ANNUAL VALUE RATING

Otago Daily Times, Issue 26616, 12 November 1947, Page 3

ANNUAL VALUE RATING

ADVANTAGES OUTLINED At a meeting held on Monday night Messrs J. C. Kirkness and K. Familton outlined the advantages of the present rating system in Oamaru—the annual value—as against the disadvantages of rating on unimproved value. Mr Kirkness said he was not electioneering, but only doing his duty to the public of Oamaru in explaining the advantages to be derived from the present system of rating. If the electors voted for a new system the change would come almost immediately. The principle of good rating was to pay for services, facilities, and benefits enjoyed by the members of the municipality, according to the degree or extent to which they were enjoyed, and always governed by the members’ ability to pay and the general public benefit. There had been much discussion about the high rates in Oamaru. but. Mr Kirkness said, wages had been increased in the period 1941 to 1947 by £5772, representing an increase of lOd in the £l. Up to 1940 the average rate was 4s 3£d in the £l,'and since then the rate had been increased to 5s sd. If the lOd in the £1 were added to the old rate this would show an increase in the new rate of only, 3jd, which must be considered satisfactory.

Rating on unimproved value had a tendency to cause a density in population in small boroughs and this had to be avoided. For rating on unimproved values the ratepayer would have to pay Is 6d in the pound on the Government valuation, and this was an inopportune time to bring forward a change in system as no one would know what his valuation would be until next March. He also stated that the new Government valuation would be based on land sales prices. Recently servicemen had purchased blocks of land on which to build, and they were waiting the time when they could build. The sections were purchased at £2lO to £3OO, and if rating on unimproved value came into force these servicemen would immediately start paying £ls 15s to £22 10s 6d in rates. The State was at present paying £ls to £l6 in rates for State houses, but if the unimproved value system was inaugurated they would only pay from £7 to £B. This was caused by the State being able to purchase land at a much lower rate than a private individual, and the State house property would be rated on its land sales value. At the present time £40.000 was paid in rates, and to maintain th's figure, other citizens would have to find at lease an additional £SOO. which would not be paid by the State. The North End was taken into the boroush in 1919 and no special rate was imposed on its citizens. The middle of the town and the South Hill bad to pay for the development of the North End, and if unimproved value rating were to come into force the south end of the town would again have to pay for the north end.

Rating on, unimproved value would mean that an owner of flats would pay the same as the owner of a private section immediately adjacent, although the owner of fiats would be drawing a large sum in rent.

Mr K. Familton said that if rating on unimproved value were carried some people would benefit, but others would lose. Capital value meant that house and land were valued, unimproved value meant a valuation on the land alone, and annual or letting value—that in force in Oamaru—meant valuation on the house on its letting value. If one section of the public was relieved of its rates another section would have to pay, and industry would receive the greatest gain. The unimproved value system would give residents " pocket handkerchief ” sections, and Oamaru would lose its reputation of being a garden borough. The present system protected the poorer class. A question that often came before his notice was why should a person have to pay more rates because he improved his building and land. Mr Familton said that when additions were made it added to the saleable value of the property, and when owners sold their property they received the benefit of this.

The Rev. D. H. Stewart (president- of the Oamaru Rating on Unimproved Value Association) proposed a vote of thanks to the speakers for their addresses.