Rate Capping

In October 2015 the Minister for Local Government announced the Fair Go Rates system, to take effect from 2016/17.

What is rate capping?

The Fair Go Rates system caps the increase to Council’s total revenue from general rates and the municipal charge to a figure based on the Consumer Price Index. Each year the Minister for Local Government will set the rate cap for the next financial year. A rate cap of 2.5 per cent for the 2016/2017 financial year was announced in December 2015, and applies to all Victorian Councils.

In circumstances where the rate cap is insufficient to fund the provision of services and infrastructure to the community Council can apply to the Essential Services Commission for an increase higher than the cap.

What does rate capping apply to?

The cap applies to Council’s total income received from General Rates and the Municipal Charge; it does not apply to waste charges or the Fire Services Property Levy.

Are my individual property rates capped?

Applying the rate cap is not this simple. Whilst the total revenue collected by Council from general rates and the municipal charge will only increase by 2.5 per cent, rate increases on individual rate notices will vary. As 2016 is a property revaluation year the allocation of rates will depend on how property values change. Therefore some properties will experience a rate increase of over 2.5 per cent, whilst others may see an increase less than 2.5 per cent.

Where can I find more information?

For further information regarding Fair Go Rates system, please visit the Essential Services Commission website.