In accordance with section 20 of the Finance (Local Property Tax) Act 2012 (as amended) elected members of a local authority are required to pass a formal resolution in order to vary the basic rate of Local Property Tax (LPT) in respect of residential properties situated within their functional area. The basic LPT rate can be increased or decreased by up to 15%. This is referred to as the "local adjustment factor" (LAF) and the earliest year that this can apply is 2015. The formal resolution should specify the percentage by which the basic LPT rate is to be varied and the year(s) that this variation will apply.
In determining the LAF, local authorities are required to take account of their income and expenditure projections for the coming year, their current financial position and the effect of the variation on the economy and taxpayers in their functional area. The Minister for the Environment, Community and Local Government has the power to make regulations with respect to the setting of the LAF and it is my understanding that he intends to do so.
Where the elected members of a local authority pass a formal resolution to vary the basic LPT rate for 2015, the local authority is required under section 21 of the 2012 Act to notify Revenue on or before 30 September 2014 of the LAF that will apply to the basic LPT rate for 2015 (that is, the percentage by which the basic LPT rate is to be varied). This statutory deadline is to ensure that all the necessary administrative arrangements can be put in place for the payment of LPT at the appropriate rate in 2015 and most importantly, that property owners are given adequate notice of their LPT liability for 2015 to enable them to select their preferred payment method in good time for the filing date.
I am advised by the Revenue Commissioners that, as part of their customer service and information campaign in relation to the LAF, they wrote to each City and County Manager at the end of March 2014 to remind all Managers of the deadline by which Revenue must be notified if their particular local authority intends to vary the LPT rate for next year. A copy of the letter in question will be sent directly to the Deputy.
I am also advised that the Commissioners will be writing to all City and County Managers again in advance of the September 2014 deadline specifying the details, which the Commissioners expect will be straightforward, that they require from local authorities in connection with the LAF.
Any adjustments in the rate of tax will be reflected in the usual communication which Revenue will issue in advance of the next filing date in respect of properties which, according to their records, are in the relevant local authority area.
