11 February 2005

Statement from David Thornton

Auckland City Rate Increases Point To Need For Total Rates Reform

The latest rate increase proposals from Auckland City Council emphasise the need for urgent reform of local government funding.

Residential ratepayers can no longer afford to continue paying ever increasing council rates bills.

The regional ratepayers rebellion of two years ago showed the depth of feeling aroused by rates increases, and while that rebellion brought some relief last year - together with promises of substantial central government funding for transport - the fundamental problem remains.

Rates are a property tax and bear little relation to ability to pay.

Rates are based on the possible price you might have got for your house if you had sold it on a particular day in the previous three years.

Local councils must work together, and with central government, to find an alternative method of funding local councils.

And local councils must delay any non-essential projects until such alternative funding is in place.

Meanwhile central government should give immediate relief by removing GST from rates.

ENDS

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