How your rates are calculated

The total amount payable on your rates notice is made up of multiple charges, including your General Rates, Waste Service Charges, Municipal Charge and a Fire Services Property Levy. Some of these are fixed amounts while some are based on a percentage of the Capital Improved Value (CIV) of your property.

If you’ve ever wondered how general rates are calculated, there is a standard formula across Victoria.

When Council prepares its Annual Budget for the coming year, it determines the rate revenue required to fund its services and infrastructure. The budget considers community needs in relation to the available Council income and also how rate rises will impact ratepayers. All properties are valued at 1 January each year.

The 'rate in the dollar'

In broad terms, the total amount of money to be raised in general rates is divided by the total value of all rateable properties. The resulting figure is called the ‘rate in the dollar’. For example, if Council plans to raise a total rate revenue of $15 million, and the total Capital Improved Value (CIV) of all rateable properties in the Shire is $6 billion, then the rate in the dollar is calculated by dividing $15 million by $6 billion, which equals 0.0025 cents in the dollar.

When the total value of all properties goes up, Council reduces the rate in the dollar to compensate.

How property rates are calculated

We calculate a property’s rates by multiplying the Capital Improved Value (CIV) of the property by the rate in the dollar.

For example, if the CIV of a property is $400,000 and the Council rate in the dollar is set at 0.0025 cents, the rates would be $1000 ($400,000 x 0.0025).

Like other councils, Murrindindi Shire Council’s rate increases are limited to the Victorian Government’s Fair Go Rate cap

The rate cap is about the total rate revenue Council can collect, not individual property rates. The rate cap is applied to the total rate revenue raised in the previous year. In other words, we can only increase the total rate revenue required by a maximum of 2.75%, regardless of any increase in property valuations. The total rate revenue is distributed proportionally across properties in accordance with property values.

Waste service charges are calculated on a cost-recovery basis. This charge covers the costs of Council’s kerbside garbage and recycling collection services, waste disposal and the Victorian Government’s Landfill Levy – a charge Council must pay when depositing waste at landfill.

Waste service charges are applied to all residential and commercial properties (excludes vacant land) located within a compulsory waste charge zone (within 2 km of a township) or a delivery zone.

Like many other councils, Murrindindi Shire Council has elected to collect a portion of its rate revenue through a Municipal Charge, which is a fixed-cost paid equally by all ratepayers. This charge is included in the rate cap calculation with General Rates.

The Fire Services Property Levy is set annually by the Victorian Government, collected by councils and forwarded in full to the Victorian Government, to fund the state’s fire services.

In accordance with the Local Government Act, all properties across the Shire are valued annually by a qualified valuer appointed by the Valuer-General.

The valuer calculates the CIV of a property based on a combination of property sales analysis and rental evidence.

A revaluation redistributes the rates burden among ratepayers and does not result in any additional revenue to Council.

As a result of a revaluation, ratepayers will receive different rate increases dependant on the movement in valuation.

Municipal property valuations are governed by the Valuation of Land Act 1960 and are conducted annually. Ratepayers have a right to object to the valuation of their property but must lodge their objection within two (2) months of the date of issue of the original rates notice.

Once received by Council, your objection is referred to the valuer who will give you an opportunity to discuss your objection. 

Visit our How to lodge a rates/valuation objection page to learn more, or if you are ready to lodge an objection visit our Rates/valuation objection forms page.

The average general rate and the municipal charge will increase by 2.75%.

Council’s differential rates as of 1 July 2024 are:

• Rural 1 properties (not less than 40 hectares in area) - 70% of the general rate
• Rural 2 properties (greater than 4 hectares and less than 40 hectares in area) - 99% of the general rate
• Vacant land (as defined) - 200% of the general rate
• Commercial/industrial - 125% of the general rate

Council offers a subdivided vacant land differential rebate. Further information including details of eligibility criteria are available on the application form.

Updates to be processed after issue of Rate notice (August/September).

If an amendment is made to the valuation to include any changes to the property, additional costs could be payable, for which a Supplementary Rate Notice will be issued.

The State Revenue Office uses the site value to assess land tax under the Land Tax Act 1958.

Objections to the site value must be made to the State Revenue Office within the time limits prescribed under the Valuation of Land Act 1960.

A taxpayer does not have a right of objection to a council valuation arising from its use for land tax, which occurs at a later time than the use for council rates.

Further information on the use of valuations for land tax can be found by visiting the State Revenue Office website.