New financial year rates and charges
Information regarding the rates and charges for the 2022-23 financial year per the Hobart City Council.
Covering the fire service, waste management and the new landfill levy service charge, The Hobart City Council has shown a greater focus on green waste management practices with the release of their rates for the new financial year.
The Hobart Council area has been revalued which is done roughly every 8 years. These new values will mean that the assessed annual value figure, or AAV, will have gone up. The new values also increase the land value which again means the land tax is calculated on the new higher land value, which means more land tax to pay for investors.
Land tax is not charged to people’s primary residence.
When the council issues the new notices, property owners have the right to object to the values if they feel they are not accurate. This period only lasts 60 days however and appeals are received by lodging a formal objection notice, from date of issue.
Property owners should check the new values and ensure they are in line with what they believe they should be, but also to then cross check against the council rate and the land tax scale to work out what increase they will have for rates and land tax.
While you may not be a commercial property owner, many commercial investors pass on these rate increases to their tenants, which tenants may also want to keep an eye out for.
Most CBD properties are looking at a minimum 50% increase forecasted in the land values recently released, to that set by an indexation factor the previous year.
Below is the extract from the Valuation of Land Act, in particular the land value references. This is the main area where uncapped increases can cause issues, whereas the City of Hobart have already announced the capping of council rate increases for this financial year.
A General Rate of 10.50471 cents in the dollar of the AAV is applied to calculate your municipal rates. The General Rate has a maximum percentage increase cap of 2.6% for all rateable land in the municipal area except commercial, which is 1.6%.
Penalty and Interest
Penalty of 3% flat will be charged on unpaid instalments in accordance with section 128(1)(c) of the Local Government Act 1993 and thereafter interest at the rate of 8.13% per annum, charged monthly.
The Land Tax Rating Amendment Bill 2022 (TAS)
These measures will commence on 1 July 2022, which amends the rates and thresholds used in assessing land tax, as follows:
Increasing the tax-free threshold from $49,999 to $99,999;
Increasing the upper threshold from $399,999 to $499 999; and
Decreasing the rate applied to the $100,000 to $499,999 band from 0.55% to 0.45%. All local government rates are exempt from GST.
It is important for property owners to review these new values now as they will be the basis of your statutory property costs for the best part of the next decade. You only get one chance to object.
As the scale of both council rates and land tax can be changed by government and council it is recommended to be clear on these values. If you have any questions please contact our team.
Get in touch to find out how you can make the most of the new financial year rates.