Abstract

Local government finance, and in particular the basis of domestic rating, is currently the subject of a major review in Northern Ireland. The authors have conducted empirical research into a comparison between the present rating system and two alternative options - a banded system or a property specific discrete system. Derry City Council is used as a case study to gauge the likely redistribution effects of changes to the system. The findings are seen as significant in describing the effects of each policy regime at a local level in terms of winners and losers. In addition, the impact of the policy options in relation to a measure of income deprivation was investigated. The results indicate that a discrete value system performs best in terms of minimising the effect of rate redistribution and providing for a more fair and equitable local tax.