SA say the town's decision is exemplary

An exemplary achievement!

The industry association says the City of Hafnarfjörður is a model to follow when it comes to levying property tax on commercial premises. The city has offset the increase in property valuation by lowering the tax rate. Other local authorities could take this as an example.

The property tax rate for commercial property in Hafnarfjörður was lowered from 1.400% to 1.387% in this financial year to offset an increase in property valuation. The levy of property charges, i.e. property tax and related fees (excluding land lease), on commercial premises decreased from 1.568% to 1.555% year-on-year. The association says nearly half of local authorities have their business property tax levy at the statutory maximum or at 1.65%.

The Federation of Industry says in an analysis, published on 8 August, that industrial premises account for just over 39% of the country's commercial property, based on property valuation. „Property taxes on commercial premises therefore place a heavy burden on the country's industry. 64% of industrial company managers say that it is very important for their companies“ operations that property taxes on commercial premises are lowered. Only 16% say that it makes little or no difference," the new analysis states.

The rate has been lowered

The trend in the rateable percentage for commercial property can be seen in the report for the City of Hafnarfjörður's budget.

The Federation of Industry points out that the local councils of some of the country's largest municipalities have, in recent years, met the increase in property assessment by lowering the rateable value. „Kópavogur and Hafnarfjörður are examples of this, where the tax rate is lower than in other larger municipalities. The Federation of Industry believes their approach is exemplary for the councils of other municipalities,“ the analysis states.