Support for drop in commercial rates

CLARE County Councillors haven’t yet prepared the local authority’s budget for next year but at the November meeting of the council some members indicated their support for a drop in the cost of commercial rates.

In a joint motion, Councillors Gerry Flynn and James Breen asked Clare County Council to reduce the cost of rates to the business sector. They claimed the current cost is causing “huge hardship” and is unsustainable.
While no agreement was reached on reducing the rates burden, there was concern expressed by several members about the impact on struggling businesses.
In his written reply to the motion, the council’s head of finance, Niall Barrett, outlined some of the complications around reducing rates. “The total commercial rates income in the 2011 budget is €35.9m and is used to fund the general provision of services throughout the county. To introduce a reduction in the underlying rates multiplier for 2012 would require the identification of matching additional income sources and/or reduced expenditure budgets, as the council is required to produce a balanced budget. The consideration of a reduction in commercial rates for the county would have to be done in the context of the Budget process as the legislation specifies.
“There are approximately 2,075 commercial rates customers in County Clare; 84% (1,750) pay commercial rates less than €10,000 pa. A 1% reduction in commercial rates would benefit these customers by less than €100pa. This 1% would equate to the need to identify additional income or reduce expenditure budgets by €359,000. This represents 9% of the Roads Own Resources Budget, or all of the Housing Grant budget, or 10% of the council’s library services budget.”
Mr Barrett acknowledged that the introduction of the household charge next year could provide some additional funding to councils.
Speaking after the meeting, Councillor Flynn said he was quite pleased with the level of support he had received from his colleagues.
He also said he was hopeful the introduction of water and property taxes would ease the burden on business. Councillor Flynn said he felt the council should seek to restructure some of its payments claiming it was “squeezing business people out of survival for the preservation of Clare County Council”.
On Wednesday, Councillor Breen told The Clare Champion that change is badly needed. “Something has to be done for the ratepayer who is not making a profit. It would be different if things were buoyant but at the moment the costs are too high and small businesses are struggling.”