The possible inclusion in the new Valuation Bill of bed & breakfast establishments, chicken farms and piggeries, has yet to be decided on by the Government, according to the Minister of State for Finance, Mr Martin Cullen.
"The B&B issue is an issue for Cabinet," said Mr Cullen. "There are a whole range of issues with regard to B&Bs and the Valuation Bill." He said there was "a mixed bag" of B&B establishments, some of which were registered, while others were not. Should B&Bs be included, all would have to be registered, said Mr Cullen. That, however, was a matter for the Department of Tourism and Sport.
While the hotel industry has made no secret of its desire to see B&Bs included in the commercial rates net, many B&B operators claim they run their businesses for certain months of the year only and could not afford a rates fee.
Were B&Bs included, it is believed that rates would be payable on the commercial portion of a property only. This would be similar to the manner in which doctors who work at home pay rates on their surgery but not on the domestic part of their house.
Mr Cullen said the Department of Environment and Local Government had expressed concern that "some forms of intensive farming" should be subject to rates under the new Bill. This would include "narrow-focus intensive-farming activities such as chicken farms and piggeries".
While this is being considered, it is believed unlikely that the Bill will include such a provision. Rates on agricultural land were abolished after a Supreme Court decision in 1984.
Local authorities will continue to set a rate and collect rates under the new system, although Mr Cullen has said it will be capped.
As it stands, the authorities are no slouches when it comes to collecting rates. According to a recent report by the Chambers of Commerce of Ireland, commercial rates collected increased by 50 per cent in 1990-1999 at a time, the chamber says, when aggregate inflation was 21 per cent. Some £230 million (€292 million) was collected in commercial rates in 1989, says a Chamber of Commerce report. The figure this year is expected to reach £411 million.
"One pound in every four in current expenditure comes from commercial ratepayers. In spite of significant increases in funding from central government for local authorities over the last few years, councils and corporations across the country continue to hike upwards the business rate," said the Chambers of Commerce.
Any increase should only be permitted after consultation between the local authority and the business community, it said, calling for a system of "universal local revenue collection offset against national taxes".
For its part, a draft report prepared for the Small Firms Association by Dr Con Power Business Consultants proposes that "all funding of local authorities should be by the general taxpayer and be either directly from or otherwise through the Exchequer".
Citing the increase in rates paid since 1990, the report said "industrial and commercial ratepayers underwrite the projected deficit between [local authority] expenditure and other income".
