Damon Mcknight
Council rates are a form of property tax levied by local governments in Western Australia to fund essential community services and infrastructure. The rates are calculated based on the value of the property and are used to cover the cost of providing facilities and services such as waste management, recreational facilities, roads, and libraries. Each local government determines a 'rate in the dollar', which is then multiplied by the assigned value of the property to calculate the council rates. This rate in the dollar is influenced by the council's expenditure requirements and income from other sources, such as grants and fees for services.
| Characteristics | Values |
|---|---|
| Basis for Calculation | Value of the property |
| Rate Calculation | Property valuation multiplied by the rate in the dollar set by the council |
| Annual Budget | Based on the council's expenditure requirements, both operating and capital, offset by other income such as grants and fees for service |
| Rate in the Dollar | The total amount of money to be raised in general rates is divided by the total value of all rateable properties in the area |
| Types of Rates | General rates, differential rates, specific area rates, minimum rates, interim rates, back rates, ex-gratia rates, and service charges |
| Local Government Revenue | Rates, fees and charges for services, grants from state and Commonwealth governments, property-developer contributions, and sales of assets and property |
| Emergency Services Levy | Gross Rental Value multiplied by the Department of Fire and Emergency Services (DFES) Rate in the Dollar |
| Waste Service Charge | A separate charge is levied for waste services provided by the council |
| Payment Options | Ratepayers can choose to pay in one, two, or four instalments |
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What You'll Learn
Council rates are calculated based on property value
The formula for calculating the rates for an individual property is the property valuation multiplied by the rate in the dollar set by the council. For example, if the Capital Improved Value of a property is $250,000 and the council rate in the dollar is set at 0.42 cents, the rate bill would be $1,050 ($250,000 x 0.0042). Councils break up the total rates revenue they wish to collect by distributing the burden across all rateable properties, depending on each property’s value in relation to all other rateable property values in the municipality.
In Western Australia, rates are a tax on property levied by local governments to fund the shortfall between their planned expenditure and all other income they receive, including from local government grants. The Local Government Act 1995 and the Valuation of Land Act 1978 prescribe the methods for assessing the rateable value of property and the types of rates that can be levied. Each local government determines a rate in the dollar, which is multiplied by the assigned value of the property.
The Gross Rental Value (GRV) of a property is determined by Landgate Valuation Services. The Emergency Services Levy is calculated by multiplying the Gross Rental Value by the ESL Rate in the Dollar. A separate charge is levied for a Waste Service, which covers the cost of a weekly 240-litre household rubbish pickup and a fortnightly co-mingled recycling pickup.
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The Gross Rental Value (GRV) is used
Council rates are a contribution each ratepayer makes towards the cost of providing facilities and services to the community. The Gross Rental Value (GRV) is used as the basis for calculating how much each property owner pays in rates. The GRV is determined by Landgate Valuation Services, and it reflects the rental value of a property. The higher the GRV, the higher the council rates.
The GRV is multiplied by the rate in the dollar set by the council to calculate the rates for an individual property. For example, if the GRV of a property is $26,104 and the council rate in the dollar is 0.077667, the annual rate bill would be $2,025.81 ($26,104 x 0.077667). The rate in the dollar is determined by the council's annual budget and is based on the city's expenditure requirements, offset by other income such as grants and fees for service.
The GRV is also used to calculate the Emergency Services Levy (ESL), which is a separate charge levied by the Department of Fire and Emergency Services (DFES). The ESL is calculated by multiplying the GRV by the DFES Rate in the Dollar. For example, if the GRV is $26,104 and the DFES Rate in the Dollar is 0.015216, the ESL would be $397.20.
The GRV is usually updated every two years, and it can increase or decrease depending on various factors such as market conditions, property improvements, and changes in the local economy. Property owners have the right to review and appeal their property's GRV if they believe it has been assessed inaccurately.
Overall, the GRV plays a crucial role in determining the council rates and related charges for a property in Western Australia. It ensures that each property owner contributes fairly towards the cost of providing community facilities and services based on the value of their property.
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Councils also impose service charges
Councils may impose service charges for specific services, such as waste collection and disposal. For instance, the City of South Perth levies a separate charge of $430 for each waste service provided annually, which includes weekly household rubbish pickup and fortnightly co-mingled recycling pickup.
Additionally, special rates or charges can be applied to particular services or projects, such as roads, footpaths, kerbs, channels, or drains. These charges may also be used for promotional, marketing, or economic development initiatives.
Another example of a service charge is the Fire Services Property Levy, which is collected with council rates in some areas. This levy funds vital equipment, firefighters, staff, volunteers, training, infrastructure, and community education.
Councils may also levy a municipal charge, which is a flat fee that helps offset administrative costs. This charge is limited to 20% of the total amount raised from the combination of municipal charges and general rates.
These service charges are separate from the council rates, which are calculated based on the value of the property and used to fund community infrastructure and services.
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There are different rates for different land categories
Council rates are calculated based on the value of the property. The rates are used to fund the cost of providing facilities and services to the community, such as the maintenance of parks, library services, roads, health, and recreational facilities. The Local Government Act 1995 and the Valuation of Land Act 1978 prescribe the methods for assessing the rateable value of property and the types of rates that can be levied.
The formula for calculating the rates for an individual property is the property valuation multiplied by the rate in the dollar set by the council. For instance, if a property is valued at $250,000 and the council rate in the dollar is 0.42 cents, the rate bill would be $1,050 ($250,000 x 0.0042). Property values are typically calculated every two years.
In addition to general rates, there may also be special rates or charges for specific projects or services, such as waste management, footpaths, roads, or promotional activities. These additional rates vary depending on the specific services provided by each council.
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Councils raise money through rates to fund services and projects
Councils in Western Australia raise money through rates, fees, and charges for services, as well as grants from state and Commonwealth governments. They also receive funding through property-developer contributions and sales of assets and property. These rates are a form of property tax, with the value of each property used as the basis for calculating how much each property owner must contribute. Councils collect this money to fund essential services and projects for their communities.
The Local Government Act 1995 and the Valuation of Land Act 1978 outline the methods for assessing the rateable value of a property and the types of rates that can be levied. Each local government determines a rate in the dollar, which is then multiplied by the assigned value of the property. This rate in the dollar is calculated by dividing the total amount of money to be raised in general rates by the total value of all rateable properties in the area. The resulting figure is then applied to the assessed value of each property to determine the amount to be paid in rates.
The money raised through rates funds a range of services and projects, including the maintenance of parks, library services, roads, health, sanitation, building control, and recreational facilities. Councils may also use the funds for new infrastructure and upgrades to existing infrastructure, such as river walls, roads, paths, and drainage.
In addition to general rates, there may be special rates or charges for specific projects or needs. For example, a municipal charge may be levied to offset administrative costs, or a fire services levy may be collected to fund emergency services. These additional charges are included in the total rates paid by property owners.
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Frequently asked questions
Council rates are a property tax levied by local governments to fund the shortfall between their planned expenditure and all other income they receive. Council rates are a contribution each ratepayer makes towards the cost of providing facilities and services to the community.
The formula for calculating the rates for an individual property is the property valuation multiplied by the rate in the dollar set by the council. For example, if the Capital Improved Value of a property is $250,000 and the council rate in the dollar is set at 0.42 cents, the rate bill would be $1,050 ($250,000 x 0.0042).
The value of each property is used as the basis for calculating what each property owner will pay. Councils consider community needs in relation to their available income for the coming year when deciding how much they need to raise in general rates. Other factors include the types of rates that can be levied, such as differential rates for different categories of rateable land, and the availability of other income sources like grants and fees for services.
