Dear Deputy

Revaluation 2017

You may be aware from the media coverage or contact with retail forecourt operators in your own constituency that there are serious ongoing issues with the current valuation process.

The revised commercial rates system has been in place now since 2017 and is currently undertaking the final phase, being phase 3 of the revaluation.

The Irish Petrol Retailers Association (IPRA) is the trade association for independent motor fuel retailers in Ireland. Our sector employs over 100,000 people and as many of our retailers are family businesses there are over 250,000 people dependent on the survival of this sector. Many of these are located rurally. We have major issues with the current commercial valuation system as it:

  • treats the shop portion of service stations unfairly in comparison to convenience stores and supermarkets;
  • demands financial data from service stations to calculate their valuation and bases the valuation of convenience stores and supermarkets solely on size (not turnover like service stations);
  • has been amended by the Valuation Office (showing the methodology was clearly incorrect to start with) following Phase 1 of the revaluation (phase 3 recently commenced) and these concessions do not apply retrospectively to those revalued under Phase 1.         

We believe the methodology designed and used by the Valuation Office for calculating the commercial rates payable by service stations is incorrect and unfair as our retailers are paying far more for the shop element of their service stations when compared with their competitors, being convenience stores and supermarkets local to them.

A short example is a 500M radius in Edenderry. Aldi has been valued at €114K, Lidl €161,300, Tesco Superstore €315K and yet the local service station (Mangans c.400sqm) has been valued at €145,600 (noting that all of these businesses are competing for the same customer footfall).

Interestingly, within this 500m radius a Tesco service station has been valued at €31,500. Given that Mangans is by far the smallest floor space (Tesco is the largest at c.5000sqm – over 12 times the size of Mangans) with a turnover a fraction of the multiples included here there is no way that anyone can claim that this system treats independently owned service stations fairly. This example is sadly, not unique.

As a trade association, our Members are not against paying rates but we do want a system that is fair and equitable and does unfairly penalise our sector. After 3 years of discussions with the Valuation Office and being dismissed repeatedly by Minister of State Phelan the IPRA was left with no choice but to involve DG Competition who are currently reviewing this issue from a state aid perspective.

We are writing to all Oireachtas members asking for their position on this issue so we can advise our Members in their respective constituency as this may influence their choice of candidate.

Please advise by return to office@ipra.ie so we can advise our members;

Do you support the setting up of a Rates Forum in order come up with a fair Rating system for all ratepayers? We look forward to hearing from you at your earliest convenience and are always available to discuss this or provide further information