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VFI calls for commercial rates reform

The VFI has called for reform of the commercial rates system, believing it to be punitive and a heavy burden on businesses throughout Ireland.

It’s also costing jobs in the current climate, claims VFI President Gerry Mellett who stated, “The commercial rates system may be a major income stream for local authorities but it is not calculated in a fair and even-handed way or in a manner that encourages small businesses to operate.

“Local authorities seem to be oblivious to the fact that the relentless pursuit of small businesses is leading to significant job losses and will result in less rates being collectable as these businesses go out of existence. Authorities should be seeking to find a system that takes account of ability to pay and is based on reality.”

Currently, every commercial property in the country has a commercial valuation set by the Central Valuation Office in Dublin. When passing the local authority budget for the year, local councillors determine the multiplier to value commercial properties. This system is flawed and outdated, claims the VFI. A fairer system based on income and turnover categories would be favoured by many small and medium-sized businesses as it is a realistic appraisal of their ability to pay.

Gerry Mellett added, “Our members, and more particularly the 35,000 people employed by them, are dismayed that no political party has addressed the issue of commercial rates in their election manifestoes. It would appear that they do not understand the obstacles the current system is creating for on-going employment levels.
 
“Businesses throughout Ireland are united against this current system of commercial rates which is now outdated and causing huge difficulty. The current system is based on commercial value rather than how a business is operating or coping financially and we call for a full review of this system.

“We fully appreciate local authorities need to generate revenue in order to operate essential services but there needs to be a fairer way of generating this money.”

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