Ratepayers to fork out after court ruling creates a ‘Meriton tax’
IF you live in a suburb with high rise apartments prepare to pay a “Meriton tax”. That’s the warning from local councils who say a landmark court decision is forcing them to squeeze ratepayers even more.
NSW
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IF you live in a suburb with high rise apartments, you are probably going to be hit with a “Meriton tax”.
That’s the warning from councils, who claim a landmark court decision will force them to pass costs on to ratepayers.
Businesses and residents within the City of Sydney are being forced to fill an $11.7 million budget hole created after a trio of councils lost a court case last year against apartment developer Meriton.
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The NSW Land and Environment Court decision, currently under appeal, means developers will pay significantly less council rates when high-rise properties are under construction.
With councils unveiling their budgets for the financial year ahead, that monetary burden has now shifted to ratepayers and businesses.
As a result of the case, Bayside Council has already lost $1.68m to developers and stands to lose about $1m every year.
Local Government NSW President Linda Scott said the problem could soon hit other councils.
“This decision has the potential to affect all metropolitan councils and many regional councils,” Ms Scott, who is also a City of Sydney Labor councillor, said.
“As a result of this decision, many councils may be forced to increase rates.
“Ratepayers of Sydney will soon be paying a Meriton tax.”
A City of Sydney spokesman also said the case has significant implications for other councils, “mainly that property developer making money from a parcel of land can boost their coffers while paying the same rates as people living there”.
“We don’t think that’s fair and that’s why the City and the other two councils are challenging the decision,” he said.
The appeal was heard in July and a decision is imminent.
Budget documents tabled at the City of Sydney council meeting on Monday night reveal residential ratepayers will fork out between $12 and $221 more in the 2018/19 financial year.
CBD businesses will fork out $2432 more in 2018/19, while businesses outside that zone will pay $6172, an average increase of $698.
The council will pay back the money if they win the court case on appeal.
But City of Sydney Liberal councillor Christine Forster said the council should absorb the cost, pointing to the ballooning cost of the cloud arch sculpture.
“If we can afford to spend $11m on a piece of public art we can afford to not slug ratepayers more,” she said.
“We are council which is so financially strong. We have $600m in the bank.
“Rather than slugging ratepayers it would be better if we absorbed the cost.”
A Meriton spokeswoman said: “The councils refused to refund what was owing to us, even though they never argued that we overpaid”.
“The Land and Environment Court agreed with us and the councils paid what was owed immediately upon the court’s judgment.
“They are now appealing, saying that they don’t have to repay what is ours. We had similar cases with other councils who immediately paid what was owing.”