Tamworth events levy: who pays for it and why council introduced it

Tamworth Regional Council will apply to rates umpire, the Independent Pricing and Regulatory Tribunal (IPART) for a 6 per cent hike over four years.

It’s not the first council to apply for such a levy, Lismore Council has a special business rate levy extended for five years to fund its city centre revitalisation program.

Only commercial property owners will be subjected to the rate hike that’s expected to raise the council an extra $400,000 in four years.

The council collects three types of rates – rural, residential and commercial – and it’s essentially a tax on land.

“The reasonable and equitable way to levy this rate was against business ratepayers,” Tamworth mayor Col Murray said.

“The owners of the premises will be levied the rates and will likely be seeking to pass the cost onto their tenants.”

For example, plumbers who run their business out of the garden shed will not have to pay the levy – but someone who owns a building on Peel Street and rents it out to a business owner will. It really comes down to who owns the commercial land.

The tax will be applied right across the region, so commercial property owners in Barraba, Manilla, Nundle and everywhere in between can expect to fork out the funds.

Read also: City’s ‘country hick’ reputation makes it hard to attract events

Residential ratepayers cough up the industry average in rates, while Tamworth’s business rates are significantly lower than other places.

The council claims that even with the levy applied, Tamworth’s business rates would remain 20 per cent lower than similar areas.

It’s an aspect that makes Tamworth an attractive place to invest, but Cr Murray isn’t concerned the increase will affect stakeholders coming to the region.

“For the potential benefit I believe it is reasonable, I know exclusively almost every ratepayer would say it’s not and that’s not unreasonable to expect,” he said.

“But a councillor’s responsibility is to the whole community, we are losing events now that bring a lot of revenue to town.

“There are weekends where the motels and hotels are empty, the restaurants are down, the whole sector is very quiet and this has the potential to fill in those gaps.”

Businesses are expected to benefit most heavily from the new events and that’s why they were chosen to pay for the levy.

There has been significant debate over the events levy with many in the sector concerned they won’t see a kick back for their money.

But, not everyone is in opposition to it.

Butcher Rodney Cecil has owned Manilla Meats for two decades, he’s hopeful the rate will bring economic benefit to the outlying towns especially because of the effect of drought on his business.

“I’m not against it,” he said.

“I mean it’s only fair they charge everyone, something may not happen in Manilla but the smaller places should get their share of it.

“It’s not a big amount of money, you might not benefit but someone else in the town might.”

If the rate is approved by IPART, it will come back to council for a final vote before it’s imposed on commercial property owners.

A decision is expected by mid-May, the first payment will not be until July 2020.

Unconvinced the rate will have a benefit to her businesses is Jo McCulloch.

With a mechanic workshop, bulk transport and truck wash out near the airport – her business is a 95 per cent agriculturally based transport company.

“The drought has had a major effect on us, I feel the council are poorly managed and are very unfair to businesses in Tamworth,” she said.

“They have the ability to waste our money on stupid projects, for example Fitzroy Street.

“If the extra 6 per cent was used for a much, much larger dam I think everyone would agree with that.”

Not exactly.

The funds raised by the events levy will go into a dedicated account for new event attraction only – there will be no net benefit to council from the money businesses pay.

A committee made up of councillors and experienced business people will be drafted to decide exactly what new events council will chase.

Significant modelling has been done on which events are most likely to make the biggest bucks Cr Murray said.

“There will be a methodology applied to all applications and some won’t cut the mustard,” he said.

“Our internal economist has done extensive modelling on numbers from Destination NSW on visitor spends, business conference tourism is valuable and has a higher spend than sports tourism.

“It’s not about us getting fat and happy on some new money it’s about us being able to attract new money into our regional economy.”

The decision was made on Tuesday to apply for the special rate variation, with the amount slashed from 9 per cent across three years to 6 per cent across four to lessen the impact on local businesses.

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