Page 5082 - Week 13 - Thursday, 29 November 2018
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much more reasonable time. Now commercial rates have doubled—in some instances they have gone up fourfold—and the lessees are really struggling.
The lessees are often in a very difficult situation, because not only do they have a lease agreement that ties them to that property but often they have made improvements: they have done a shop fit-out; they have put in equipment; they have put in all sorts of expenditure to make that leased property work for their business. They are between a rock and a hard place; they are not mobile enough to leave, but they cannot afford to stay.
This is having a huge impact on the viability of businesses and property owners, and therefore the cost of products and services in the ACT. Therefore it is no wonder that businesses are choosing to go across to Queanbeyan rather than set up here in the ACT. That is a shame. It is a real shame that that is the case. The ACT should be trying to compete with New South Wales. Instead, we have surrendered. We have surrendered because the ACT government is trying to gouge as much as possible out of Canberra’s small businesses. It should not be this way, but it is.
I know of one situation that was before ACAT yesterday. The valuation for the property was $5.7 million. A year later, it was $24 million. The rates bill went up $1.2 million—$1.2 million! And the best bit is that the property got valued as a residential property but had commercial ratings factors applied to it. If it had had a residential rating factor, it would have been 0.6 per cent. Instead, using commercial ratings factors, it was five per cent. They got the worst of both worlds: a residential valuation and commercial ratings factors. If they had done the opposite, if they had had a commercial valuation and a residential ratings factor, the rates bill would have gone through the floor. Instead, it went through the ceiling because of this government’s policies. And do you want to know the best bit about this story? Guess who is the tenant of this building? The ACT government. The ACT government is a tenant of this building. It is absolutely outrageous. And this is a story that is happening across the territory.
I know of another small business, a small business in Phillip. It is not a car dealership. The valuation in one year, with no lease variation, went from $900,000 to $2.6 million. In one year! The valuation office did the rounds and said, “We can gouge you for more.” And that is exactly what they have done. That commercial property’s valuation goes up by $2 million at a five per cent ratings factor. That is another $100,000 per year that that small business has to pay. It does not matter what product or service you are talking about: when you need to fork out an additional $100,000, that has to have a hit; that has to have a big impact. One or two unskilled labourers that work in that business may have to be let go or one or two will not be hired. That is the real consequence of Mr Barr’s rates and tax policy. People are struggling. People are suffering.
It is all very well for Mr Barr to say: “This is the high end of town. This is the rich. These are property owners; these are landlords.” Every now and again, there might be instances where we are talking about a corporation, but the vast majority of commercial owners in the ACT would not be; they would be the small business people of Canberra that we depend upon.
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