The EU/IMF Programme of Financial Support for Ireland under its fiscal consolidation measures commits to the introduction of a property tax for 2012. In light of the complex issues involved, a property tax, requiring a comprehensive property valuation system, would take time to introduce and accordingly, to meet the requirements in the EU/IMF Programme, the Government decided to introduce the household charge in 2012. The household charge is an interim measure and an equitable valuation based property tax will be introduced as soon as possible.
The household charge is a new dedicated source of funding for local government and will go towards paying for essential local services such as planning and development, fire and emergency services, maintenance and cleaning of streets and street lighting public parks, libraries, open spaces and leisure amenities.
The Local Government (Household Charge) Act 2011 and the Local Government (Charges) Act 2009, as amended, set out the legislation underpinning the household charge and the charge on non-principal private residences respectively.
Application of the legislation in particular circumstances is a matter for the relevant local authority. Interpretation of the legislation is a matter for legal advice in individual cases and ultimately a matter for the Courts. Under the legislation, an owner of a residential property on the relevant liability dates is liable to pay the charges, unless otherwise exempted or entitled to claim a waiver. The charges are on a self-assessment basis and it is a matter for an owner of a residential property on the liability date concerned to determine if he/she has a liability and, if so, to declare that liability and pay the charges by the due dates.
The legislation contains a common definition of "residential property" for the purposes of the Acts. Section 2(2)(d) of the Local Government (Household Charge) Act 2011 and section 2(2)(d) of the Local Government (Charges) Act 2009, as amended, provide that a building that is wholly used as a dwelling (other than a dwelling that forms part of a mixed hereditament within the meaning of the Local Government (Financial Provisions) Act 1978), and in respect of which local authority rates are payable, is not a residential property for the purposes of the household charge and the non-principal private residence charge respectively.