More than 300 Canberra businesses hit with rates rises

Canberra Liberals leader Alistair Coe was among several Assembly politicians to pose a series of questions about the revaluations of commercial properties across several suburbs during a committee hearing on Monday.

The committee heard the ACT Revenue Office in 2016 revalued some 311 commercial properties across Phillip, Civic, Turner, Braddon and Fyshwick; sending land values soaring and consequently hitting businesses with big rises in rates from July last year.

Among the 311 properties affected, which represent about five per cent of the 6146 commercial properties in Canberra, were 108 Phillip property owners, mainly car dealerships between Melrose, Athllon and Hindmarsh Drive.

For some businesses it has led to rates rises in the order of $100,000, with the rises most keenly felt in Phillip, where the total value of the 108 properties affected rising 79 per cent from $100 million to $179 million in 2017, or about $730,000 on average per property.

ACT Australian Automotive Dealers' Association chief, Phillip car dealer Peter Axiom, said the rates increase for his dealership had been about 300 per cent, though he declined to name a specific figure.

He said the entire automotive industry in Phillip, which he estimated employed about 1500 people, were not about to sack staff or close down, but the unexpected increases meant some would reconsider appointing new staff if someone left.

Mr Axiom said he was able to negotiate a 10 per cent decrease in the government's valuation of his property, though even after that his rates bill would still triple over three years from 2017.

"The whole of Melrose Drive basically got revalued last year, affecting basically all motor dealerships on the strip, and our land values have risen by about 278 per cent in value, and with the changing rates formula, it's led to about a 300 per cent increase in rates," he said.

"There's certainly talk about moving to Queanbeyan because it's outside of ACT, and talk of moving to Fyshwick but we’re in an automotive hub, it’s a convenient location for our ACT customers so getting up and moving is not easy."

Mr Axiom also said that as the area was specifically zoned for car dealerships, there was little to no way of dealers being able to capitalise on the increased value of the land, instead he said they were left footing the bill.

ACT revenue commissioner Kim Salisbury told the committee the office revalued the properties due to sales in each area suggesting the valuations were lower than they should have been, highlighting areas undergoing increasing residential development.

Analysis of the effects of the changes showed valuations of 75 blocks in Braddon rose an average of 41 per cent, rising from a total of value of $220 million in 2016 to $310 million in 2017, up about $1.2 million per block.

In Civic and Turner [south of Haig Park], 80 properties were revalued, increasing the total value of those blocks from $517 million to $639 million, a 23 per cent increase, an average increase of $1.5 million per block.

And in Fyshwick, 48 properties were revalued, sending the total value of those blocks up from $55 million to $77 million, or about 39 per cent, an average increase of $460,000 per block.

Committee chairwoman also raised some problems in Braddon, where property owners had faced rate rises due to revaluations in 2016 that the government back-dated five years, with owners left to foot bills of up to $600,000.

Under-treasurer David Nicol said those cases were windfall for the territory budget and said it was a problem where the government should have simply revalued the property five years earlier, rather than missing it at the time, then back-dating valuations.

Mr Axiom said car dealers were not looking for any sympathy, but they wanted a fair go and for the government to reconsider the increases.

He said: "We always plan for rates increases each year, but no business can plan for a 300 per cent increase in their rates bills."