Six per cent rise in rates is mooted

Westmeath County Council's top table is pushing for a 6% rise in commercial rates, it's emerged during preliminary discussions ahead of the budget meeting at the end of the month.

The move comes against a backdrop of an unchanged commercial rates last year, and the decision by the Fianna Fáil-led coalition in control of the council not to raise the Local Property Tax (LPT) in September, rejecting calls by Fine Gael and CEO Pat Gallagher to increase that charge by 15%, to bring in an extra €966,000. 
At that stage, Mr Gallagher warned that a rates hike of 6% was a likely scenario in the context of "increasing demands" on the council's budget in 2020 with Fleadh Cheoil na hÉireann happening in Mullingar, and commitments made to improve public lighting infrastructure and other projects in the county.
This time last year the commercial rates were left unchanged despite a 2.2% increase being sought by the local authority, on the grounds that small and medium sized businesses had suffered enough through the recent rates revaluation process, which resulted in many facing sizeable hikes in their annual rates bill in 2019. 
A rates rise in the coming year is likely to leave many businesses seething as they had to contend with difficult trading conditions in Athlone during the town centre enhancement works earlier in the year, and in Mullingar, where a similar scheme is still ongoing. 
Instead, the Fianna Fáil grouping, which hold the reins of the local authority with the support of the two Green Party representatives, has asked the council to examine putting in place a “progressive rates system” with a rebate to give a portion of the payment back to small businesses.
This would ensure any rise is “minimal” in practice, and, they say, is the backdrop for a figure of 6% being mentioned in initial budget discussions behind closed doors last month.
While the horse trading and hard negotiations have yet to take place in the context of detailed budget figures for 2020, some battle lines have been drawn as Fine Gael have signalled their opposition to such a jump in the rates burden on local businesses, while some in Fianna Fáil seem to be more accepting that they may have to rise the rates to balance the budget, albeit the grouping is proposing the rebate scheme which could see a percentage of the rates bill go back to businesses, if agreed. 
All sides stress nothing has been agreed yet but the news filtering out of a potential 6% rise in commercial rates has businesses up in arms and one source predicted there will be "war" if that goes through.

It's understood the party groupings are meeting within days to examine the situation in detail and firm up their positions ahead of meetings with the council's executive in the run-up to the budget meeting at the end of the month.
"I'd be totally opposed to rising rates. I don't think businesses should carry the can for not rising property tax," Cllr John Dolan (FG) told the Westmeath Independent this week. "In fairness, it's tough for businesses at the moment and any help we can give them, we should. I'd have no problem if the (rise) was spread across the board, I don't think it's fair for just businesses to carry the can," he added.
On the other side of the coin, sources in the Fianna Fáil grouping favour the move to what they are calling a “progressive rates system” where a business paying €1,000, with a 6% rates rise, would end up paying €1,060, and built in to this would be a percentage rebate or payback to businesses up to maximum of €250. 
When this is factored in, the business would get back €53 so their net increase would be just €7. 
For a business paying a €3,000 rates bill using this system should it be agreed, the net increase would only amount to €21, while the net increase for someone paying €5,000 would only amount to €50, the grouping claims, meaning that for most of the smaller ratepayers the effect would be minimal, something they are very conscious of amid tough trading conditions. The party grouping also argue it means that the smaller group of bigger ratepayers, for instance the dozen or so paying over €40,000 in the county, will be paying substantially more should the 6% rise be agreed – due to the cap on the rebate of €250. 
Fine Gael will oppose that level of rise but as it stands the numbers will be against them unless allegiances shift.
"In principle, I'm against any 6% rates increase. I did propose a 15% local property tax increase and that was turned down," Cllr Tom Farrell (FG) stated this week, adding that he had also suggested at that stage that the money could be divided equally between the Athlone Moate and Mullingar Kinnegad Municipal Districts and could be ring-fenced for particular projects.
The Fianna Fáil grouping points out it was against increasing the property tax to put the burden on the householder with increased living costs and a revaluing of properties due to take place next year.