Municipalities are concerned about the rising costs of property tax appeals. More and more citizens are turning to business complaints bureaus that carry out such procedures for them. This is very costly to municipalities. Because if such a mediation is successful, the municipality has to pay so-called court fees. These fees vary from case to case, from hundreds of euros to several thousand euros.
Municipalities therefore ask citizens to do this themselves and ignore commercial establishments. Because if you appeal yourself without a professional party, the municipality does not have to pay any legal fees.
“Municipal funds are running out”
One of the municipalities that made the call is Deventer. “This bothers me,” says City Councilor Marcel Elferink. “We have to be careful with public money, and now it goes to the commercial parties.”
In his view, the fees charged by these bodies are disproportionate to the tax deduction that a citizen can expect if the procedure is successful. “The property tax is usually a few tens, and for such an appeal body there is sometimes up to 2,000 euros in compensation.”
According to the Dutch Association of Municipalities (VNG), these fees are very profitable even for small businesses. “There is often mass automation. At the push of a button, the objection comes from the printer or goes directly to the municipality. That was not what the legislator had in mind when determining the legal costs.”
The cost to local authorities consists not only of these allowances, but also of the time the authorities spend on them. “The total cost of the appeals process can ultimately be as high as three times the fees,” says Ruud Kathmann of the Estimation Office responsible for municipal property valuation.
‘Experience’
“Municipalities are also saying more and more often: call first. If they find a mistake, they can fix it quickly and easily,” says Kathmann. “Because if you go through a formal appeal procedure with a pass, a hearing and things like that, it takes a lot longer.” Besides Deventer, Arnhem, Haarlem, Medemblik and Zwolle are also calling on citizens to resist.
The municipalities of Achtkarspelen and Tytsjerksteradiel have made this DIY call:
“Commercial parties emerged because municipalities did not take their citizens seriously,” says Dirk-Jan Wolfert of Vastelastenbond in a response. The firm carries out these objection procedures together with two consultancy firms. “They only have to pay compensation if the municipalities didn’t guess it correctly and the WOZ has to be lowered. If the municipalities do their job well, the agencies have nothing to gain.”
The advantage of consulting firms is that they have experts. “You know very well how to object.”
cost plate
The Treasury calculated that municipalities would have to pay 18m euros in legal costs in 2021, compared to 12m euros two years ago.
About 3 percent of WOZ decisions are challenged each year. And an increasing proportion of this is done through commercial agents. It was 36 percent in 2019, it will be 51 percent in 2022. On average, less than 40 percent of all appeals are accepted. And on average, if an appeal is accepted, the home’s value will drop by about 9 percent.
Source: NOS
Roy Brown is a renowned economist and author at The Nation View. He has a deep understanding of the global economy and its intricacies. He writes about a wide range of economic topics, including monetary policy, fiscal policy, international trade, and labor markets.
