Calculating your rates and charges

See how the different charges that make up your rates and charges bill are calculated.

I want to

We’ve changed how rates charges are worked out to ensure a fair rates burden on residents. The new Rating Strategy (DOCX 882KB) will ensure that people are charged a fair contribution for services. There are three important changes in the strategy:

Changing from Net Annual Value (NAV) to the Capital Improved Value (CIV)
Differential Rating for residential, commercial and industrial properties
Separate waste charge

Changing from Net Annual Value (NAV) to the Capital Improved Value (CIV)

The NAV rating system saw rates distribution shifts from commercial and industrial properties to residential properties by up to $0.9 million since 2016/17, due to changes in property valuation. The valuation for the 2021/22 year saw commercial and industrial properties on average receive a rate decrease, while residential properties on average had a rate increase above rates cap due to the valuation shift – meaning that more of the rates burden shifted to residential.

Differential rating

Differential rating means we have a different rate in the dollar for different types of property. We use differential rating is used to maintain fairness and relative consistency in the distribution of rates between property classes and a ratepayer’s ability to pay. A higher rate is set for commercial and industrial properties because of the shift in the distribution of rates. Differential rating addresses this shift and helps to create a fairer rates system.

The differential rates for the 3 types of property for 2022/23 are:

Residential $0.001615 of CIV
Commercial $0.002062 of CIV
Industrial $0.002073 of CIV

Separate waste charges and new services

We've introduced a separate waste charge so we can manage the costs of delivering essential and highly valued waste services. Many of our neighbouring councils have a separate waste charge. This year we're also rolling out a new service for Food and Garden Organic Waste (FOGO).

The charges

All rateable properties will have the waste charge of $176.20.
Properties which also have a kerbside FOGO collection will also pay $88.10 for this service.

Use the FOGO look up service to find out if your house or townhouse will be getting one of these bins.

Differential ratings for different property types, the change to CIV and the separate waste charge are the most fair and equitable way to manage the rates burden and the rising cost of waste management.

How we calculate rates

Step 1: We work out how much money we need to raise from rates to pay for the services we will deliver.

Step 2: We add up all the valuations of every residential, commercial and industrial property in Port Phillip.

Step 3: We calculate the rate in the dollar for each type of property. Revenue ÷ value of properties = rate in the dollar

We've calculated we need to raise $125 million in rates income from properties with a value of $63.5 billion. In the 2022/23 budget, the differential rates for each property type have been set:

Resident rate payers will pay $0.001615 x Capital Improved Value in general rates.
Commercial rate payers will pay $0.002062 x Capital Improved Value in general rates.
Industrial rate payers will pay $0.002073 x Capital Improved Value in general rates.

Your rates bill

On your bill expect to find:

General rates charge (Capital Improved Value x relevant differential rate)
Waste charge of $176.20
Victorian Government Fire Services levy

You may also have:

Kerbside FOGO bin service charge of $88.10
240-litre waste bin surcharge $221

Your bill will also include and concessions or rebates you're entitled to.

What we do with rates and charges

The money raised through rates and charges is used to deliver quality services and manage $3.2 billion in infrastructure.

This year we're focused on:

new waste services
increased investment in community assets
reducing flooding
managing cost inflation.

Every rate payer is provided a copy of our Rates Brochure (PDF 843KB). The brochure has more detail on where and how we spend this income.

See all council services Review current projects

Your questions on rates answered

We have changed how rates are worked out in 2022. In previous years, you have been paying for waste in your general rates, which is based on the value of your property. This year, we have separated it from your general rates to a default waste charge which is a fixed charge. Your general rates have gone down as a result.
This transparent fee for service approach is the same as many other councils in Melbourne. These councils have been separating out waste costs for some time now.
NAV is a way of calculating rates that is hard to understand. It uses a combination of statutory rent return of 5% of CIV for residential properties and actual rent return for non-residential with a 5% minimum of CIV.
CIV is easier to understand as it reflects the market sale price.
CIV also means we can use differential ratings that set different rates for different classes of property. We have introduced differential rates on residential, commercial and industrial. Due to this change, the rates shifts between property classes caused by the annual property valuation are reduced.