Most Auckland firms will face big rates increases

For every dollar in rates paid by households, urban businesses are charged $2.63 and rural businesses $2.37. Photo / Thinkstock

About 8000 Auckland small businesses and 1700 large businesses face rates increases of more than 10 per cent for three consecutive years.

Unlike households, businesses do not have the luxury of a rates cap and have to change to the new single rating system for the Super City in equal steps over three years.

Seven out of 10 small businesses and six out of 10 big businesses face a rise in rates. About 11,000 businesses across the region will get a reduction in rates.

Auckland Mayor Len Brown said that while the value of rates being paid by business was being shuffled around, the 34 per cent of total rates collected from businesses was the same as under the former councils.

For every dollar in rates paid by households, urban businesses are charged $2.63 and rural businesses $2.37.

In the case of Pukekohe businesses, the council has set the differential at $2.03. This is because the former Franklin District Council did not charge a business differential and a $2.63 differential would have had a "significant and extreme" impact on those businesses, Mr Brown said.

The differential for urban businesses will be cut by 10c every year to reduce it to $1.63 after 10 years.

Auckland Chamber of Commerce chief executive Michael Barnett said the reduction in the business differential was a minor adjustment.

He said the council talked about achieving fairness and equity and easing ability to pay with its rating policies, but used business as a cash cow.

Orakei councillor and business advisory panel chairman Cameron Brewer said many businesses were being hurt with higher rates just when they did not need it.

Of the 24,000 businesses facing increases, 4410 were facing a rise of 50 per cent.

"We're only going to see more empty shops and empty commercial buildings," Mr Brewer said.

BUSINESS RATES

* Most businesses pay $2.63 for every $1 paid by households.
* Pukekohe businesses will pay $2.03.
* The $2.63 differential will be cut by 10c every year to $1.63 after 10 years.