New toilet tax to hit Manx residents in the pocket

Tynwald buildings, Douglas

Tynwald buildings, Douglas

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A flat-rate sewerage charge will be levied on most homes and businesses under plans unveiled in Tynwald this week.

The Water and Sewerage Authority wants to introduce a £50 annual charge per property or flat from April 1 this year, rising to £100 from April 2015.

That would mean the tenant of a council flat would pay the same as anyone who lives in a mansion.

John Houghton MHK, the authority’s chairman, told Tynwald this week that the charges were needed to meet the cost of its loan repayments and interest charges on its capital schemes.

He said: ‘In order to continue to operate without going into deficit it will be necessary to change the way these important functions are funded.’

Subject to Tynwald approval, the charge will be levied on all properties connected directly or indirectly to a public sewer and will be included in the rates bill.

At the same time, the same level of charge will be introduced for emptying septic tanks. Mr Houghton said a ‘phased transition’ was being proposed ‘to ensure a smooth introduction of the charges and to give the public time to adjust to the change’.

Liberal Vannin party chairman Peter Karran (Onchan MHK) was the only Tynwald member who queried the proposal. He said: ‘Obviously it’s a very sad day but we are in a mess and we have to find ways of dealing with this calamity.’

He suggested it was unfair people with bigger houses would pay the same.

Mr Houghton replied the Council of Ministers has commissioned an investigation into rateable values to provide a more equitable system.

‘Because of that it was decided by the Authority, and CoMin agreed, that we put a clause in the Flood Risk Management Bill which has now been enacted in order to place a charge rather than a rateable value on the cost of sewage recovery of funds as Treasury monies reduce year on year.’

He added: ‘The law says there is one charge per property so it matters not whether it’s a hotel or business premises, the Villa Marina, or a school.’

Mr Houghton said: ‘Following the introduction of the charges an assessment will be made on their equitability and the affordability for any further increases in future years.’

He said it was the ‘only practical solution’ to address year on year cuts in funding from Treasury. In addition, Treasury will be re-introducing the requirement for the authority to meet the full cost of its capital loan repayments and interest charges.

Its capital projects come under the regional sewerage treatment strategy, which covers improvements to sewage plants and the construction of new regional treatment works and pumping stations.

At present, the authority owes £90m, but this figure is expected to rise as it continues work on the strategy.

The £50 charge is expected to raise about £2 million, and double for the £100 charge.

It comes in addition to the water rates, which vary according to rateable value.

The charges are unconnected with the pending merger with the Manx Electricity Authority to form the Manx Utilities Authority.

An order will be brought to Tynwald seeking approval to bring the charges into effect from April 1.

Meanwhile, a public consultation will be launched on proposals to charge for the treatment of trade effluents.

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