28 June 2021

Rates up by average 3.75 per cent, see what you will pay in 2021-22

| Ian Bushnell
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Weston Creek

Rates are going up, but not by as much in previous years. Photo: File.

Household rates will resume their march upwards in 2021-22 with an average 3.75 per cent rise as part of the next five-year phase of the ACT Government’s 12-year tax reform program.

The government has not released a suburb by suburb guide to rates rises as in previous years but a series of examples for house and unit owners in differing circumstances (see below).

For example, the bill for owners of a four-bedroom house in the Woden Valley with an average unimproved value (AUV) of $490,000, the highest example given, will be $136 (4.49%) more than in 2021-22.*

For pensioners, that will be $86 (3.69%), thanks to the pensioner rates rebate cap increasing by $50 to $750, which the government says will assist almost 15,000 households.

The owner of a three-bedroom house in Tuggeranong with an AUV of $315,000 will only pay $28 more (1.33%). A pensioner will actually pay $22 less.

The increase comes after a pause in 2020-21 to provide relief during the pandemic-induced economic slowdown, but the government says the heavy lifting has been done in the reform program and rates increases will be lower than in previous years during the next phase.

It is still providing some support, saying it will be directed at those who most need it.

The fixed charge component of household rates will be reduced, which Chief Minister Andrew Barr says will mean lower increases for properties with lower unimproved values and make the tax system more progressive.

For a unit, it will come down from $958 to $850, and for a non-unit from $823 to 800.

On top of this and the pensioner rates rebate cap increase, there have been recently announced increases in the utilities concession from $700 to $800 for around 31,000 households in 2021-22.

Other examples cover Tuggeranong, Gungahlin and Weston Creek, as well as Belconnen, and the Inner North and South for units.

Rates rises examples

New rate tables for the ACT. Image: ACT Government.

Mr Barr said the one-off $150 rates rebate to help offset general residential rates increases last year provided significant support across the community while retaining the fundamentals of the tax reform program.

“For almost two-thirds of Canberra residential property owners – 110,000 households – rates did not increase,” he said.

Opposition Leader Elizabeth Lee said in February, when Mr Barr handed down the first of two budgets this year, that despite promising a rates reprieve, 60,000 Canberrans still faced rates rises last year.

Mr Barr said the government would continue to cut stamp duty further, and details of the 2021-22 duty cuts would be announced at the start of the new financial year.

“By abolishing inefficient taxes such as stamp duty and replacing this revenue with our fairest and most efficient tax base, we increase economic activity and the productive capacity of the economy,” he said.

“A more stable revenue base also allows for the planning of long-term investments in key services such as health, education, community services and transport.”

Mr Barr announced in February that average general rates for residential and commercial properties would increase by 3.75 per cent each year from next financial year until 2025-26.

A government spokesperson said the suburb by suburb breakdown table was simply an average based on the varying AUV and housing types in any particular suburb but within each suburb there will be a wide variety of land values and dwelling types.

The government will provide aggregated information on the rates paid by the varying sizes and types of dwellings in suburbs with, or before, the 2021-22 ACT Budget in August.

Canberrans can expect to receive their rates notices via email or in the post over the coming weeks, including detailed information on their rates.

Canberrans can also visit the ACT Revenue Website to access a Rates and Land Tax calculator on 1 July, input their property AUV and determine their household general rates for the upcoming financial year.

To learn more, including cost-of-living assistance, visit www.revenue.act.gov.au.

* The key factors for houses are the average unimproved value of your property, the change in that average unimproved value over a five-year period relative to the change for other properties, and the rating factors split across the fixed charge and variable charge.

All scenarios for 2020-21 rates are calculated prior to the application of the one-off $150 rebate.

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Canberrans have nothing to complain about. Come across the border where rates are more expensive than Potts Point on Sydney Harbour

Robert Ballar5:20 am 09 Oct 21

The Govt is unable to control over the increase in prices which has created a havoc on affordable housing sector and on the other hand by increasing the rates is building the pressure on the average human being and indirectly indicating to sell off their properties which absolutely ridiculous. Its all the game played by the Govt and on other hand a strategic planning for garbing as much money from the society. I would encourage people should raise their voice against such increase which not affordable as a punishment for some others problems.

OpenYourMind8:14 pm 27 Jun 21

How bout locking rates rises to CPI rises.

HiddenDragon7:49 pm 27 Jun 21

With an ever-growing list of “million dollar suburbs”, and a steady flow of property porn articles about “suburb price record smashed”, it’s probably no surprise that the highest value example released by the ACT government was for an average unimproved value (AUV) of $490,000 – the “progressive” nature of the rates system is really going to start to bite as inflated valuations wash through.

It’s also probably no surprise that the ACT (affluent single-party social laboratory that it is) is looking like the only jurisdiction where the greatly over-hyped “reform” of shifting from stamp duty to annual rates will happen without very substantial federal government support (unlikely with federal debt heading to a trillion dollars).

After a brief burst of enthusiasm, it’s on the back-burner in Victoria and NSW has churned out reports and discussion papers etc., but can’t make it add up in a way that won’t cost them power (NSW Labor has already attacked it).

Fixed charge levy for rates:
“For a unit, it will come down from $958 to $850, and for a non-unit from $823 to 800”

Why are owners of units paying a higher fixed charge levy for rates than owners of houses pay?
Many units and townhouses are paying higher rates than stand alone houses. When stand alone houses are worth so much more than units. It needs to be investigated

Whilst I agree that the fixed annual amount for both apartments and units needs to reduce, Very very few apartments and townhouses pay higher rates than single houses on blocks (because most of the rates is on the square meter land value not the fixed price component).

The good news is the fixed charge component of the annual rates calculation has dropped. I’ve long advocated a reduction in the fixed amount the Government charges on each household as this should better balance out the tax that poorer households on lower value blocks pay annually.

I don’t know why the examples include the number of bedrooms to the house? It has no bearing on the actual rates calculation and it looks more like a cherry picked amounts at the thresholds in an attempt to hide some of the increases.

But I think this is heading in a better direction.

There should be no complaints from Greens/Labor voters because this is exactly what you voted for. And higher % rates increases next year, also in excess of % income rises, so more budget tightening for all family households.

I’m not a Labor voter but this is a good thing, with further reductions in stamp duty on the way.

They should move faster to complete the change earlier.

Shane, is that you? Or maybe even Andrew. Loyal Greens/Labor cadres and habitual apologists for rates increases will ignore this CT 1 June 2021 headline:
‘ACT stamp duty gives budget higher-than-expected boost.’
Stamp duty revenue up $41 million.

Acton,
Strange that i’m apparently an ALP/Greens apologist when I’m regularly criticising them. Mustn’t be very good at it.

And LOL at highlighting the boost in stamp duty, which is literally one of the things the change to land taxes is meant to prevent, through reducing the variability of government revenue linked to property booms.

Good to see you don’t like it.

You must agree with me as per my last comment that they should make the change faster. Good to have you on board.

Don’t you see the hypocrisy of what you are defending? Higher rates in exchange for lower stamp duty was promised, but the ACT Govt now collects more in rates and more in stamp duty. You are either deliberately deceiving others or unable to comprehend being deceived.

Acton,
Don’t you see that what you are criticising is literally the reason for the change.

If you are against the higher stamp duty receipts, you should logically want them to move faster.

You’re trying to use the fact that stamp duty is high due to a booming property market as an argument against the tax reform when it is in fact totally in support of it. The variability of stamp duty is one of the reasons it’s a poor and inefficient taxation source.

If the property market was tanking, would you be telling the government to raise taxes because stamp duty receipts were too low?

Of course you wouldn’t.

You’re either being deliberately disingenuous because you don’t want to pay any tax or you don’t understand the economics.

devils_advocate10:32 am 01 Nov 22

@Acton the most hilarious part is that when it was announced, the ACT Treasury claimed the reform would be “revenue neutral”

Lmao

Surely people didn’t believe the “government” would miss the opportunity to raise taxes even more

Certainly a bleak start to winter. First a letter from ACTEW telling me of a rise in power due to our use of cheaper renewable sources, and now a rate rise .

And probably more pain on Sunday when the Maroons get belted.
And just to round it off , yesterday I noticed petrol had hit a $1.50 per litre.

Finally Relented11:34 am 26 Jun 21

I’m retiring soon.might move over the border.

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