Local Property Tax (LPT) is a vital source of funding for local authorities. Authorities use the funding in the provision, for example, of parks, libraries, leisure amenities, fire and emergency services and improvements to the public realm, all of which benefit citizens directly and improve the fabric of our communities and quality of life.
LPT allocations are based on estimated liability data from the Revenue Commissioners, with all of a local authority’s annual allocation used to provide services locally. Local authorities have the power to vary the rates of LPT, up or down, by up to 15%. Where an authority varies the rate upward, it retains the additional income and, likewise, where the rate is reduced, the income is foregone.
Every local authority retains 80% of the estimated LPT liability in their area, notwithstanding local variation decisions. All local authorities contribute the remaining 20% to assist national equalisation funding. Some 80% of the total LPT allocation in 2019 is being used at each local authority’s own discretion. In addition, some 20% of LPT is directly supporting the provision of vital Housing and Roads infrastructure and services.
I am satisfied that the current overall funding model enables local authorities to support an appropriate level of service provision across the State. However, the position will be kept under review in light of the outcome, in due course, of the LPT review being led by my colleague, the Minister for Finance and Public Expenditure and Reform, as well as my own Department's LPT Baselines review.