Returns from owners and occupiers, of a nature to those made under the Income Tax Acts, may be required by the overseers, the same to be delivered by each ratepayer within twenty-one days after the service upon him of a notice and form. And an assessment committee has power to order an owner or occupier of any hereditament to send a return of all or any of the following things, viz. :— (a) The rent receivable or payable by him (as the ease may be) for such heredita ment ; (b) the person entitled to any tithe rentcharge charged thereon and of its amount, and of the several persons by whom any tithe rentcharge is paid to him, and of the amounts paid by each such person ; and (c) any other particulars respecting such hereditament as are required for the due execution of the law. The order must be obeyed within fourteen days after service thereof, or, in case of refusal or neglect, a penalty will be incurred.
Principle of valuation.—This is found on reference to section 1 of the Parochial Assessments Act, 1836, which defines the net annual value of rateable hereditaments in the following words :—" No rate for the relief of the poor in England and Wales shall be allowed by any justices, or be of any force, which shall not be made upon an estimate of the net annual valaic of the several hereditaments rated thereunto ; that is to say, of the rent at which the same might reasonably be expected to let from year to year, free of all usual tenants' rates and taxes, and tithe commutation rentcharge, if any, and deducting there from the probably average annual cost of the repairs, insurance, and other expenses, if any, necessary to maintain them in a state to command such rent." This definition should be compared with that contained in the Metropolis (Valuation) Act, 1862, set out above on page 54. Perhaps the best way to illustrate the working out of this principle in practice will be to follow the lines of a set of actual instructions given by a Board of Guardians to the overseers in its union. These instructions must not, however, be taken as absolutely correct at the present thne in all details, for many of the examples referred to therein are really matters for special valuation, and, accordingly, one or two of the " rules of thumb " must be taken more as indications than as fixed rules. To Mr. F. C. Hett, Clerk to the Guardians of the Glanford. Brigg Union, in Lincolnshire, who presented these instructions to the Royal Commission, is due the credit of their original preparation. They have, however, been freely adapted for this work.
Speaking generally, real property of every kind is now assessable to local rates upon the " net annual value," as determined by the valuation list in force, and as the statute also requires that the "gross estimated rental '' shall be inserted in the valuation list, it is necessary, in valuing property for rating purposes, to clearly apprehend the meaning of these two terms. Put shortly, the rateable value of any property let at a reasonable rent is the clear annual sum which the landlord puts into his pocket for his own use.
It follows that if property is let at a reasonable rent, such rent will form the proper basis of assessment, but it does not follow that such rent is to be taken as the "gross estimated rental." Take for example three houses A, B, and C, structurally equal and in all other respects of equal value, for the purpose of local rates. Assume that the repairs and insurance of each house cost £9 a year, that the local rates amount to £7, 10s., and that the rents are reasonable rents. The owner lets house A for £60 a year, and agrees to repair, insure, and pay the tenant's rates ; he lets house B for £52, 10s., and agrees to repair and insure, but
the tenant pays his own rates ; he lets house C for £43, 10s., the tenant under taking to keep in repair and insure, and pay the tenant's rates. Yet it is obvious that the gross estimated rental and rateable value of each of these houses ought to be the same. And so, indeed, they will be found to be, taking in each case the rent paid as the basis of the assessment, as the following calculations clearly illustrate Applying these principles where a property is let, there is little difficulty in determining the correct gross estimated rental, provided it is borne in mind that the rent actually paid is not necessarily assumed to be a reasonable one. For example, a small farm let to a working man at a rental a fourth higher than that paid by his neighbours. The man makes both ends meet, because he works on the farm himself. But it may be that he is paying to his landlord not only a reasonable rent, but also a portion of what ought to be his own profit as a tenant. But tenants' profits are not rateable ; therefore the gross estimated rental should not be more than three-fourths of the rent. On the other hand, a landlord may let a farm to a relative at, say, a fourth less rent than that usually paid for similar farms in the parish. In such a ease the gross estimated rental should be a fourth higher than the rent. Again, the nominal rent paid to a brewer or spirit merchant for a public-house, the occupier being bound to purchase beer or spirits from his land lord, could not be taken as any indication of the annual value. In such case it must be considered what the house would let for as a free public-house. But where property is in the occupation of the owner there is often greater difficulty, and, consequently, such property is frequently much under-assessed. As to land so occupied, the overseer's knowledge of the general value of land in the parish will no doubt enable him to assess it satisfactorily. But where buildings are so occupied his task will be less easy. If he can find similar property let to a tenant in the parish or immediate neighbourhood, he may, by comparing the two, arrive at a proper assessment. If, however, no such means of comparison exist, it will be necessary to find some other basis of value, and he may consider what rent the occupying owner would probably give for a building if it belonged to some one else, and if in all other respects the owner's position remained unchanged. Take as an instance the owner of extensive estates with a large mansion in the centre. Suppose the ownership of the estates to remain unchanged, but that the mansion became the property of another. What rent might the owner of the estates be then expected to pay for the mansion ? Or one may estimate the present structural value of the building, and make the capital value so arrived at the basis of assessment, the percentage to be placed upon such capital value to ascertain the annual value depending on the nature of the building and its locality. For example, a new house which has cost £2000 to build would probably not be worth to let in a village more than £60 a year, or 3 per cent. upon the structural value, in addition to the annual value of the site, whereas the same outlay in the main street of a good town would probably obtain a return in the shape of rent of from £100 to £140. The above observations as to occupying owners equally apply where properties which are to be assessed separately are held at one rent under the same landlord, as in the case of a farm comprising (a) a farmhouse, (b) farm buildings, and (c) arable, meadow, and pasture land.