Former ACT Treasurer Ted Quinlan was one of the first witnesses to appear before an ACT parliamentary committee probing the change in formula for calculating rates and land tax for multi-unit complexes on Wednesday.

The change was announced in the 2016 budget and was to be phased in over two years, however that was extended to three years in the most recent budget due to a backlash from owners, some who'd seen their rates bill rise by 40 per cent in one year.

Mr Quinlan, a former Labor deputy chief minister, told the committee he had been rather reluctantly drawn into the debate because his name "has been associated with rates".

In 2012, he carried out the root-and-branch review of the ACT's taxation system and,  drawing upon the recommendations of Ken Henry, called on government to abolish stamp duty and insurance taxes in favour of rates and land taxes.

But Mr Quinlan said his review never recommended changing the rates formula for units and apartments.

He said the only issue that was discussed and never completely resolved was whether people occupying larger blocks of land should pay greater rates automatically (he believed they should not).

Instead, he said the change - which means that marginal rates are calculated on the unimproved value of a whole block, not divided by the number of units first - came from a "legitimate" problem the government identified in the 2016 budget - that the land value prescribed for units was far lower than that of houses.

"Just on a straight one-to-one basis unit owners in a very plush unit would be paying more in rates than someone just down the road in a pretty standard detached home. That is a problem," Mr Quinlan said.

But Mr Quinlan said the simple change in calculation failed to take into account the economies of scale unit developments offered to government.

"Living in a unit complex does impose on the unit owners additional costs of just being in that unit," he said.

"For the privilege of reducing the cost of city services they also have to pay corporate fees, and all the other things, and it’s a legal requirement for sinking fund contributions over the first few years. It’s quite an expensive exercise to buy and live in a unit complex."

Mr Quinlan said while everyone appear to agree with the principle of the taxation reform, the change had an "element of unfairness in it".

"If you read the 2016 budget, the government has realised they’re not generating as much revenue from units as they would like or might as compared to detached residences. That’s what they’ve changed. It’s got nothing to do with the replacement of stamp duty," he said.

"Regardless of whether you’re looking to abolish stamp duty or not they are seeking to normalise the process but they’ve stuffed it."

He said to reverse the problem would take a bit of work, but he had faith in the "very bright young people" in ACT Treasury.

"We talk about rating systems and everybody likes to use in the same sentence fairness and simplicity. Now unfortunately those two thing can be at odds with each other but I’m going to suggest we come down more on the side of fairness as opposed to simplicity," Mr Quinlan said.

"I think there’s capacity at least in the middle level in Treasury to work through all this stuff and I’d be very surprised and somewhat disappointed if some of this work hasn’t already been done."

The committee interrogated four other witnesses who'd made submissions about the personal impact they changes had on them.

Phillip Baron, who had a $400 per cent increase in his rates last year, said while he was "quite comfortable" with the removal of stamp duty,  "a percentage increase should be a percentage increase across the board".

Landlord Alexander Popov said the extra costs would be passed on to tenants, some of whom would not be in a position to buy even if investors exited the market and prices fell.

The inquiry continues next month.