) Business Rates (or National Non-Domestic Rates – previous year. NNDR system). This tax applies to all nearly 2.0 million non-domestic properties. 14. Main exemptions/reliefs? Statutory exemptions b) Council Tax. This tax applies to all 23 million are granted in respect of public roads, agricultural domestic (i.e. residential) properties. land (but not buildings), nature areas such as national and municipal parks and estates (if open to public), 2. Type of property taxed along with brief greenhouses, churches, diplomatic/international description? a) Business Rates – real property, but organizations/bodies, pumping stations and water also some rights over property (e.g. advertising defence works. rights). Personal property is not subject to business Additional optional (facultative) exemptions may be rates. However, some items of plant and machinery granted by municipalities (councils) for properties are included. Also, some “chattels” (e.g. builder’s below certain value thresholds (Efficiency exemption huts) may become rateable together with the land on WOZ-value ˂ € 12,000) and for municipal properties which they stand if they are sufficiently permanent. like gardens, parks and cemeteries. b) Council Tax – real property. Owners of residential properties may qualify for tax 3. Person tax legally imposed on? a) Business Rates – remission (waver) if 'ability to pay' is non-existent the occupier; but where a property is unoccupied, the because of low income. owner may become liable for what is known as Removable machinery and equipment such as silos, “empty rates” after a specified period of vacancy. cranes and lathes are also exempt. b) Council Tax – the resident; this is usually the owner 15. Initial appeal process? Taxpayers may complain as most residential properties in the UK are owner- to a municipality about the assessed value (WOZ- occupied, but it would be the tenant in the case of value: they can ask for a lower or higher value), and rented properties. The owner pays the property about tax exemptions/reliefs. element (75%) of this tax if the property is unoccupied. 16. Independent body to determine unresolved appeals? Taxpayers may lodge further appeals to: 4. Unit of assessment? a) Business Rates – the unit of (i) first to the District Court; occupation (called a hereditament) is the normal unit (ii) second to the Court of Appeal; and of assessment. In broad terms, a hereditament (iii) last to the Supreme Court. comprises a separately occupied property. The valuation assessment is called “rateable value” and is
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published in a “rating list”. In the UK, business rates index (CPI). The tax rate is also reviewed/changed are paid by occupiers (the rateable occupier) rather following a revaluation to take into account the than owners, so the unit of occupation is the unit of overall movement in rateable values. There are valuation/assessment, however, business rates are supplements to the basic tax rate that are set by paid by the owner if the property is unoccupied and Government, rather than varied in line with CPI or RPI. the unit of assessment in this case is that of the last b) Council Tax – tax payable for all bands (based on known occupation. the tax for a Band D property) are revised annually. b) Council Tax - the unit of occupation (called a 8. Tax collected by? a) Business Rates – local hereditament) is the normal unit of assessment. The government (apart from rates on central list valuation band (see below) for each property is properties; these are collected by central published in a “valuation list”. government). Until recently, the revenue was paid 5. Tax rate(s) set by? a) Business Rates – tax rate set into a central pool and “redistributed” to local by national (i.e. central) government. governments according to a formula intended to b) Council Tax – there is no set tax rate for council tax; reflect their “need”. This central pooling system is the amount of tax is determined by which of 8 value currently being changed and will result in local “bands” the property falls into (see below). Each local governments retaining 100% of the revenue government set a rate for a Band D property, and then generated from non-domestic rates. legislation sets out what is paid for each council tax b) Council Tax – local government. band based on this level. 9. Assessor responsible for assessments? a) Business 6. Current tax rate? a) Business Rates – 47.9% (46.6% Rates – valuation assessments are provided by the for small businesses with a rateable value of between Valuation Office Agency (VOA); the VOA is a central £15,000 and £51,000) for 2017/18 fiscal year. government agency. b) Council Tax – as stated in Q5 above, there is no set b) Council Tax – property bandings are provided by tax rate for council tax; the amount of tax is the VOA. determined by which of 8 value “bands” the property 10. Basis of valuation? a) Business Rates – rateable falls into and the amount of tax set for each band by value is an estimate of the open market annual rental local government. Legislation controls the proportion value of the property (based on a number of statutory of tax payable between the different bands - each valuation assumptions, e.g. that the property is local authority sets its own rate for a Band D property vacant and to let, is in reasonable condition, etc) and then, the amounts payable for each of the other Legislation: Local Government Finance Act 1988 (as bands is in proportion to that. See table below: amended) Schedule 6.
b) Council Tax – the value banding is based on the Valuation Band Range of Values open market sale price of the property (based on a A Up to and including number of statutory assumptions, e.g. that the £40,000 property is freehold, is in reasonable condition, the B £40,001 - £52,000 valuation reflects existing use, etc.) C £40,001 - £52,000
D £68,001 - £88,000 11. Frequency of general revaluations? a) Business E £88,001 - £120,000 F £120.001 - £160,000 Rates – Revaluations should be undertaken every 5 G £160,001 - £320,000 years. However, there was a 7-year period between H More than £320,000 the latest revaluation (2017) and the previous revaluation (2010). The next business rates 7. Frequency of adjustment of tax rate(s)? a) revaluation will be 2021 i.e. a four-year revaluation, Business Rates – tax rate revised annually; any and after that every three years. increase limited to change in inflation (RPI), however b) Council Tax – no general revaluation since the from 2018 this will alter to the (lower) consumer price council tax system was introduced in 1993. 63 | P a g e
12. Date of last general revaluation? a) Business rateable value (less than £12,000) get 100% Rates – 2017. relief from rates and those with a rateable b) Council Tax – no general revaluation since the value between £12,000 and £15,000 get council tax system was introduced in 1993. “tapered” relief. SSBR does not apply to properties with a rateable value above 13. Valuation date used for current assessment £15,000. period? a) Business Rates – Valuations are based on b) Council Tax – there are quite a number of an antecedent valuation date (AVD) which is set 2 exemptions including dwellings undergoing major years before the date the rating lists come into effect, repair works to make them habitable, buildings i.e. April 1, 2015. unoccupied for 6 months, those occupied by full time b) Council Tax – April 1991 students, etc. 14. Main exemptions/reliefs? a) Business Rates - The Reliefs include: The Council Tax bill assumes that main exemptions are specified in the primary there are two adults living in a dwelling. If only one legislation – the Local Government Finance Act 1988 adult lives there (as their main home), the bill is (as amended) Schedule 5 and include: reduced by one quarter (25%), and council tax benefit • agricultural land and buildings; is available for people on low incomes. There are new • fish farms; reliefs for fibre optics and others, and councils now • places of religious worship; have power to increase liability on long-term vacant • lighthouses; properties. • sewers; 15. Initial appeal process? 2014 or Updated • parks; Information: • property used for disabled persons; a) Business Rates – The appeal system relating to • air raid protection works; • swinging moorings; business rates changed with effect from 1 April 2017. • road crossings over watercourses (e.g. Previously, a ratepayer (or, more usually, a bridges); and professional agent acting on behalf of a ratepayer) • properties situated in an enterprise zone. could make a “proposal”; this was a notice served on There are a number of reliefs (e.g. partial exemption) the VOA requesting a change in the assessment - given in respect of: normally seeking a reduction in the rateable value. In • rural properties; dealing with a proposal the Valuation Office would • stud farms; consider the rating assessment in the light of the • properties occupied by charities; grounds proposed and discuss the matter with the • Hardship relief is available at the discretion ratepayer or agent, with a view to either agreeing a of local governments for businesses revised assessment or the ratepayer withdrawing the suffering unusual hardship. Relief is also proposal. Should the proposal remain unsettled, it available for properties which are only partly would be transmitted to the Valuation Tribunal for occupied for a period of time (Section 44a England (VTE), without payment of fees. relief). • Partial relief is available for empty From April 1, 2017, ratepayers have to follow a new properties; no rates are payable for the first process called “Check, Challenge, Appeal” (CCA). 3 months the property is empty (6 months in In broad terms, the new CCA system is more onerous the case of industrial properties). Thereafter, for ratepayers and their agents to make appeals. the owner of the property may become A “check” against an assessment must include: liable to pay the full amount of rates. • any factually incorrect data (survey, merger • Smaller business properties are assessed at a or division of assessment, demolition, lower tax rate than larger business change of use etc.) or otherwise confirm that properties (see above). In addition to the the data held by the VOA is correct; lower business tax rate for small businesses, • details of something external to the property there is special small business relief (SBRR) that has affected its value; or which means that properties with a very low 64 | P a g e
• details of a court decision that materially funded through council tax and retained business affects the value of the property. rates. A “challenge” (or proposal) may only be made if a 18. Any significant recent changes and important check has been completed and challenges the issues? a) Business Rates - It may be helpful to valuation. It must be accompanied by a supporting understand that, for many years, business rates in the statement clearly showing why the challenge has UK have been regarded as a national tax collected been made, that the reason for the challenge falls locally. This was because the valuations are carried under one of the specified grounds, and include out by a central government body (the VOA), the tax relevant evidence supporting the challenge. rate was set by central government (DCLG in the case An “appeal” may be made if there is no agreement of England), and the revenue collected (by local between the parties in the challenge stage. The government) was pooled centrally (within DCLG) and appeal is served on the VTE. then distributed back to local governments according b) Council Tax – taxpayers may appeal to the local to a formula intended to reflect their need. government if they consider they are entitled to an This is now changing, and local governments will exemption or relief. Taxpayers may appeal to the VOA gradually move to retaining 100% of the rate income if they wish to challenge the banding of a new they collect. With regard to the contribution that property or they consider there has been a material business rates make to overall government revenues, reduction in the value of the property due to changes see attached extract from the UK 2017 Budget. to the property or its locality. Appeals on Council Tax The subject of business rates is currently very banding are referred to the VTE if not agreed. controversial in the UK. This is partly due to significant 16. Independent body to determine unresolved changes in both valuations and liability resulting from appeals? a) Business Rates – yes; the VTE (further the latest revaluation. appeals lie to the Upper Tribunal of the Lands It is also due to the very high level of business rates Chamber). compared with property taxes in other countries. The b) Council Tax – yes; the Valuation Tribunal (further latest changes to the appeals process which make it appeal is only allowed on a point of law). more difficult, and expensive, to appeal have also 17. Property tax revenue vs. other revenue? a) attracted widespread criticism. Business Rates - Local authorities in England collected b) Council Tax – no significant changes. However, £24.2 billion in non-domestic rates by the end of council tax is a very unpopular property tax and March 2017 out of a total of £24.6 billion collectable attracts considerable adverse media coverage and is (national average in year collection rate for non- very sensitive politically. The political sensitivity is domestic rates in England = 98.2%). why planned revaluations have been cancelled. b) Council Tax - Local authorities in England collected £26.0 billion in council taxes by the end of March 2017 Northern Ireland out of a total of £26.8 billion collectable (national 1. Title of Property Tax System? There are two average in-year collection rate for council tax in property tax systems in Northern Ireland as England = 97.2%). According to the United Kingdom prescribed by the Rates (Northern Ireland) Order 1977 Government spending and revenue figures from the (as amended): UK 2017 Budget document, the total tax revenue for a) Domestic Rates. This applies to all 800,000 the UK in 2017-18 is expected to be £690 billion. The domestic properties estimates for the annual revenue of the two main b) Non-Domestic Rates or Business Rates. This applies property taxes in 2017-18 is approximately £62 billion to all 75,000 Non-Domestic properties. meaning that property taxes contribution nearly 10% Figures correct as at 31/12/17. of total tax revenue. 2. Type of property taxed along with brief Based on published statistics, 57.5% of revenue description? a) Domestic Rates – real property expenditure was funded from government grant in b) Non-Domestic Rates – real property, but also some 2016-17, and 40.4% of revenue expenditure was rights over property (e.g. advertising rights). 65 | P a g e
3. Person tax legally imposed on? a) Domestic Rates Council Area District Regional Total – the resident; this is usually the owner as most Rate (£) Rate (£) Rate residential properties in Northern Ireland are owner- Poundag occupied. For rented properties, the landlord will be e (£) responsible for the rates where: Antrim & 0.00345 0.00417 0.007634 (i) The capital value of the property is less than Newtownabbe 7 7 £150,000; or y (ii) The property is a house in multiple Ards & North 0.00307 0.00417 0.007256 occupation (HMO). Down 9 7 If the capital value is in excess of £150,000 the tenant Armagh City, 0.00410 0.00417 0.008285 is responsible for the rates unless their landlord has Banbridge & 8 7 agreed to pay them. Craigavon Belfast 0.00319 0.00417 0.007376 The owner pays 100% of the tax if the property is 9 7 vacant. Causeway 0.00356 0.00417 0.007745 b) Non-Domestic Rates – the occupier, however for Coast and 8 7 rented properties the landlord will be responsible Glens where: Derry City & 0.00454 0.00417 0.008724 (i) The Net Annual Value (NAV) of the property Strabane 7 7 is £750 or less; Fermanagh & 0.00338 0.00417 0.007564 (ii) The NAV is between £751-£1590 and the Omagh 7 7 frequency of rent payment is monthly or Lisburn & 0.00288 0.00417 0.007062 weekly. Castlereagh 5 7 The tax is paid by the owner if the property is vacant Mid & East 0.00409 0.00417 0.008269 (see reliefs below). Antrim 2 7 4. Unit of assessment? a) Domestic Rates – the unit Mid Ulster 0.00312 0.00417 0.007303 of occupation (called a hereditament) is the normal 6 7 unit of assessment. The valuation for each property is Newry, 0.00369 0.00417 0.007869 Mourne & 2 7 called the “capital value” and is published in a Down “valuation list”. b) Non-Domestic b) Non-Domestic Rates –the unit of occupation (called Council Area District Regional Total a hereditament) is the normal unit of assessment. The Rate (£) Rate (£) Rate valuation assessment is called the “Net Annual value” Poundag and is published in a “Valuation List”. e (£) 5. Tax rate(s) set by? For both domestic and non- Antrim & 0.24083 0.32920 0.570036 domestic rates, the rate is set partly by the Northern Newtownabbe 6 0 Ireland Executive (the regional rate) and partly by y local district council in which the hereditament is Ards & North 0.21684 0.32920 0.546047 Down 7 0 located (the district rate). Armagh City, 0.24854 0.32920 0.577741 6. Current tax rate? From 1 April 2015, following local Banbridge & 1 0 government reform, the number of councils from 26 Craigavon to 11. Belfast 0.26348 0.32920 0.592681 The tables below set out the 2017/18 Regional Rate, 1 0 District Rate and Total Rate for both Domestic and Causeway 0.24477 0.32920 0.573976 Non-Domestic properties across each of the 11 Coast and 6 0 councils in Northern Ireland. Glens Derry City & 0.29163 0.32920 0.620831 a) Domestic Strabane 1 0
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Fermanagh & 0.20714 0.32920 0.536343 12. Date of last general revaluation? a) Domestic Omagh 3 0 Rates – 2007 Lisburn & 0.21530 0.32920 0.544500 b) Non-Domestic Rates – 2015 Castlereagh 0 0 Mid & East 0.28615 0.32920 0.615350 13. Valuation date used for current assessment Antrim 0 0 period? a) Domestic Rates – 1st January 2005 Mid Ulster 0.23536 0.32920 0.564569 b) Non-Domestic Rates – 1st April 2013 9 0 14. Main exemptions/reliefs? a) Domestic Rates – Newry, 0.22990 0.32920 0.559104 agricultural dwellings (20% valuation adjustment), Mourne & 4 0 occupancy by minister of religion (50% relief), Down Disabled Person’s Allowance, relief for individuals on
low incomes or on Universal Credit, empty properties 7. Frequency of adjustment of tax rate(s)? For both (e.g. excluded if the property's capital value is under Domestic and Non-Domestic Rates, the rate is revised £20,000, if it is a listed building, if the owner is the first annually, by both central government and local developer or builder of a newly built home that has council. never been occupied since it was first entered in the 8. Tax collected by? For both Domestic and Non- capital value list etc), hardship relief. Domestic Rates, Land & Property Services (LPS), b) Non-Domestic Rates Revenue and Benefits Directorate bill and collect The following are excluded from the Valuation List; rates. fish farms, most farmland and farm buildings, most cemeteries and crematorium, turbary and fishing 9. Assessor responsible for assessments? For both rights, moveable moorings, public parks and sewers. Domestic and Non-Domestic Rates, valuation The following are exempt or partially exempt; assessments are provided by Land & Property places of public religious worship and church halls Services (LPS), Valuation Directorate. district council swimming pools and recreation 10. Basis of valuation? a) Domestic Rates – the capital facilities charity shops selling only donated goods. value is based upon the amount which, subject to Reliefs are available for industrial premises, small certain assumptions, the hereditament might businesses with NAVs below £15,000, empty reasonably be expected to realise if it had been sold premises, sport and recreational facilities, residential on the open market by a willing seller at the relevant homes. capital valuation date. c) Both – The following apply to both Domestic and b) Non-Domestic Rates – Net Annual Value is an Non-Domestic ratepayers: estimate of the open market annual rental value of Landlords allowance of 10% for payment the property (based on a number of statutory before the due date. This allowance is assumptions, e.g. that the property is vacant and to mandatory for Domestic properties for let, the tenant is responsible for repairs and insurance which rate payment is the responsibility of and the date of valuation is as set out in statute). the landlord (see above) and may be applied for where the landlord has signed an 11. Frequency of general revaluations? There is no agreement to pay the rates on all their statutory provision governing the frequency of rented properties. Articles 20 & 21 Rates revaluations. The timing of a revaluation is a matter (Northern Ireland) Order 1977. for the Department of Finance. The pattern of The District Rate Subsidy was introduced revaluations in Northern Ireland has been somewhat following the reduction in number of erratic. There is now an acceptance from all major councils in 2015. It was applied to ratepayers parties that regular Non-Domestic revaluations who had a district rate level significantly should take place, although the precise detail for the higher from 1 April 2015 than it was under time between Revaluations has not been re- their previous council. It is applied to the established in legislation. district rate amount until 2019. The rate of
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discount for the current year 2017/18 is 40%, hereditaments in each council area and the district then 20% for 2018/19. rate struck. 15. Initial appeal process? a) Domestic Rates – the 18. Any significant recent changes and important ratepayer may apply to LPS, at any time, if they issues? From 1st April 2015, the 26 district councils in believe their assessment to be incorrect or they Northern Ireland were reconfigured down to 11 believe they are entitled to a relief or exemption. In councils. Those 11 councils retain the power to set the the first instance their application will be to the annual property district tax rates. District Valuer responsible for the area within which There are no plans to have a Domestic revaluation, their property is located. If dissatisfied by the decision however LPS are currently working on the 2020 of the District Valuer, they can appeal to the revaluation of Non-Domestic properties, with a Commissioner of Valuation for Northern Ireland. valuation date of 1 April 2018. The last revaluation b) Non-Domestic Rates - the ratepayer may apply to was in 2015. LPS, at any time, if they believe their assessment to Regular business revaluations were supported by the be incorrect or they believe they are entitled to a business community in consultation exercises in 2015 relief or exemption. In the first instance their and 2016, recognizing the importance of ensuring application will be to the District Valuer responsible that the rating system remains closely aligned to for the area within which their property is located. If market values for business ratepayers. dissatisfied by the decision of the District Valuer they can appeal to the Commissioner of Valuation for Scotland Northern Ireland. 1. Title of Property Tax System? There are two 16. Independent body to determine unresolved recurrent property taxes in Scotland: appeals? a) Domestic Rates – if dissatisfied with a a) Business Rates (or Non-Domestic rates) - this decision by the Commissioner of Valuation there is a tax applies to all 245,000 non-domestic right of appeal to the Northern Ireland Valuation properties.
Tribunal (NIVT) (with further appeal on a point of law b) Council Tax - this tax applies to all 2.5 million domestic (i.e. residential) properties. to the Lands Tribunal for Northern Ireland or in some cases the Court of Appeal). The NIVT also hears cases 2. Type of property taxed along with brief regarding certain exemptions and reliefs. description? a) Business Rates – real property, known b) Non-Domestic Rates – If dissatisfied with a decision as “lands and heritage”. Personal property is not by the Commissioner of Valuation there is a right of subject to business rates. However, some items of appeal to the NIVT (mixed properties with NAV less plant and machinery are included. Also, some than £12,500) or otherwise to the Lands Tribunal for “chattels” (e.g. builder’s huts) may become rateable Northern Ireland (with further appeal on a point of together with the land on which they stand if they are law to the Court of Appeal). sufficiently permanent. b) Council Tax – real property. 17. Property tax revenue vs. other revenue? The regional rate helps to supplement Northern Ireland’s 3. Person tax legally imposed on? a) Business Rates – share of national taxation allocated through the the occupier; but the tax is paid by the owner if the Barnett formula for public expenditure. The rating property is empty. system provides significant revenue for Northern b) Council Tax – the occupier. The owner pays this tax Ireland, with well over £1.25 billion now collected in if the property is unoccupied. Some discretionary rates — regional and district, Domestic and Non- relief can be given by the local authority. Domestic. 4. Unit of assessment? a) Business Rates – a rate is The total regional revenue portion raised in £680 levied against lands and heritage in one occupation. million with the balance of £1.25 billion going to the The valuation assessment is called “rateable value” eleven local councils according to the value of the and is published in a “valuation roll”.
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b) Council Tax – the unit of occupation (called a collected are pooled at the devolved level and dwelling) is the normal unit of assessment. The redistributed to the levying authorities via a needs- valuation band (see below) for each property is based formula. Scotland also operates a Business published in a “Council Tax List”. Rate Incentive Scheme. b) Council Tax – local councils carry out the levying 5. Tax rate(s) set by? a) Business Rates – tax rate set and collection of the Council Tax. by Scottish government. b) Council Tax – there is no set tax rate for council tax; 9. Assessor responsible for assessments? a) Business the amount of tax is determined by which of 8 “value Rates – the valuations are carried out by the 14 “bands” the property falls into (see below). The Assessors for each of Scotland’s 32 local councils. Council Tax liability is set by each local authority for Four are appointed directly by a single Council and the Band D and other bands bear set proportions to this remaining ten are appointed by Valuation Joint amount. Boards comprising elected members appointed by two or more Councils. Each assessor is an 6. Current tax rate? a) Business Rates – the tax rate independent official, however, the Scottish Assessors for 2017/18 is 46.6p in the pound (i.e. 0.466% of the Association work to provide a consistency of property’s rateable value). For 2017/18 there is a approach to carrying out the statutory duties for large business supplement - all properties with a rating purposes. rateable value over £51,000 will have a 2.6 pence b) Council Tax – property bands are provided by each supplement added to the poundage. of 14 separately appointed local Assessors as for b) Council Tax – there is no set rate for Council Tax. business rates above. Each local authority sets its own rate for a Band D property and then, the amounts payable for each of 10. Basis of valuation? a) Business Rates – rateable the other bands is in proportion to that, as set by value is an estimate of the open market annual rental legislation. The tax Rate payable will be dependent on value of the property based on a number of statutory the value band for the property, see table below. valuation assumptions, e.g. that the property is Band Amount of Value Band Percentage available to let, is agreed between a willing landlord Letter of Band D and tenant on an FRI basis. A Under £27,000 67% b) Council Tax – the value banding is based on the B £27,001 to £35,000 78% open market sale price of the property based on a C £35,001 to £45,000 89% number of statutory assumptions, e.g. that the D £45,001 to £58,000 100% property is freehold with vacant possession, is in a E £58,001 to £80,000 131% reasonable state of repair, the valuation reflects F £80,001 to £106,000 163% existing use, etc. G £106,001 to £212,000 196% H £212,001 and over 245% 11. Frequency of general revaluations? a) Business Rates – revaluations should be undertaken every 5 7. Frequency of adjustment of tax rate(s)? a) years. However, there was a 7-year period between Business Rates – tax rate revised annually; any the latest revaluation (2017) and the previous increase generally limited to change in inflation (RPI). revaluation (2010). In practice, the annual change in In practice, the annual change in business rates has business rates has followed that in England. followed that in England. b) Council Tax – there have been no general b) Council Tax – the tax payable for each band (based revaluation since the council tax system was on the tax for a Band D Property) is revised annually. introduced in 1993. 8. Tax collected by? a) Business Rates - the unitary 12. Date of last general revaluation? a) Business councils are the ‘levying authorities’. They prepare Rates – 2017. The current valuation rolls came into the tax bills, send them out to rateable properties, effect on April 1, 2017. collect the tax and take enforcement action to ensure payment in appropriate cases. In Scotland, the rates 69 | P a g e
b) Council Tax – there have been no general Enterprise areas – up to 100% relief for revaluation since the council tax system was businesses in certain sectors setting up or introduced in 1993. relocating to these areas; Renewable energy generation relief – up to 13. Valuation date used for current assessment 100% subject to RV limits and profit sharing period? a) Business Rates – 1 April 2015 with community organisations; and b) Council Tax – 1 April 1991 Hardship relief – in some local council areas. 14. Main exemptions/reliefs? a) Business Rates b) Council Tax Exemptions from the Valuation Roll are covered by Exemptions from the Valuation List include: different enabling legislation and include: (i) unoccupied dwellings, subject to a time limit; for example, dwellings which are agricultural land and buildings; unoccupied and unfurnished, for up to 6 fish farms, fishing, and sporting rights; months; those undergoing major repair public parks; works to make them habitable for up to 12 sites of Automatic Telling Machines (ATMs) months. in rural settlements; (ii) unoccupied dwellings, without a time limit; oil and gas pipelines; for example, unoccupied and unfurnished diplomatic missions; dwellings which were last occupied together sewers; with agricultural lands; unoccupied churches and other places of worship; dwellings where the liable person was sub-sea telecommunication and electric formerly resident and has moved to receive cables; personal care or the liable person has left to off-shore electricity generators; and provide care. day nurseries (from April 2018). (iii) occupied dwellings which are, for example; There are a number of “reliefs” (e.g. partial the sole or main residence only of people exemption) given in respect of: under the age of 18 years; occupied only by Small Business Bonus Scheme (SBBS). students and student halls of residence; held (i) RV up to £15,000 – 100% relief; for the purpose of armed forces (ii) RV £15,001 to £18,000 – 25% relief; accommodation. (iii) Occupation of more than one There are a number of “reliefs” (and possible business property where the additional charges) which may be available: combined rateable value is £35,000 (iv) the Council Tax bill assumes that there are or less, 25% relief on each individual two adults living in a dwelling. If only one property with a rateable value of adult lives there (as their main home), the under £18,000. bill is reduced by one quarter (25%); Empty business relief. (v) local authorities having discretion to set (i) 50% for the first 3 months and discounts for second homes and long-term thereafter 10%; or empty homes between 10% and 50%; (i) 100% for the first 6 months for industrial (vi) for long term empty properties (more than properties and thereafter 10%. 12 months), local authorities have discretion Rural rate relief – 100% relief in designated to either grant no discount for empty homes rural areas with a population less than 3,000, or increase the council tax by 100%. subject to RV limits; There are two main classes of “reduction” that may Properties occupied by charities – 80% relief, be available: with the possibility of discretionary relief up (vii) disability reduction of one band may apply to 100%; where a home is adapted for a disabled Disabled persons relief – up to 100% for person; training/welfare/workshops for disabled (viii) Council Tax Reduction (CTR) was introduced people; from 1 April 2013 to replace Council Tax Benefit (CTB). At this time the UK government funded the Scottish 70 | P a g e
government to the extent of the total of the separate local bodies and are not part of a unified CTB less 10%. The Scottish Government Tribunal system. Nominally they are independent of continues to provide additional funding to the Assessor. local authorities to ensure those who More complex appeals can be heard by the Lands previously received CTB could be protected Tribunal for Scotland. Further appeals lie to the Lands from this 10% cut. CTR works by comparing Valuation Appeal Court. the amount of income a person has with the b) Council Tax – yes; the local Valuation Appeal Panel amount that a person needs to live on (their (further appeal to the Court of Session is only allowed 'applicable amount'). If their income is less than the applicable amount, they may be on a point of law). entitled to a reduction of 100%. If their 17. Property tax revenue vs. other revenue? a) income is above the applicable amount, Business Rates - An estimated 5.2% of non-North Sea entitlement to CTR is reduced by 20p for tax revenues collected from/in Scotland was from every £1 of income above the applicable business rates in 2016/17. Business rates, council tax, amount. land and buildings transaction tax, landfill tax and 15. Initial appeal process? a) Business Rates – some income tax liabilities are devolved to the taxpayers may apply to the local authority if they Scottish government. Approximately 16% of devolved consider they are entitled to an exemption or relief. tax collected is business rates. A taxpayer, or their agent, may appeal against an b) Council Tax - An estimated 4% of non-North Sea tax assessment in the Valuation Roll, to the local revenues collected from/in Scotland was from assessor’s office: business rates in 2016/17. Business rates, council tax, (i) following a revaluation; land and buildings transaction tax, landfill tax and (ii) on the acquisition of an interest in a some income tax liabilities are devolved to the property; Scottish government. Approximately 12.5% of (iii) following the issue of a Valuation Notice by devolved tax collected is council tax. the assessor; (iv) if there is an error in an assessment; or 18. Any significant recent changes and important (v) if there is a material change of circumstances issues? a) Business Rates – The Land Reform Act 2016 affecting the rateable value of the property. removed the exemption for shooting rights and Most appeals are settled following discussions obliged the Assessor to re-enter shooting rights and between the assessor and the ratepayer. However, if deer forests in local valuation rolls from 1st April a settlement cannot be achieved, the appeal will 2017. proceed to a hearing by the local Valuation Appeal In 2016 a report into non-domestic rates was Committee. commissioned by the Scottish Government and Appeals against assessments in the Valuation Roll are headed by Ken Barclay, the former head of Scottish subject to strict time limits. operations for the Royal Bank of Scotland. The Report b) Council Tax – taxpayers may appeal to the local of the Barclay Review of Non-Domestic Rates was authority if they consider they are entitled to an published in August 2017. The 30 recommendations exemption or relief. were aimed at boosting economic growth, improving Taxpayers may make a proposal to the Assessor if administration and increasing transparency and they wish to challenge the banding of a new property fairness, within its remit of revenue neutrality. or they consider there has been a material reduction The Scottish Government Finance Minister in the value of the property due to changes to the responded in September 2017, confirming that he property or its locality. Strict time limits apply. would seek to implement the "vast majority" of its 30 16. Independent body to determine unresolved recommendations. Four of the recommendations are appeals? a) Business Rates – yes; the vast majority of to be taken forward immediately: unsettled appeals are referred to the local Valuation (i) more regular revaluations - 3-yearly with a tone date one year before; Appeal Committee. Valuation Appeal Committees are
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(ii) a new relief for day nurseries – 100% from also some rights over property (e.g. advertising April 2018; rights). Personal property is not subject to business (iii) an expansion of fresh start relief to create a rates; however, some items of plant and machinery greater incentive to bring empty properties are included. Also, some “chattels” (e.g. builder’s back into economic use – an increase from huts) may become rateable together with the land on 50% to 100% for the first year of new which they stand if they are sufficiently permanent. occupation and that it should be available b) Council Tax – real property. after a property has been empty for six months rather than the current twelve; and 3. Person tax legally imposed on? a) Business Rates – (iv) a review of the valuation of plant and the occupier; but where a property is unoccupied, the machinery. owner may become liable for what is known as b) Council Tax – a cross party Commission on Local Tax “empty rates” after a specified period of vacancy. Reform, was established jointly by the Scottish b) Council Tax – the resident; the majority of Government and the Convention of Scottish Local properties in Wales are owner occupied, but where a Authorities in February 2015. The agreed remit was: property is rented, then the tenant would be liable. To identify and examine alternatives that would When a property is empty the owner would be liable deliver a fairer system of local taxation to support the but may get a discount. Discounts are decided by local funding of services delivered by Local Government. government. The report, “Just Change – A New Approach to Taxation”, published in December 2015, 4. Unit of assessment? a) Business Rates – the unit of recommended that the present system of Council Tax occupation (called a hereditament) is the normal unit be abolished in favor of a new progressive alternative, of assessment. In broad terms, a hereditament stating "Our analysis therefore indicates that a more comprises a separately occupied property. The proportionate property tax, implemented alongside a valuation assessment is called the “rateable value”, more progressive system of income and need based and these are published in a “rating list”. In the UK, reliefs, would be much fairer than the present council business rates are paid by occupiers (the rateable tax and connect better to both the income and the occupier) rather than owners, so the unit of wealth interpretations of ability to pay". occupation is the unit of valuation/assessment, Building on the recommendations, the Scottish however, business rates are paid by the owner if the Parliament passed legislation that amended the way property is unoccupied and the unit of assessment in Council Tax on properties in Bands E, F, G and H is this case is that of the last known occupation. calculated from April2017. The tax for these b) Council Tax – the unit of occupation (called a properties is now a higher percentage of the Band D hereditament) is the normal unit of assessment. The rate than previously, addressing a fundamental valuation band (see below) for each property is conclusion of the Commission on Local Tax Reform published in a “valuation list”. that the original Council Tax system was not 5. Tax rate(s) set by? a) Business Rates – a national progressive. non-domestic multiplier is set by the Welsh Assembly Government. Wales b) Council Tax – there is no set tax rate for council tax; 1. Title of Property Tax System? There are two the amount of tax is determined by which of 9 “value recurrent property taxes in Wales: bands” the property falls into (see below – previously a) National Non-Domestic Rates (NNDR) also known there were 8 bands but a 9th was introduced in 2005). as Business Rates. This applies to circa 111,000 non- Each local government set a rate for a Band D domestic properties. property, and then legislation sets out what is paid for b) Council Tax. This applies to circa 1.43 million each council tax band based on this level. domestic (i.e. residential) properties. 6. Current tax rate? a) Business Rates - This is set at 2. Type of property taxed along with brief the time of revaluation and then adjusted each year description? a) Business Rates – real property, but to reflect inflation (currently based on the Retail Price 72 | P a g e
Index for the September prior to the financial year in considered in Wales, it has not as yet been question but see below) until the next revaluation. introduced. For the tax year 2017/18 the rate is 49.9%. There is no b) Council Tax – local government. separate multiplier for small businesses in Wales. 9. Assessor responsible for assessments? a) Business b) Council Tax – there is no set rate for Council Tax. Rates – valuation assessments are provided by the Each local authority sets its own rate for a Band D Valuation Office Agency (VOA) an executive agency of property and then, the amounts payable for each of Her Majesty’s Revenue and Customs (HMRC), which the other bands is in proportion to that, as set by is independent from the local government Billing legislation. The tax Rate payable will be dependent on Authorities that collect (and indirectly benefit from) the value band for the property, see below. the tax. Band Amount of Value Proportion of b) Council Tax – property bandings are provided by Letter Band Band D the Valuation Office Agency (VOA). A Under £44,000 6/9 B £44,001 to £65,000 7/9 10. Basis of valuation? a) Business Rates – the C £65,001 to £91,000 8/9 rateable value is an estimate of the open market D £91,001 to 9/9 rental value of the property, based on a number of £123,000 statutory valuation assumptions e.g. that the E £123,001 to 11/9 property is vacant and to let, and in reasonable £162,000 condition, etc., as at a specified antecedent valuation F £162,001 to 13/9 date. £223,000 b) Council Tax – as stated above the valuation band is G £223,001 to 15/9 based in the open market capital value of the £324,000 property, based on a number of statutory valuation H £324,001 to 18/9 assumptions, e.g. the property is held freehold £424,000 I £424,001 and above 21/9 (except for flats which are assumed to be held on a 99-year ground lease), is in reasonable condition, the 7. Frequency of adjustment of tax rate(s)? a) valuation reflects existing use etc. as at a set date. Business Rates – tax rate revised annually; any 11. Frequency of general revaluations? a) Business increase limited to change in inflation (RPI), however Rates – since the Local Government Finance Act 1988 for the tax year 2017/18 this will alter to the (lower) five yearly revaluations were set in legislation (i.e. consumer price index (CPI) mirroring the change in 1990 and five yearly thereafter) – however, following England. The tax rate is also reviewed/changed the deferment of the revaluation in England (via the following a revaluation to take into account the Government’s Growth and Infrastructure Bill) by two overall movement in rateable values. years the Welsh Government has also deferred its b) Council Tax – tax payable for all bands (based on revaluation but the same amount. The latest the tax for a Band D property) are revised annually. revaluation came into force in 2017. Wales may 8. Tax collected by? a) Business Rates – local change to three yearly to align with England. government (apart from rates on central list b) Council Tax – not set in legislation, the original properties – i.e. properties occupied by “designated council tax valuation list came into force on 1 April persons” as defined in legislation that are used for 1993, and there has been one revaluation in Wales operational purposes, e.g. statutory water providers (on 1 April 2005) since that time. – this is collected by central government). The 12. Date of last general revaluation? a) Business amounts collected are placed in a central pool which Rates – 1 April 2017 is then redistributed to local government based on b) Council Tax – 1 April 2005 the number of people living in that specific area. 13. Valuation date used for current assessment Although the possibility of rates retention has been period? a) Business Rates – 1 April 2015
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b) Council Tax – 1 April 2003 residential care home, nursing home or hospital, 14. Main exemptions/reliefs? a) Business Rates: • nobody is living in the property and the Exemptions – These properties would not appear in person who paid the Council Tax has died the rating list and include: and probate hasn’t been granted, • agricultural land and associated buildings; • nobody can live in the property by law, • fish farms; because of the condition of the property or • places of religious worship; it is being bought by the authorities • public parks; (compulsory purchase), • highways; • the property is part of another property and • certain properties used for people who are is occupied by a dependent relative, for disabled. example, a ‘granny flat’, Reliefs – include: • nobody is living in the property because the • properties occupied by charities or non- person who usually lives there is living with, profit making organizations; and being cared for by, another person, • properties in enterprise zones subject to • nobody is living in the property because the qualifications and to a maximum of £55,000 person who usually lives there has moved to offset the cost of business rates in out to care for another person. 2017/18; Reliefs – the local government grant a single person • small business rate relief (100% for rateable allowances, where there is only one person living at values up to £6,000 tapering to zero at the property who would normally be liable for council rateable value £12,000); tax (25%), additionally people on low incomes can • a short period of relief for empty properties apply for council tax benefit, which is means tested. (first three or six months depending on the type of property); 15. Initial appeal process? A consultation by the • hardship relief; Welsh Assembly Government regarding possible • relief to High Street retailers subject to a changes to the appeals process in Wales has just rateable value cap of £50,000; closed and changes could follow as a result of this. • following the 2017 revaluation, transitional The current situation is as follows: relief has been introduced in Wales a) Business Rates – In Wales, the governing legislation supporting ratepayers whose eligibility for is The Non-Domestic Rating (Alteration of Lists and Small Business Rate Relief has been affected. Appeals) (Wales) (Regulations) 2005, as amended. A b) Council Tax: ratepayer (or, more usually, a professional agent Exemptions – all hereditaments appear in the council acting on behalf of a ratepayer) can make a tax valuation list, however a local authority can grant “proposal”; this is a notice served on the VOA “exemptions” from payment for things such as: requesting a change in the assessment - normally • the property is unoccupied and it needs or is having major repairs or structural alterations seeking a reduction in the rateable value, on any of a (12 months max), number of grounds specified by the legislation. • a charity owns the property and nobody lives Grounds for making proposals include that the there (6 months max), rateable value (or other part of the entry in the rating • there is no furniture in the property and list, such as effective date) is incorrect as appearing in nobody lives there (6 months max), the compiled list, or as a result of an alteration to the • the property is only occupied by people who rating list, or as a result of a material change of are aged under 18 years, circumstances either to the property itself or to its • the property is provided for student or locality (as defined by legislation). Only one proposal armed forces personnel is allowed per circumstance per taxpayer i.e. a new • nobody is living in the property because the occupier would have a right to make a proposal even person who usually lives there is in custody, if the previous occupier had also made a proposal on • nobody is living in the property because the the same grounds. person who usually lives there is living in a 74 | P a g e
It should be noted that the controversial new appeals of the Upper Tribunal, and then, only on a point of process introduced in England (CCA) has not been law, to the Court of Appeal and Supreme Court. introduced in Wales. See below. There is currently a government b) Council Tax – taxpayers may apply to the local consultation looking at the reform of the appeals government if they consider themselves eligible for system and the role of VTW. “exemption” or relief and can make a proposal to the b) Council Tax – yes; Valuation Tribunal for Wales VOA if they consider their band is too high. There was (VTW) with further appeal to the High Court only on a a fixed period of time for appeals when the 2005 point of law. valuation list came into force, this expired on 30 17. Property tax revenue vs. other revenue? The September 2006, and since that date there are only Welsh Government receives its budget from the UK limited circumstances in which an appeal can be Government. The Welsh budget is set through UK made. Government spending reviews, which set the budget Grounds for making an appeal and time limitations: for UK Government departments and devolved 1. The property was allocated an incorrect administrations. Adjustments to the Welsh budget band when the valuation list was compiled – are determined through the Barnett Formula and may appeal no later than 30 September 2006 2. Increase to size of property - may appeal at applied to the Welsh baseline budget. The Formula any time reflects changes that the UK Government makes and 3. ‘Material Reduction’ – part of the property applies them to comparable budgets in Wales. The has been demolished (unless the demolition resources for Wales are provided to the Wales Office is the first stage of building work) - may following a vote by the UK Parliament. The Secretary appeal at any time of State for Wales retains funding for the Wales 4. A property comes into existence or ceases to Office’s operations and the balance is transferred to exist - may appeal at any time Wales. Funding is allocated to the Welsh 5. If there is an increase/decrease in the part of Government, Assembly Commission, the Wales Audit the property used for domestic purposes Office and the Public Services Ombudsman by the within a composite property (a composite National Assembly for Wales. Within the funding property is a property with both business voted to it by the UK Parliament, the Welsh and domestic uses) -may appeal at any time 6. Addition of entry to the valuation list (if the Government has total discretion over where it spends property has been added to the valuation its money. A Draft Budget for the following financial list) - may appeal at any time year is proposed by the Welsh Government each 7. Deletion of entry from the valuation list (the autumn. Assembly Committees and other interested property is no longer liable for council tax) - parties then scrutinise and comment on the may appeal at any time Government’s spending proposals, before they are 8. The council tax banding appears to be finalised, and approved by the National Assembly for incorrect following a valuation tribunal Wales. Budget plans may be changed through a decision - may appeal within six months from Supplementary Budget motion approved by the date of decision National Assembly for Wales. While some of the
9. The council tax band for a property has been money is spent directly by the Welsh Government in altered - may appeal within six months from accordance with Ministerial priorities, a significant date of alteration proportion is allocated to the public bodies which it 10. A person becomes a taxpayer for a property - may appeal within six months of becoming sponsors and funds, for example Local Government, the taxpayer. the NHS in Wales and Welsh Government Sponsored Public Bodies. For 2016/17 the total Wales Delegated 16. Independent body to determine unresolved Budget was £14.52bn, of which £5.08bn (34.98%) was appeals? a) Business Rates – yes; the Valuation allocated to local government and communities. Tribunal for Wales (VTW) is an independent tribunal. The contribution made to this budget from Business Further appeals may be made to the Lands Chamber Rates and Council Tax was as follows:
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Business Rates – local government in Wales collected 4. Backdating appeals in respect of 2016-17 bills, £962m out of £993m 5. Fines (Civil Penalties) collectable (in 2016/17, billing authorities in Wales The introduction and level of fees for collected 97.8% of NNDR billed) appeals; and Council Tax - local government in Wales collected in The role of the Valuation Tribunal for Wales respect of 2016-17 bills, excluding council tax benefit, in the appeals process. £1.384bn out of £1.422bn collectable (in 2016-17, The consultation period ended on 9th January 2018, billing authorities in Wales collected 97.4% of council and details of the responses are currently being tax billed) reviewed. Total funding - £2.346bn, which represents 46.18% of b) Council Tax – The Welsh Government's draft the funding for local government and communities, budget for 2018/19 sees council budgets fall by and 16.16% of the total Wales delegated budget (the between 1.5% and 2% after inflation. Councils raise rest of the budget is received from UK taxes such as around £1.4bn annually from council tax, funding income tax, corporation tax, etc. that are about 16% of their spending on local services. It is administered by HMRC for the whole of the UK.) anticipated that councils will have to raise council tax for 2017/18 by the Welsh Governments preferred 18. Any significant recent changes and important maximum of 5%, or possibly exceed this figure. issues? a) Business Rates - The Welsh Government The Welsh Government has indicated its intention to instituted a review of business rates in Wales during consult on proposals to change council taxes in Wales 2012, led by Professor Brian Morgan. Amongst other in early 2018, which could include a revaluation. matters, the report recommended full devolution of business rates from the UK to Wales (there was full devolution as from April 2015) and some form of retention of business rates by local authorities (the Welsh Government’s response included a commitment to consider whether local communities could retain business rates from large renewable projects). A form of transitional relief was introduced for the 2017 revaluation, supporting small businesses where the effect of the revaluation has been to alter their eligibility to small business rate relief. This scheme is simpler and more limited in its application than the scheme in England. Unlike the scheme in England, the Welsh scheme is government funded rather than being funded by an additional levy on those who gain from the revaluation, as is the case with the English scheme. In October 2017, the Welsh cabinet secretary for local government published a consultation on proposals for reforming the system for non-domestic rates appeals in Wales. The topics covered in the consultation were: Proposals to reform: 1. The registration for the appeals process 2. The time periods for each stage 3. The provision of information
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