Local Authority Finances

Dáil Éireann Debate, Tuesday - 11 November 2014

Tuesday, 11 November 2014

Questions (546)

John McGuinness

Question:

546. Deputy John McGuinness asked the Minister for the Environment, Community and Local Government if his attention has been drawn to the decision of the Revenue Commissioners with regard to a dispute over the payment of VAT between Carlow County Council and a company (details supplied) and the fact that Carlow County Council were deemed liable for the VAT; if arising from this decision he will confirm if Carlow County Council will now resolve matters with the other party; if he or the local government auditors are concerned about the legal costs in this case and that Carlow County Council appears to be intent on spending more public money in challenging the outcome; if he will confirm the costs to date; and if he will make a statement on the matter. [43327/14]

Written answers

Minister for the Environment, Community and Local Government

I understand from Carlow County Council that this matter relates to a long and complex taxation dispute involving the Council, the Revenue Commissioners, a third party who, in 2006, agreed to provide a section of the Carlow Eastern Relief Road (in lieu of the payment of development contributions as is provided for in sections 47 and 245 of the Planning and Development Act 2000), and the courts. The local government auditor, in 2011, requested that the Council establish whether or not there was a possible tax implication associated with this agreement and, in May 2011, Carlow County Council made a submission to the Revenue Commissioners in this regard. I understand that Carlow County Council have asked that the matter be expedited with Revenue. The issue is still subject to legal processes involving these parties. It is a matter for each local authority to determine its own spending priorities in the context of the annual budgetary process having regard to both locally identified needs and available resources. The elected members of a local authority have direct responsibility in law for all reserved functions of the authority, which include adopting the annual budget and authorising borrowing, and are democratically accountable for all expenditure by the local authority.