I propose to take Questions Nos. 121 and 123 together.
Under section 157 of the Finance (Local Property Tax) Act 2012, commencing in 2014, the Minister for Finance will pay into the Local Government Fund an amount equivalent to the Local Property Tax (LPT) paid into the Central Fund during that year. In 2013, the funds raised by the tax will accrue to the Exchequer. Should a disproportionate number of liable owners living in the functional area of a given local authority defer payment of the tax in 2014 or subsequent years under Part 12 of the 2012 Act, those deferrals will have a financial impact on that local authority. As the rate of deferral will not be known until individual homeowner LPT returns are made to the Office of the Revenue Commissioners by 28 May 2013, it is not possible to estimate the potential implications for any particular local authority.
As regard local authority services, I expect the Local Property Tax to have multiple benefits, including:
- A more sustainable and resilient system of funding for local authorities and therefore a sounder financial footing for the provision of essential local services;
- Greater local scope for financial decision making concerning service provision - in particular, the inclusion of the local variation mechanism from 2015 will further increase the autonomy of local authorities; and
- A strengthening of democracy at local level and a more active relationship between local authorities and local electorates – a stronger democratic relationship and clearer lines of accountability can only have a beneficial impact on service provision from the perspective of the service user.