By JAMES GARDINER
Poll taxes, local gst and income taxes are being contemplated as politicians seek alternatives to property rates and new ways to finance councils.
Two reviews of laws covering district and city councils and how they raise money have begun.
The Ratings Power Act 1988 has been under scrutiny since 1998 and the Government last month issued a policy statement for reviewing the Local Government Act 1974.
It intends to change the laws over the next two years. Local Government Minister Sandra Lee yesterday refused to rule out out any new taxes for councils but indicated that property tax (rates) would remain the "principal revenue base."
A A Local Government Association policy analyst, Raymond Horan, said extra taxes to finance local bodies, such as income tax or an additional goods and services tax, were likely to be considered as part of the Local Government Act review.
The annual rates take is around $2.2 billion but law covering where money comes from is complex and expensive to enforce, often leading to litigation.
Some councils are facing public furore over rate rises.
Although councils believe the funding review will lead to law changes allowing them to introduce more user-pays charges, there is already concern that it will not be enough.
Gisborne, scene of an unprecedented protest march last weekend by 3000 people angry at rate rises, is a council that cannot raise the revenue it needs.
Mayor John Clarke said the council provided services to 45,000 people in a large district but had fewer than 20,000 ratepayers.
A tax levied on all registered voters could work, he said. "The guts of it is that Government has withdrawn from local areas and placed a whole lot more social responsibility by default on councils that simply can't afford to do it."
Poll taxes target every adult, regardless of means. Proponents argue they are a fairer way of ensuring that everyone who gets the benefit of free or subsidised amenities and services, such as libraries and parks, contributes.
Federated Farmers has been pushing that argument for some time, saying land-based rating is unfair because it results in anomalies whereby some farmers pay close to $500 each a year to maintain regional parks, while urban homeowners pay less than $20.
Mr Clarke said councils were looking forward to the greater flexibility "to develop funding scenarios that perhaps better suit their particular location."
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