Understanding rates and revaluations

Almost everything you see from your front gate is provided by councils. From the footpath, street lights, roads and bins to the parks, gardens, sports facilities and childcare centres. They remove your waste, provide free libraries, immunise babies and deliver meals to the homes of older people.

To view a breakdown of how rates are spent view our Budget at a Glance Brochure(PDF, 440KB).

Rate capping overview video

To find out more about how rate capping works watch this video from the Municipal Association of Victoria (MAV) below.

A council’s overall rate revenue must not be more than the rate cap from last year. The rate cap does not apply to individual rates notices. The overall rate revenue collected by a council cannot exceed the rate cap, but how much each property owner pays is determined by the value of your property. The Victorian Government also excluded waste charges and the state’s fire services property levy from the rate cap.

Councils do not receive extra money when property values rise as the change in valuations is accounted for when setting the annual budget. Some ratepayers will pay less than the rate cap and others will pay more due to individual valuation shifts, but the overall general rates collected by a council won't exceed the rate cap.

Council takes the total rate revenue to be collected and divides it by the total value of all properties in its municipality to calculate the rate in the dollar. This ensures councils do not receive more money when property values rise.

The rate in the dollar is then multiplied by the Capital Improved Value of each property to ensure each ratepayer contributes a fair share.

Waste charges and the Emergency Services and Volunteers Fund (ESVF) are then added to your general rates notice to determine the total amount you will pay.

Rating differential principles

The Local Government Act 1989 allows a Council to apply a differential rating system if it considers that the differential rate will contribute to the carrying out of its functions.

Council collects rates from residents and businesses in its municipality to help fund its local community infrastructure and service obligations. Council rates are a form of property tax. Council is committed to having a Revenue & Rating Plan(PDF, 890KB) that is underpinned by sound principles, which are well understood, communicated to ratepayers and compliant with current legislation.

Having a Revenue and Rating Plan requires Council to strike a balance between competing principles to come up with a mixture of rates and charges that provides the income needed for its annual budget while meeting the tests of equity, efficiency and simplicity. For the purposes of understanding how equity, efficiency and simplicity are applied in this situation an overview is provided.

• Equity, including both horizontal and vertical equity. Horizontal equity means that those in the same position e.g. with the same property value, should be treated the same. Vertical equity in respect to property taxation means that higher property values should incur higher levels of tax.
• Efficiency, meaning that in a technical sense the tax should not unduly interfere with the efficient operation of the Council. The tax should be consistent with the major policy objectives of Council.
• Simplicity for both administrative ease (and therefore lower cost) and to ensure that the tax is understood by taxpayers. The latter ensures that the tax system is transparent and capable of being questioned and challenged by ratepayers.

Rating Differentials

After reviewing the rating options for the current financial year, Council adopted the budget to include the following differential rating categories:

• Residential
  
• Commercial
• Industrial
• Petro-Chemical
• Vacant Residential Land

Review of differential rating category

You can request an internal review of the classification of your property by contacting the rates team on 1300 179 944 or customerservice@hobsonsbay.vic.gov.au if you feel it is incorrect.

If you disagree with the outcome of the review, you can appeal to the Victorian Civil and Administrative Tribunal (VCAT) under section 183 of the Local Government Act 1989.

Your appeal must be lodged with VCAT within 60 days of the date of issue of the annual rates, charges and valuation notice.

The Valuer-General Victoria (VGV) is the official authority responsible for all property valuations used by local governments across Victoria. Since1 July 2019, property valuations are conducted annually, with values determined as at 1 January each year. These valuations form the basis for your council rates and land tax assessments.

In certain circumstances, property valuations must be undertaken between general valuations. These are known as supplementary valuations and are required when properties are:

• physically changed (for example, when buildings are altered, erected or demolished)
• amalgamated
• subdivided
• rezoned
• portions are sold off.

We conduct supplementary valuations at regular intervals.

If a supplementary valuation is carried out on your property and the property value changes, you will be issued a letter advising of the amended rates and valuations.

Further information is available in the Supplementary Valuations flyer that is provided with all Supplementary Rates Notices.

Following the issue of Council's rates notice, formal written valuation objections must be made to us in relation to the values of a property, or on other grounds as specified in the Valuation of Land Act 1960.

If you do not agree with the property valuation once you receive your rates notice (issued in August/September each year), you can lodge an objection to the valuation. The objection period is only available within 60 days of the date printed on your rates notice.

Note: Please ensure that you are not adding any of the valuations together. Council uses the Capital Improved Value (CIV) as the basis of rating. This will include the value of land and any improvements on the land.

Objection form

Objections can now be made online. You will require a copy of your rates notice to be able to object online. (Please note: it is recommended for use with Firefox or Google Chrome only).

Objection process

Upon receipt of an objection, the valuer appointed by the Valuer-General Victoria (VGV) may discuss the matter with you and either allow or disallow the objection.

If you are not satisfied with the decision, you may appeal to the Victorian Civil and Administrative Tribunal (VCAT), or the Supreme Court. The Valuation of Land Act 1960 sets out both the valuer's responsibilities and yours, as the objector.

Payment of rates and charges

If you object to a valuation, you must still ensure the rates and charges are paid by the due date. Failure to pay by the due date will result in interest charges.

Valuation objection outcome

Council must wait for the Valuer-General Victoria (VGV) to officially confirm the change in valuation as advised by the valuer before we can use a valuation.

Upon confirmation we will send out an amended rates notice. Any changes to the rates and charges in your favour shall be credited back to the rate assessment. Any credit amounts will remain on your rate assessment and a refund will only be issued on your written request.

The emergency services and volunteers fund (ESVF) has been introduced by the Victorian Government to replace the fire services property levy.

For further information about the ESVF, please visit the Emergency Services and Volunteers Fund page.

Following the issue of Council's rates notice, formal written valuation objections must be made to us in relation to the values of a property, or on other grounds as specified in the Valuation of Land Act 1960.

If you do not agree with the property valuation once you receive your rates notice (issued in August/September each year), you can lodge an objection to the valuation. The objection period is only available within 60 days of the date printed on your rates notice.

Note: Please ensure that you are not adding any of the valuations together. The capital improved value is the value of the land plus any improvements on the land - thus already includes the site value.

Objection form

Objections can now be made online. You will require a copy of your rates notice to be able to object online.

Objection process

Upon receipt of an objection, the valuer appointed by the Valuer-General Victoria (VGV) may discuss the matter with you and either allow or disallow the objection.

If you are not satisfied with the decision, you may appeal to the Victorian Civil and Administrative Tribunal (VCAT), or the Supreme Court. The Valuation of Land Act 1960 sets out both the valuer's responsibilities and yours, as the objector.

Payment of rates and charges

If you object to a valuation, you must still ensure the rates and charges are paid by the due date. Failure to pay by the due date will result in interest charges.

Valuation objection outcome

Council must wait for the Valuer-General Victoria (VGV) to officially confirm the change in valuation as advised by the valuer.

Upon confirmation we will send out an amended rates notice.

Any changes to the rates and charges in your favour shall be credited back to the rate assessment. Any credit amounts will remain on your rate assessment and a refund will only be issued on your written request.

Should you receive a land tax bill from the State Revenue Office and wish to object to the site value please contact the State Revenue Office directly on 13 21 61 or submit an objection online. You have two months from the issue date on your land tax notice to object.