XN000022-1994-03-30 — Page 39

6

WEDNESDAY, MARCH 30, 1994

HE FOUND IT DIFFICULT TO ACCEPT COMMENTS BY MEMBERS THAT THE ENVISAGED RATES INCREASE WOULD BRING TOO MUCH OF A BURDEN ON THE GENERAL PUBLIC, SET AGAINST RISING REAL WAGES, AND THE MINIMAL TAXES THAT MOST OF THE POPULATION ENJOYED.

IN THE LATEST REVALUATION, THE AVERAGE INCREASE IN THE RATEABLE VALUES FOR ALL CLASSES OF PROPERTIES · IS 33%, WHICH REFLECTS THE INCREASE IN RENTAL VALUES OVER THE THREE YEARS TO JULY 1993.

THIS PERCENTAGE HAPPENS TO BE IN LINE WITH INFLATION OVER THE PAST THREE YEARS, AND WELL BELOW THE RISE IN PROPERTY PRICES.

MOREOVER, THE ANNUAL ADJUSTMENTS IN 1994/95 AND 1995/96 EACH BE CAPPED AT 20%, SO THAT THE FULL IMPACT OF THE NEW RATES BE SPREAD OVER THE COMING THREE YEARS.

PUBLIC HOUSING TENANTS, WHO ACCOUNT FOR AS MUCH AS 42% OF POPULATION, WILL NOT BE DIRECTLY AFFECTED IN PRACTICE, BECAUSE HOUSING AUTHORITY FOLLOWS THE POLICY OF SETTING RENTS BY REFERENCE TENANTS' AFFORDABILITY.

WILL WILL

THE

THE

TO

SIR HAMISH SAID THE CURRENT OVERALL PERCENTAGE CHARGE AT 5.5% WAS HISTORICALLY LOW.

"AND WE ARE NOT PROPOSING TO INCREASE IT.

"BACK IN THE SEVENTIES, AS SOME OF YOU MAY RECALL, THE OVERALL CHARGE WAS AS HIGH AS 17%. RATES ONLY TAKE UP ABOUT 2% OF THE AVERAGE HOUSEHOLD INCOME. FOR BUSINESSES, RATES REPRESENT 0.2% OF THEIR OUTGOINGS, HE SAID.

THE PLAIN TRUTH IS: THIS IS A MODEST MEASURE WHICH STRIKES A BALANCE BETWEEN MAINTAINING THE REAL WORTH OF A STABLE REVENUE SOURCE. AND GIVING DUB WEIGHT TO EASING THE IMPACT ON RATEPAYERS, HE SAID.

"I SHOULD EMPHASISE THAT IN CONSIDERING A TAX CONCESSION, THE GOVERNMENT'S FISCAL POSITION IS IMPORTANT, BUT IT IS BY NO MEANS THE

ONLY CONSIDERATION.

"AND WHEN I SAY THE GOVERNMENT'S FISCAL POSITION, I DO NOT MEAN OUR SURPLUS OR DEFICIT IN ANY ONE YEAR, BUT OUR OVERALL FINANCIAL HEALTH DURING THE FORECAST PERIOD.

"AFFORDABILITY ASIDE, WE ALSO NEED TO TAKE INTO ACCOUNT THE IMPLICATIONS OF THE PROPOSED MEASURE ON OUR TAXATION SYSTEM, HE SAID.

HE SAID TO MAKE FISCAL DECISIONS ON THE BASIS OF THE SURPLUS OR DEFICIT FIGURES FOR A SINGLE YEAR WAS NOT WISE.

"TO ARGUE то DELAY THE IMPLEMENTATION OF THE LATEST RATES VALUATION OR TO REDUCE THE OVERALL PERCENTAGE CHARGE, SIMPLY BECAUSE HAVE PROJECTED A MODERATE SURPLUS FOR NEXT YEAR, IS I SUGGEST TO TAKE A VERY SHORT-TERM VIEW.

WE

0

17