---
title: Impact of Minimum Rates
description: How important are minimum rates? In some areas, very important.
image: https://news.councilwise.com.au/hubfs/1718837956135.jpg
---

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How Rates Work

# Impact of Minimum Rates

How important are minimum rates? In some areas, very important.

[Scott Christian](https://news.councilwise.com.au/author/scott-christian)

 Jul 26, 2024

---

As a rates officer, dealing with multiple occupancies on a single property varies widely between state jurisdictions in Australia. How do you ensure a small apartment building on a Multiple Dwelling (or your state's equivelant) zoned block of land gets correctly rated? Quite a few factors go into this - are they seperately owned? Do they have differing uses (such as in a mixed use building with residential and commercial tenancies)? And what if I told you that a huge factor for some councils is whether a minimum rate has been declared?

As a number of our clients are councils in the Northern Territory, it may be of interest to those outside of the Territory how legislation there makes use of the concept of a "minimum rate" with regards to multiple occupancies. In fact, several of our clients are struggling with getting this put in place right now. Consider the following:

Council A is geographically enormous but a relatively small population centred in only a few small towns. They have never had a 'minimum rate' in their rating approaches. In one of their towns, there are some residential blocks of land where the owners have reacted to the dire shortage of housing by dropping 15 or 20 small units - "dongas" - onto the property, and have them rented out short or long term.

Unfortunately, the only option Council A has under the Local Government Act is to rate the property as a single occupancy. In order to rate each donga, they will need to put in place a minimum rate, which would then allow them to multiply the number of seperate occupancies by the minimum rate. You can imagine the dramatic increase in revenue - and we've visited towns in the outback where there are dozens of such blocks of land with dongas spread across them. This is a good reminder to rates officers to ensure their Rates Declaration for 2024/25 takes into account a minimum rate appropriate to their approach to rates for the coming year.

Rates can be a wild ride, and is endlessly fascinating. We know there are quite a few of you out there who feel the same! And next time you pass a member of your rates team in the holiday, share your appreciation for their passion!

[How Rates Work](https://news.councilwise.com.au/tag/how-rates-work)

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