Dáil Éireann Debate, Tuesday - 24 October 2017
50. Deputy Catherine Murphy asked the Minister for Finance the aspects of the local property tax that are being considered by the cross-departmental group; if it involves a fundamental review of local government funding; if it is isolated to valuations; if consideration is being given to widening the review; and if he will make a statement on the matter. [45092/17]
View answer51. Deputy Catherine Murphy asked the Minister for Finance if the cross-departmental group has considered the overall funding available to local authorities in the context of the review of local property tax; his plans to deviate from the baselines set for each council; and if he will make a statement on the matter. [45095/17]
View answer52. Deputy Catherine Murphy asked the Minister for Finance if the cross departmental group reviewing the local property tax has modelled different scenarios; if so, if he will publish them; and if he will make a statement on the matter. [45093/17]
View answerI propose to take Questions Nos. 50 to 52, inclusive, together.
Dr Don Thornhill was engaged by my predecessor in 2015 to consider the operation of the LPT, and in particular, any impacts on LPT liabilities due to property price developments. The terms of reference for the review required that it also have regard to the overall yield from LPT and its contribution to total tax revenue on an ongoing basis and the desirability of achieving relative stability, both over the short and longer terms, in LPT payments of liable persons. Dr Thornhill’s review was informed by the outcomes of a public consultation which received 51 written submissions.
Dr. Thornhill made a number of recommendations in his report on his review of the Local Property Tax. His central recommendation was for a revised system whereby a minimum level of LPT revenues in each local authority area would be determined by Government, ideally having regard to the apportionment between local authority areas of the historic yield. This in turn would allow for the estimation of LPT rates for each local authority area and the application of these by taxpayers and Revenue. Local authorities could adjust this rate upwards by a factor of up to 15%. This new system was recommended by Dr. Thornhill with a possible interim deferral of the next valuation date until November 2018 or November 2019.
My predecessor subsequently proposed to Government that the revaluation date for the LPT be postponed from 2016 to 2019. This postponement meant that home owners were not faced with significant increases in their LPT in 2017 as a result of increased property values. The postponement also gives sufficient time for the other recommendations in Dr. Thornhill's report to be considered fully by the Government. As I indicated during my appearance before the Budgetary Oversight Committee on 27 September this work will be undertaken during 2018. Naturally my Department will be engaging closely with in particular the Department of Housing, Planning and Local Government in this process. I can assure the Deputy that this work will be done in good time and that the Government will make its position clear so that households will know well advance what its plans are for LPT.
