ACT News


Canberrans shoulder burden of 60 per cent more rates

The average house owner in the ACT is paying 60 per cent more in rates than eight years ago.

Pialligo is the hardest-hit suburb. Average rates for stand-alone houses have more than doubled since 2005.

The rates system has undergone big changes in that time, including the introduction last year of a progressive taxation system, and a transition towards abolishing stamp duty and insurance tax.

Pialligo is the only area where rates on houses have doubled, but another eight suburbs have had average increases of more than 80 per cent. The lowest rises - 35 per cent - are in Harrison and Campbell.

ACT Treasurer Andrew Barr said the changes had made the system fairer. Average increases were in line with increasing land values, up 41 per cent since 2005-06, higher average incomes - up 38 per cent - and inflation.

''The government has been upfront about rates increases. We were clear when announcing tax reform that rates would rise to pay for the abolition of unfair taxes,'' Mr Barr said. ''It's also important to note that a quarter of households have in 2012-13 received a cut in their rates bill,'' he said, referring to the introduction of marginal tax rates.


But the ACT Ratepayers Association said the changes and projected increased revenue from rates had property owners in line for more increases in the next four years and ''bill shock'' for many.

''I know ratepayers who got rate increases as much as 36 per cent last year because of higher valued properties and many of these

people have lived in these properties for 20 and 30 years - it's not by design their properties have gone up in value. They can't go and sell a door or a window each week, yet they're getting hit with these massive rates bills,'' said Ratepayers Association president Peter Jensen, a former Liberal candidate for the Legislative Assembly.

''If you look at the forward estimates it shows the rate revenue increasing by 10 per cent per annum for the next four years. When you have a cumulative effect of 10 per cent increases, the five years starting last year of 10 per cent increases result in a total increase of 61 per cent.''

But Mr Barr said that reading of forward revenue estimates was misleading, with the land release program indicating there would be 18,000 new ''dwelling sites'' in the coming four years, 12 per cent more than the current number.

''The amount raised in rates is being shared across a greater number of households, thereby mitigating the overall average increase,'' he said.

Shadow Treasurer Brendan Smyth said that would not help in the long run.

''More houses mean an extended size of the city, which means more roads and more services and greater distance. The wider the city spreads, the more it costs to maintain,'' Mr Smyth said.

''This is a typical Labour government, they tax hard, they spend even harder and that's why we have deficits in the coming years.''

Abolition of stamp duty has been praised by economists and property bodies, but Mr Smyth said the new system would not please all. ''It's not fairer if your income doesn't go up to cover it,'' he said.

Mr Barr said there was a rates rebate, energy concession, and a water and sewerage concession for Canberrans who needed help.