Rural Rates: Fight for Fair

Rates are a major issue for farmers. We at the VFF strongly support farmers’ rights to differential rates relief under the current ratings system and supports mandatory rates relief on all farmland.

The VFF firmly believes a differential rate should be applied to all Victorian farmland. When applying differential rates, consideration must be given to the economic output of the agricultural industry in the local government area.

It is established VFF policy that:

Rating relief on farmland should be mandatory and rates should only apply to house and curtilage (the area of land attached to a house and forming one enclosure with it) 
Differential rates relief is mandatory for farmers
A Fair Go Rates Cap is essential, including a cap on individual categories of rates.

It is not enough for Councils to state they consider rates to be ‘fair and equitable.’ The VFF believes Councils must justify their policy to their voters.

Differential rating strategy exists to address inequalities in the land valuation method of determining rates. Changes to a rating differential have a direct impact on the business operations of farms and the community. 

The vast majority of rural shires in Victoria formally recognise the appropriate use of a differential as part of their ratings strategy. 

It is impossible for farmers to pass on rate increases commercially. This means that rates operate more like a fixed cost on business than a land tax.  

Rate increases must reflect the spirit and intent of the State Government’s policy of a Fair Go Rates Cap for all.

Farming is the only occupation dependent on a land asset base for earning an income. In reality, rating redistribution is a tax on businesses in the region and impacts on families. 

This is not an issue about urban and rural rates. All rate payers are at risk when Councils target a specific section of their revenue base and increase rates by redistributing the revenue sources.

Recent Events

In May 2017, the Ararat Rural City Council voted to abolish differential rating in favour of a uniform rate across all properties – be it residential property, commercial and industrial or farmland. Until now, farmland in this region has been rated using a differential rate system, which is based on a lower rate in the dollar.

The purpose of differential rates is to achieve greater equity or efficiency across ratepayers. 

Local leaders in the Ararat farming community have rallied together to lobby the Council to amend this decision. 

The VFF is providing support to the rural community of Ararat and has developed an action plan for all rural rate payers.

Lobbying by both the Ararat community and the VFF lead to the State Government announcing on Friday 23 June they would hold a Commission of Inquiry into the Rural City of Ararat’s rating strategy. The Minister for Local Government, The Hon Natalie Hutchins made the decision to appoint an inquiry and will announce process and participants in the coming days.The inquiry will report to government with recommendations by 1 August 2017. 

The VFF are actively assisting farmers in the Ararat area along with lobbying government for a more fair and equitable rating system.

Members can log in here to take action locally.