The City of Launceston is strongly encouraging landlords of commercial properties to pass on new rates reductions to their tenants in the form of rent relief, as business uncertainty continues to mount in the midst of the COVID-19 pandemic.
As part of the council's $8.5 million Community Care and Recovery Package, a rates remission will be provided to eligible commercial property owners, with the expectation that the associated savings will be used to ease the financial burden on struggling small businesses.
Mayor Albert van Zetten said landlords couldn't be forced to do this but that it was the council's view that they had an "obligation" to do so.
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"Quite a few people who are renting have agreements with their landlord and they pay the rates anyway," Cr van Zetten said. "But there will be some that don't."
"[Council is] really trying to do the part that we can to ensure that [rates aren't] an extra burden on a business as it's operating.
"And what we all want to see is, in the next two-three months, however long it has to be, that there is a business at the end of it and you still have somebody in your building if you're ... a landlord so we want to make sure that we can do our bit."
Real Estate Institute of Tasmania president Mandy Welling said taking financial stress off commercial property owners, especially when they themselves ran businesses of their own out of the premises, was welcome.
"[It] leaves the owner of the property in a bit more of a position where they can negotiate the terms of the arrangement," she said. "So I think when everyone's just taking and giving a fraction, it just makes it that much easier to try and accommodate everybody."
Ms Welling said it would be a "wonderful scenario" if landlords were able to pass on the benefit of reduced rates to their tenants but that it came down to an "individual perspective".
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"It is terribly, terribly important for us to work together," she said.
Launceston Chamber of Commerce chief executive Neil Grose said the rates remission would offer "medium-term relief" for small business owners.
"[It's] really important to commercial tenants who are doing it tough," he said. "Over the next two-three months, that issue of rates and what they cost will be really important."
"All we can do is encourage landlords to pass on 100 per cent of [their rate relief].
"It's to help businesses get through this so it seems only fair that that gets passed straight on to the tenant."
Commercial properties eligible for the rates remission include restaurants, cafes and retail stores, while supermarkets, shopping centres, bottleshops, churches, banks and more will not be eligible.
However, Cr van Zetten said this didn't preclude ineligible property owners from applying for rates relief via a different channel.
An interim rates and charges hardship policy has been introduced, which will allow many ratepayers suffering genuine financial hardship to access relief from having to pay rates, charges and interest.
It's really trying to do the part that we can to ensure that that's not an extra burden on the business as it's operating.
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