Contribution to the Finance Local Property Bill 2012

December 14th, 2012 - Pat Breen

I welcome the opportunity to contribute to the debate on this Bill. The introduction of any tax is never popular, but particularly so in the midst of the greatest recession since the foundation of the State. Property taxation is the norm throughout the world and the proposed rate of 0.18% compares favourably with the rate in other countries. I note that while Sinn Féin is opposed to the introduction of a property tax in this State, it, as a party of Government in the North, does not seem to have any difficulty with a much higher charge being levied in that jurisdiction. A householder in the North whose home is worth €200,000, for instance, is expected to pay in the region of £1,500 annually in property tax. In this State, on the other hand, the owner of a property of the same value will pay only €202 next year and €405 in a full year. The Government’s success in keeping the charge to a minimum is very welcome. Furthermore, the Minister’s undertaking not to increase it over the lifetime of the Government offers certainty to householders. This week’s edition of The Economist, a very reputable publication, refers to the “modest” property tax being introduced by the Irish Government against the background of a collapse in property prices.

I recently met with a group of business people in Shannon whose concerns related mainly to local authority rates, which are a huge problem for businesses in every town and county in the country. These particular business owners, from Shannon, Ennis and Kilrush, had their premises valued at the height of the boom and the rates assessed on that basis. Despite the downturn and the reduction in property prices, they are still expected to pay the same rates. The inclusion in the Valuation (Amendment) Bill 2012 of a facility for the revaluation of business premises is particularly welcome in this context. I look forward to discussing the issue when the legislation comes back before the House.

As we know, the household charge was an interim measure. From the dealings I had with constituents last year, I would agree with my colleague, Deputy Paschal Donohoe, that the problem was not so much that people were unwilling to pay the charge but that the methods of payment were not very accommodating. In some circumstances, in fact, people found it impossible to furnish their payment. As such, I welcome the proposal that the Revenue Commissioners will conclude a service agreement with An Post whereby people can pay the property tax at their local post office. This will assist home owners in rural areas, especially the elderly, with the added benefit of enhancing the viability of community post offices.

In line with a similar provision under the household charge, section 7 includes an exemption from the new property tax for charities. Will the Minister clarify whether this includes the residences of priests? Specifically, I have been contacted by the diocese of Killaloe regarding the residences in its area which are registered in the ownership of St. Flannan’s (Killaloe) Diocesan Trust, a registered charity. The concern is that the wording of the section seems to suggest that the exemption is conditional on a property being provided for special needs accommodation, which does not match the exemption criteria for the household charge. Ultimately, the charge in this case will be borne by taxpayers on behalf of the parish, so it is an issue the Minister should clarify.