WELLINGTON, Aug. 25 (Xinhua) -- The New Zealand government will cap annual council rates increases at an initial target range of 2 to 4 percent under proposed legislation aimed at keeping local taxes affordable for households and businesses, a senior official said on Tuesday.
Ratepayers nationwide have been hit with median increases of 14.2 percent and 9.2 percent over the past two years, respectively, adding pressure to household budgets, Local Government Minister Simon Watts said in a statement.
Under the proposed system, councils would be required to keep annual rates increases within the target range, which would be reviewed every six years to reflect costs outside councils' control.
Limited, time-bound exemptions would be available in exceptional circumstances, such as recovering from natural disasters, or where councils could demonstrate prudent financial management and a justified need to operate outside the range, he said.
Water services would be excluded from the system and regulated separately, the statement said.
The legislation would also establish an independent regulator to monitor compliance, assess exemption applications and advise on future target ranges, it said.
Councils will need to consider the target range from July 1, 2027, when preparing their long-term plans, with the caps to take full effect from July 1, 2029. ■
