RATING UNIMPROVED VALUES.

Gisborne Times, Volume XXVI, Issue 2214, 11 June 1908, Page 1

RATING UNIMPROVED VALUES.

ITS SUCCESSFUL OPERATION IN NEW SOUTH WALES. (By A. G. Hino, secretary, Rating on. Unimproved Values League.) ' \i Until recently local government in this State was confined to 192 municipalities, embracing only 283() square •miles. Under the new Act the wholo State, excepting tho sparsely settled Western division is administered by municipal and aliiro councils. Iho Sliiros number 134, and they took control of land valued at £07,000,000. Councils must lov.v their general rates’ on land values only with a maximum of twopence. They may impose special or local rates on either unimproved or improved values. Only one small local rate has been imposed. Shire Councils have no power to establish a Shire debt, and at a recent Sliiro Conferonco a (motion in favor oi power to raise loans was defeated by. a largo majority. The amount of outstanding rates at tho ond of tlVo first year of Sliiro Government was remarkably small. This is a tribute to the justice of land values taxation,, and the effective nowers provided for enforcing payment. At present, Councils must make an assessment every tliroo years of the “unimproved,” “improved,” and “annual” value of ratable land. The late conference asked that tho two latter assessments should bo ontional, that is, they wished to have tho option of discontinuing the trouble and exponso of assessing “improved” and “annual” values. So far, the'work of establishing; the now system was comparatively easy, although the Labor Party to a man, votod against the second reading of tho Shires Bill. As Mr. Carruthers said, “You could Write what you liked upon a clean slate.” In municipalities it was necessary to replace an existing system. Councils had levied tlieir rates on tho rental value, and on five per cent, of the capital valuo of unimproved land. In some cases they had power to levy rates under special Acts for water, and so on. Under tlio now system rates can only be imposed on “unimproved, or improved” value. Tho assessment of the annual value is only for statistical purposes. Every council must levy a rate of not loss than one penny in the pound upon land values only. If it chooses.—with few exceptions—it may impose one general rate to cover all requirements. Where there is a water supply under a special Act, as at Goulburn and other places, a water rate is necessary, and where an area, for convenience sake, was . added to a municipality, tho interest on an old loan has to be met by a local rate on the old area. The council, however, has the option of lovyjng such rates on unimproved) or improved values. The results are- remarkable. The returns to hand show that 140 councils have rated solely on land values, 114 of them having one rate for all service; 25 rated partly on both values, but fully three-fourths of their revenue will be from unimproved values. I have no information as to the remaining 25, principally because they are late in imposing their rates. One small council throw in its lot with the adjoining shire, and the. City of Sydney is under an. Act of its own; and is not'affected.

In seven municipalities, councils sought to rate partly on both values, and tho ratepayers demanded a poll. In every instance the council was defeated by a largo majority. This is the more striking when jt k. remembered thatUancrowUers only, T aro allowed to demand a- poll) and go to vote as to the incidence of tho rating. Occupiers can vote at the election of aldermen, but not on a rating referendum. The polls were ta'ken at Alexandria, Waverloy. Woollahra, Mosman, and Ramhvick in the metropolis tan area, and at Liverpool, and Wickham in the country. At broken Hill, a poll on a special rate resulted in defeating the nroposed service by a narrow, majority, while endorsing rating upon unimproved values by a.large majority. The land values in tho suburbs' amount to about £25,000,000 and the population to 430,000. They are governed by 40 councils, and they have imposed rates estimated to yield, after allowing for the effect of appeals, say £350,000. The highest rate is sjd in the pound, tho lowest 2d, with an average of, say, 3Jd. Tho wholo amount, with tho exception of a nominal sum of, say £BOO, is imposed on land values. In tho country municipalities, tho results are not quite so sweeping, but “unimproved land valuo taxation : has evidently come to stay.” Tho results are revolutionary, hut in,reality they are not so startling as unfriendly critics assert. For example, the rates upon one suburban property have gone up from £6 3s to £S33. That statement by itself is misleading. In the first place the land was .enclosed and let for a small rental and paid practically no rates, lint tlie owner paid a State land tax of one penny in the pound, amounting say, to £2OO. Under the new system the State does not collect tho land tax. It has handed over State expenditure on roads etc., amounting to £44,000 annually, and increased to collect £BB,OOO in land ,tax. As the councils have been given wider powers which make a larger revenue necessary, the deal is a fair one. A good many councils are raising largely increased revenues, but for all that it is estimated that the change in system of rating,, means a reduction in the rates paid by over 50 per cent, of the ratepayers, while largely increased sums are demanded from owners of idle land, or land with improvements unworthy of the site. The owners of good shops, factories and homes oil reasonable areas pay-lower rates, in many cases less than half the amount naid fofmerally. The owners of idle land are much more willing to meet the ideas of buyers, and many old buildings are to give place to new. It is impossible to say as much in one letter, as I would like upon such a big subject, but I am confident that the change from rating industry and improvements to rating unimproved values, will be a great success.