RATING SYSTEMS.

Shannon News, 16 November 1928, Page 1

RATING SYSTEMS.

NO CHANGE FROM CAPITAL

VALUE BASIS LIKELY IN COUNTY AN EXCEPTIONAL CASE DISCUSSED.

The relative merits of the capital value and the unimproved value systems of rating were under consideration at the meeting of the' Horowhenua County Council on Saturday. The present rating system in the County is on the capital value. The matter arose through a letter from Mr. D. H. Lea, of Otaki, who had previously written objecting to the amount of his rates, and who now wrote in reply to the Council't intimation that it could not give him any relief. He submitted that something more than a strict adherence to the law was necessary for smooth running. It was acknowledged that the system of rating, both in counties and boroughs, needed re-ad-justing, something simple and practical being required. His solicitor had 'advised him to take tip the matter of his rates wtih the ValueiyGreneral. Accompanying the letter were suggestions for alternative methods of rating. The chairman (Mr. Mon-k) stated that Mr. Lea had sent a lot of examples from his point of view, but he had based them on a fixed rate. What happened was this: In a case where a man had a small piece-of land .with heavy improvements on it, and which was rated on the capital value, the rates were very much heavier than they would be on the unimproved value. But there were two sides to this question. There was the fact of- the sea.side townships, whore the value of the land might not be £2O an acre, and where, under the unimproved system of rating, the owner would only pay a few pounds in rates, although he built a house worth £IOOO. In such cases the Council would have to inaintain roads for people who w T ere not producers to the district. The Council had had some practical figures taken out as affecting different people in the County. Mr. Lea's was quite an exceptional case in this County, because there were not many small areas, of five to ten acres, where there were improvements to the value of £IOOO to £ISOO, and which properties were purely residential. Where that was the case, the chairman supposed, there should be some tax on the wealth; there was a tax on the capital expended "there. Mr. Lea ? was" suggest'irig t&at the Council consider the question of rating on the unimproved value as against the capital value. The former system had been adopted by various counties in the Dominion. The chairman thought that, whatever system was in operation, there would be a section of the com- , munity on which a hardship would be inflicted. There was no equitable system of rating, apparently. If the County had a great deal of land undeveloped, the unimproved system might be a good thing, but much of its lands were swamp lands, which could not be developed at a rapid rate, but which had to be quietly and slowly developed. The Council would be putting a hardship on the people on the land at present if it rated on the unimproved value. He was not married to any particular system of rating, but after the examples which had been prepared by the Clerk for this meeting he was rather inclined to'think that in this County they had better stick to the rating on capital value. Cr. Jensen said it might be necessary, if the Council adopted the unimproved system, to have the Act amended, so. that in the case of lands which were not farm lands there should be a tax on the improvements; otherwise the Council would derive very little from those places, although it might have to ; go to considerable expense to maintain the roads. The chairman stated that in most of the examples taken out there was not much difference shown between one system and the other; but there were exceptions, and Mr. Lea's case was one of the greatest exceptions in the County. Under the unimproved system he would pay 9s 2d, but he nowpaid £3 1.9 s 7d on the general rate. It was also necessary to consider the hospital rate, which was levied by the Hospital Board on the capital value; and he did not know whether any change in the system of Tating would apply to the Board. The levy was made by the Board on the capital value of earii district, apart from the question of how the rate was levied again by the contributing local bodies.

The chairman moved that the letter be received and that Mr. Lea bo written to and thanked for his communication, but-that he be informed that the Council does not sec its way clear at present to make any alteration in the rating system. Or. Jensen: It is open for ratepayers to take action.

The chairman: I quite realise that; but they would want to investigate something like we have got out here and they would find that there would not be much difference.

The motion was seconded by Cr. Evder. and was carried.