16 Aug 2022

Offaly Councillor says commercial rates system needs national response

Speaking this week in response to businesses in Offaly receiving new valuations from the Valuation Office, Cllr. Sinead Dooley has said that the commercial rates system in Ireland is archaic and needs to be amended. "The current system is neither sustainable or equitable," she stated. 

Cllr. Dooley said, “Ireland’s commercial rates system requires a national response and needs to be urgently reviewed. Local authorities do not have the power to reform their funding sources, only central government can. Local businesses, not central government, are the primary source of income for local government in Ireland and this has to stop," she continued.

She insisted that "in Offaly, we have a very low rate base in comparison to other counties and this impacts on our services." "Currently, the main source of income generation for local authorities is through commercial rates and it is unfair that Offaly, in order to sustain the level of services which we deliver, has to impose a higher annual valuation rate than our nearest neighbours."

"How are businesses to remain competitive? How are we to attract new business if it is more cost effective in another county? Local Authority services need to be provided and paid for from Central Government and not from the business community who are already struggling to keep their doors open," Sinead maintained. 

Cllr. Dooley concluded by saying, “In 2016 the businesses contribution to the total local government budget grew to €1.47 billion or 36% nationally. This represents an almost 10% increase in the commercial rates contribution since 2008. Commercial rates are a form of local taxation, mostly to fund services that businesses do not consume. This has become all the more apparent in recent years. The transfer of water and wastewater services to Irish Water follows on from commercial waste services no longer being provided by local authorities.

Local authorities use business to balance their books. In other words, business picks up the tab for any expenditure gaps or funding shortfalls that arise in their annual budgets. Reductions in central government contributions and other revenue sources have resulted in local authorities becoming ever more reliant on local business for their revenue. This is not sustainable and Government must act as a matter of urgency if we want to see this economy grow.”

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