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Expert group set to issue property tax recommendations within four months

The government is expediting the process to determine what will eventually replace the already controversial household charge.

Image: Eamonn Farrell/Photocall Ireland

AN EXPERT GROUP will convene in the New Year to consider the rates of property tax which should be applied on houses in Ireland as a permanent replacement for the household charge.

The process has been expedited by the government with the expert group now expected to report towards the end of March or the beginning of April next year, according to a spokesperson for the Department of Environment today.

“The group will report in late March or early April. We’re talking two to three months, depending on the volume of issues. It’s not going to drag on,” a spokesperson told TheJournal.ie today.

Who will be in the group has not yet been announced but the Irish Times has reported this morning that it will include representatives from government departments as well as members of the Revenue Commissioners. It will likely be chaired by the Department of Finance.

It comes amid reports this week that the charge would be based on the Commission on Taxation’s 2009 report which recommended an annual tax on residential housing that would vary according to the value of the property.

Valuation bands

The report said it should be €188 for houses up to the value of €150,000; €563 for houses worth between €150,000 and €300,000; €938 for houses between €300,000 and €450,000; €1,313 for houses up to €600,000 and €2,188 on houses valued at up to €1 million.

Any houses valued between €1 million and €1.5 million would face a tax of €3,125.

However, the spokesperson for the Department of Environment said: “Everything will be considered by this group. It could be completely different and it has to go to Cabinet before anything is legislated on”.

Despite reports that the new property tax could come into effect in 2013. The Department said that it still anticipated the household charge of €100 annually would be in place for two years.

“At the moment the plan remains for the household charge to be in place for two years,” the spokesperson added.

The charge will come into effect in the New Year and anyone who owns a property will be expected to have agreed an instalment arrangement or paid it in full by the end of March 2012.

A number of TDs including independents and Sinn Féin party members have said they will not pay the charge in protest at its imposition. A group of independents is urging others to boycott what they consider to be a “regressive tax”.

Responding to Environment Minister Phil Hogan’s public comments about the eventual property tax, independent TD Thomas Pringle, who is not paying the charge, said Hogan’s comments had been “a complete reaction to opposition” to the household charge.

“I doubt if this government is capable of implementing a fair and equitable tax system,” Pringle said of the eventual property tax.

Hogan has called the TDs’ boycott a “PR stunt” while other government ministers have indicated it could be docked from wages or welfare in the event it is not paid.

Tenants not liable

Meanwhile the Irish Property Owners Association has withdrawn its recommendation that members should pass on the household charge to tenants at the request of the Competition Authority.

Despite the legislation stating that the charge is to be levied on property owners and not tenants IPOA told its members to impose a levy on tenants to meet the cost.

The Competition Authority said this could be in breach of competition law and said it would seek an injunction if the advice was not withdrawn.

The advice remains on the IPOA website under the Authority’s clarification notice. A government spokesperson said the legislation makes clear the charge is on property owners and not the occupier.

“There is no facility for them [owners] to pass on the charge as it stands,” the spokesperson added.

Budget 2012: Who exactly has to pay the €100 Household Charge?

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