The changes in this year's Finance Act halved the number of taxpayers paying residential property tax but retained all the reliefs which had been introduced in 1994 to meet concerns over the impact of the tax on certain households. The Finance Act increased the property value exemption threshold from £75,000 to £94,000 and increased the household income threshold from £25,000 to £29,500. The legislation provides that these thresholds will be index linked in future years.
The increase in the property value threshold is linked to the new house price index published by the Department of the Environment. The household income exemption limit will be increased by reference to the consumer price index published by the Central Statistics Office.
This indexing means that increases in property values or wage levels should not in themselves have a significant effect on the numbers in the residential property tax net.