Rating Strategy

Between 29 November 2023 - 2 February 2024, the City sought community and stakeholder feedback on an Options Paper to inform the development of a Rating Strategy for Hobart. A summary of the engagement results can now be found in the Community Engagement Summary Report.

At its April 2024 meeting, the Hobart City Council endorsed the new Rating Strategy. If you would like to read the report considered by Council, this can be found on the April Council Agenda (item 11).




Project background

The City of Hobart is reviewing its Rating Strategy to make sure we have a rating system that is fair for the whole City, sustainable, affordable for the community, easy to understand and supports ratepayers capacity to pay.

The rates we collect are a form of property tax. The value of a property is used to determine what each property owner pays. Rates fund essential programs, services and infrastructure for the community.

The City of Hobart has decided to change the property valuation base it uses for rating from Assessed Annual Value to Capital Value. While the Council has endorsed the change of valuation base, how the rating system is implemented is explored in an Options Paper. Community feedback is now being sought on the Options Paper.

The Options Paper:

  • Provides the community and stakeholders with information about rating
  • Addresses different rating systems including municipal charges and differential rating across different land uses (e.g. commercial, residential, industrial)
  • Proposes a number of options for how rates could be charged on different kinds of properties in the municipal area

You can download the Options Paper under the document section found on the right hand side of this page. You can also find the City's current Rates and Charges Policy in the same section.

If you would like to know more about the Rating Strategy, why we need to review it and how it will be used, you can read through the FAQs, which can be found on the right hand side of this page. You can also use the Online Q&A tool to ask us a question.


Engagement for this project was open from 29 November 2023 until 2 February 2024.




Between 29 November 2023 - 2 February 2024, the City sought community and stakeholder feedback on an Options Paper to inform the development of a Rating Strategy for Hobart. A summary of the engagement results can now be found in the Community Engagement Summary Report.

At its April 2024 meeting, the Hobart City Council endorsed the new Rating Strategy. If you would like to read the report considered by Council, this can be found on the April Council Agenda (item 11).




Project background

The City of Hobart is reviewing its Rating Strategy to make sure we have a rating system that is fair for the whole City, sustainable, affordable for the community, easy to understand and supports ratepayers capacity to pay.

The rates we collect are a form of property tax. The value of a property is used to determine what each property owner pays. Rates fund essential programs, services and infrastructure for the community.

The City of Hobart has decided to change the property valuation base it uses for rating from Assessed Annual Value to Capital Value. While the Council has endorsed the change of valuation base, how the rating system is implemented is explored in an Options Paper. Community feedback is now being sought on the Options Paper.

The Options Paper:

  • Provides the community and stakeholders with information about rating
  • Addresses different rating systems including municipal charges and differential rating across different land uses (e.g. commercial, residential, industrial)
  • Proposes a number of options for how rates could be charged on different kinds of properties in the municipal area

You can download the Options Paper under the document section found on the right hand side of this page. You can also find the City's current Rates and Charges Policy in the same section.

If you would like to know more about the Rating Strategy, why we need to review it and how it will be used, you can read through the FAQs, which can be found on the right hand side of this page. You can also use the Online Q&A tool to ask us a question.


Engagement for this project was open from 29 November 2023 until 2 February 2024.




Ask us a question about the Options Paper

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  • What properties are currently exempt from rates? Will they still be exempt from rates under the proposed changes? What is "rates loss"? Why can't we have meaningful figures using Capital Values instead of AAV? Does Council think that Its short-stray accommodation policy is working? Is it affecting the number of SSAs? Are there any other options to deter people converting properties to SSA? Should the LGA be amended to allow for other rating options? Why does introducing a fixed component mean that rates will be cheaper for higher value properties? Can we have meaningful comparisons?

    Eric asked 10 months ago

    Thank you for taking the time to ask a question.

    The only properties that are exempt from all rates are Council owned.  However, under section 87 of the Local Government Act 1993 (Tas), there are some property types exempt from the general rate component of Council rates.  These properties still pay service rates and charges, for stormwater removal, fire levy and waste management.  Examples of these property types are national parks, nature reserve, public park that provides free public access, is a road, a marine facility and charities that are owned and occupied exclusively for a charitable purpose.   The entitlement to the rates exemption is set out in legislation in section 87 of the Local Government Act 1993 (Tas) so even if a council changed its rating strategy the entitlement would remain the same as required under legislation.  All of the options outlined in the Option Paper are shown using the capital value of a property and the rating option using capital value.  As part of its interim rating strategy for 2023-24, the Council introduced a differential general rate for properties used as short stay visitor accommodation.  The objective was to ensure housing stock is retained but also to ensure that owners of residential land used for the commercial purpose of short stay visitor accommodation contribute to the provision of Council services and facilities that are associated with that commercial use e.g. economic development, tourism, communications and marketing.  This has been in place since 1 July 2023 and changes have occurred as a result.  The City would welcome a review of the current rating legislation to ensure that the rating system in the future is not only sustainable and can support programs, service and infrastructure needs but also ensures a fair and equitable distribution of rates across the municipal area. In distributing the rating burden the rating structure should include the following objectives:

    • fairness and equity for ratepayers
    • sustainable for councils and affordable for the community.
    • supports ratepayers capacity to pay; and
    • simple to understand and easy/cost effective to administer.

     

    The reason why higher value properties may pay less in rates if the Council introduced a fixed component of the general rates, is that part of the rate burden would be calculated as a fixed charge that everyone paid.  Thus reducing the amount to be paid using your property valuation, which would mean a lower rate in the dollar for all properties leading to reduced rates for higher valued properties.  The comparisons in Table 11 of the options paper show the impact of a $200 fixed charge on properties with different capital values and different land uses.

    If you would like any other information you are encouraged to contact the Rates Team on 03 – 6238 2787, email: coh@hobartcity.com.au or come along to a rates drop-in session.

Page last updated: 30 Apr 2024, 03:40 PM