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Dublin: 10 °C Tuesday 21 May, 2013

Councils will be able to set their own rate of property tax

Under the plans to reform local government unveiled today, different councils will be able to set different rates.

Image: Sam Boal/Photocall Ireland

ENVIRONMENT MINISTER PHIL Hogan has said that local authorities will be able to set their own rates for property tax in the future.

The move will mean different councils will be able to charge different rates, depending on the services they provide and the amount of money they need to collect.

Speaking at the launch of the Government’s plan to overhaul local government, Phil Hogan said that local authority services will become more and more reliant on income which will be raised from the property tax as  the government aims to reduce the amount of money councils receive from the Exchequer. Currently four out of every ten euro spent by local authorities comes from the central Exchequer.

Property tax is due to be introduced on 1 July next year with the exact details of the rate due to be confirmed on Budget Day on 5 December.

“If [local authorities] are raising the money locally for a particular service provision they will have a say in relation to how they spend it,” said Hogan.

“Therefore each local authority can have a different level of property tax in due course”.

Phil Hogan said that the timing of when councils will be able to set their own rates will be a matter for the government.

The Minister also said that the planned changes will be the biggest overhaul of local government since the Victorian era. He said:

What we had wasn’t a bad system of local government. It as a good system but just built for a very different time. If you think about it, what other aspect of the infrastructure affecting the lives of every citizen in the State has been left unchanged and unchallenged since the nineteenth century?

He said that the Fianna Fáil-led government of 1977 had made a “disastrous” decision to cut the link between local tax and local service for electoral gain, which had led to much of the malaise that exists in the local government system today.

Tánaiste Eamon Gilmore said that the current system is undemocratic and not sufficiently responsive. “Local Government does too little governing,” he said. “The limited role that councils have in issues like job creation of community development undermines its credibility with the public”.

Under the plans released today, the number of councils will be cut from 114 to 31 with the number of councillors reduced by almost half.

Existing town councils will be abolished and replaced by a municipal governing body. The government says that the plans will save the State €420 million over four years.

Read: ‘Fix Your Street’ website to be rolled out nationally by end of year >

Read: Significant reforms will see planning powers of councillors curtailed >

Read: Number of local authorities to be slashed from 114 to 31 >

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Comments (82 Comments)

  • If a local tax there must be local accountability.

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  • Hopefully when voters are actually paying taxes to their local council, they might be a little bit more selective as to who they vote for.

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    • Ryan the party selects the canididate that goes before the voters,otherwise their’re independant non party.

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    • @ Norman: The US (dependant on each State’s rules) is the best example of an open primary system, where voters can determine who the candidate is. However parties (or their members) generally decide candidates in most other democracies including Ireland.

      However I believe the Irish system is better than most in relation to our tradition of electing independents, but to the Dáil and to local councils. Those who genuinely believe they have something to offer can run and stand a good chance of being elected.

      My hope is that this will lead to voters looking at the policies of candidates (and parties) rather than voting based on “he lives on my road” or “he’ll get me that planning permission”.

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    • Ryan most Irish people vote the party candidate,who it is matters little.Party allegence above all else seems to be the theme.Look at FF recent history,yet FF candidates recieved 400k plus votes in the last GE.

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    • Norman. Their vote tally just shows us that there are 400k fools, thieves and traitors in the country.

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    • @ Norman: It is difficult to know why Irish people vote for politicians. Some certainly do vote based on party, however we still have the strong independent tradition I mentioned above. There is also an increasing number of floating voters who change from election to election.

      However if people are directly paying taxes to fund their local council, I think it will make them put more thought into who they vote for. Surely that isn’t a bad thing?

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    • If the local councillor is accountable that is what interests me.

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    • I agree with you logic Ryan. But when the councils have control of the property tax we will see some nasty tactics in regions. Especially from the *youknowwhos*. They will just run for council seats saying that a nice house in a nice estate will have a HUGE property tax. Populist and ultimately dangerous. People would love the idea of voting to screw that successful bloke down the road. Sad, but true.

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    • censored 16/10/12 #

      Hopefully successful people will move out of those areas as a result. What then?

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    • @ Darren, for this to work I think the tax has to be based on the size of the property, not the market value – then it makes sense. If the tax is applied to a property on a fee per square metre basis then you don’t have any issues with anyone using the tax as leverage with populist opinion when running for the council.
      Also the rate will directly affect the services available in the county. Not sure it’ll work with a market value based tax, it has the potential to fluctuate with the market, is that stable enough for a council to budget with?

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  • @ken . I agree with you. I rent my house and while my landlord is fantastic, I would have no problem paying the tax. But in saying that. I would want my bins reduced. The dog poo cleaned so that every time I step out side my door. I’m not stepping in it. But also. I would also want some social welfare recipients to be vetted so that they pay something too. Why should I work my arse off to bearly get by each week. when you see some of them at the post office getting their book but have a big car outside and there fellas are working. And before I get lynched. . I know there are genuine cases out there. and there are people who are just scraping by. But there is also people creaming it. and why should I have to pay for them

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  • The poster behind Hogan and Kenny says “Putting People First”.

    My question is “Are they taking the p**s” ???

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  • Poll tax just like in England

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  • Here’s one of the problems; everyone gets to vote in Council elections but only some will actually be paying for the services. Half the electorate will be voting for those promising more parks, street lighting, festivals, swimming pools etc as there’s no sanction to deter them for voting for these luxuries. Those paying, i,e. property owners on the other hand will want the council to be ever more frugal; turn off those lights, no we don’t need that community centre, sculpture, in fact we don’t even need a council.

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    • Anne, that’s the exact same with every election, local or national. What are you suggesting, disenfranchising anybody who doesn’t own a house?

      The simple fact of the matter is something like you suggest will only happen once. If a council promises huge spending and then sets a high property tax you can be sure that people will let them know what they think.

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    • There will be no property tax !
      It is unenforcible ,this is The Hog passing the buck .

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    • Property taxes exist everywhere in Europe. Please explain why you think Ireland should be so different.

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    • Yes Jim in every National election everyone gets a vote and that is why income tax payers get very fustrated by being hammered when non income tax payers consistently vote for high tax policies. If there must be a local tax and I’m not convinced it’s neccessary then a council tax is fairer as all voters must contribute and so will pay for the policies they vote for.

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    • Jim, that’s irrelevant. Many people in “Europe” speak French so we should too?

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    • @Anne, I’d imagine what will happen then is you will see councils developing policies on this type of thing, and people who want services and are willing to pay the higher tax will move to counties that support those goals, and people who want to pay less tax will move to counties with lower tax and less services.
      If it worked that is. But since the government aren’t willing to open their eyes to the massive problems with mortgage debt it’ll probably fail miserably.

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  • How is it that local authorities are not able to keep the motor tax collected in their own borough? At least people can change their car to get a cheaper rate. Fat. chance of being able to move house so easily

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  • MrKnow 16/10/12 #

    lol, that’s a good one. Northside of Dublin 45% tax, southside of Dublin 30% tax. This should be fun

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  • mike 16/10/12 #

    I wouldn’t let my local council set the price of a bag of spuds.

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  • what will i get for my money? at the moment i pay for my bins,water ,sewage …fire brigade , etc.. so exactly what will i get……..anyone?

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  • Sounds great, there should be real accountability to the electorate.

    There won’t of course, but there should be.

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  • Get the vaseline out! It’s gonna be a rough ride!

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  • Another Hogan f**k up ahead.

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  • SMcB 16/10/12 #

    That’s great… Looking forward to Leitrim Co Co setting a very low rate to take into account the recession …

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  • They want a household charge which some paid and now they want a property tax. Us the people r letting them take our money which we shouldn’t. Next they charge us to piss in our own house. How many more charges r they going to make up?

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  • jrbmc 16/10/12 #

    It should say. Hogan and Kenny

    ” the hole is getting bigger “

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  • One word “Fiasco”

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    • In one word: Why?

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    • @Dave Sherman: One word – YAWN!

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    • So tell me how can this be implemented ? One county pays more than another, one part of a county pays more than another. Where does the money go ? For local services? The cost of your property tax is at the mercy of the efficiencies of the local councils… And that’s why it won’t work as it a fiasco.

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    • That was the way domestic rates worked back in the days before we even had computers. Rates were set by local councils to meet their spending needs. Its the way business rates work today. Are you saying that 35 years on since their abolition on homes that we’re not capable of introducing a similar system?

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    • censored 16/10/12 #

      Dave, so long as there is accountability that is the way it should be. Voters get to decide what level of services they want to pay for.

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    • Jim Walsh wrote:
      “Residential property taxes exist in almost every European country. The idea that we in Ireland somehow shouldn’t have them is simply ludicrous.”

      LMAO. So basically we should jump on the bandwagon and be like sheep ‘just because they do it’. IRELAND ALREADY HAS A PROPERTY TAX – IT’S CALLED STAMP DUTY.

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  • Is Hogan washing his hands of the household tax?
    It all seems too easy ! Just to hand responsibility over to the local authorities.
    Hogan is a coward just like Kenny .

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    • David 16/10/12 #

      Time to move on Eileen.

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    • @ Eileen: You would still be complaining if he had announced that the rates were still being set centrally by his department.

      I fail to see how local councils setting their own property tax rates is a bad thing. Please do share your thoughts if you’ve any besides “I automatically disagree with everything Phil Hogan or Enda Kenny say”

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    • Ryan,

      There should be no property tax. It will only be rolled back after the next election.

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    • The point being ” local councils setting their own property tax rates”. What services would we get ? This is Hogan copping out because he knows that the CAHWT is not going away AND he is on the back foot ,so he passes the buck. Who ever charges these taxes is not on a winner. 50% or close to ,have not and will not pay this charge .€100 this year and anything from €400 upwards depending on the size of your home , next year ,plus water charges on top of TV License, Bin charges , road tax, Dog licenses,etc., …… Really ? Not to mention PRSI, PAYE,USC,and the income levy. They can all dream on I suppose. People are already to the pin of their collars.
      Or are we suddenly going to receive free medical ,dental and optical care etc ,Hospital stays, Bin collections, etc., etc.,.

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    • I can’t believe that SF or any left-wing party would ever suggest removing a property tax, unless of course it was for narrow populist reasons. Some left-wing TDs have suggested a wealth tax or extra taxes on incomes over a certain level. The simple fact is that for most countries a property tax is generally considered a wealth tax so it makes no sense to remove that and then impose a new one.

      The problem with this country over the last twenty years was that we completely narrowed our tax base to ones mainly based on income or unsustainable taxes (such as stamp duty). Every economist for the last number of years has been saying that we need to ensure that we have a wide range of tax sources so that a drop in one area won’t cause the kind of fiscal collapse that has happened in this country.

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    • @ Jim Walsh
      To quote You ……”Yawn”.

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    • Ryan Allen
      You should really attend one of the many many public meetings held all over the country during any given week. You will learn so much as to convince you that every thing that Mr Kenny and Mr Hogan has done and said is so wrong for us here. I know you do not believe me ,but my eyes have been opened. You do know they lied to us and continue to do so.I was a lifetime FG voter , but never again.
      Ryan it does not matter who sets the rates on home taxation .I do not earn an income from my home , therefore ,I will not pay any more tax on it .

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    • So what sort of taxes would you suggest Eileen? I think I’m the one who should be yawning. Your contributions to these debates are nothing more than constant diatribes against the Government with nothing positive or alternative to add. As somebody already pointed out its time to move on.

      Residential property taxes exist in almost every European country. The idea that we in Ireland somehow shouldn’t have them is simply ludicrous.

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    • Jim
      Every other european country have free medical cover, bin charges , etc. They do not jhave stealth taxes or crippling cost of living. But as you find my contributions boring I will not waste my time discussing the issue with you . You carry on doing the dirty work of your paymasters and entertain us all by your own lack of foresight and initiative.
      Again , you should come to any of the many public meetings held throughout the country . :)

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    • Eileen, you are the one who needs to do more research. Far from being free most European countries have charges for every sort of local services especially in the northern, prosperous part of Europe. Have a look at https://www.nordisketax.net/ to get an idea of the sort of tax rates they pay.

      And really Eileen if you can’t argue with resorting to insult and assumption as you do it just shows the weakness in your arguments. You know nothing about me Eileen, you know nothing about what meetings I might or might not attend, who I talk to and how I form my opinions and don’t ever assume you do. But of course if you can’t attack the argument it just easier to attack the person!

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    • Oh really Jim Walsh
      where exactly have I attacked you ? Of course they have free medical cover and medication , go 80 miles up the road and cross the border …. Free medical and hospital and medication, free optical, free dental cover too. However like I have already said I will waste no more of my time with you . Have a really nice evening . Oh great show due to start shortly on RTE one, where we will witness Hogan be helped bully his way through these decisions he made today. I bet there will be no one interviewed with him to challenge him…Coward that he is !

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    • Above comment is from me , my son had been on fb after watching the match … But it is my Point . Thanks .

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    • Apologies ! 3rd time Lucky ,don’t you just love it when kids can be so quick on comps…
      Any way my point still stands !!! Eileen.

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    • @ Jim Walsh

      Since the 1980’s taxes on the rich have been falling. Taxes on the wealthy are currently at a 20 year low. This despite generous tax breaks costing billions of euro.

      The tax base is already widened but there are loopholes that allow companies like Apple and Microsoft to legally avoid paying taxes here.

      The bondholder payments account for €70 BILLION – equivalent to 3.5 years of running the state.

      Jim, if you or anyone else wants to pay stealth taxes step up to the mark and donate extra – no one is stopping you.

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  • So Hogan is wiping his hands of the property tax what ever rates are brought in can be blamed on local councils. People who won’t pay are broke up into smaller groups so no more country wide stand against it.

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  • Roll on the next election, you chancers are out on your arses.

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  • Ken 16/10/12 #

    The property tax on rental properties should also be passed on as a cost to tenants.
    Many landlords are already struggling with negative equity, increased mgt payments, reduced rents, second house tax and will also have the new tax on their own property.
    I have friends who at present can afford to buy, but choose not too as they see it a lot cheaper to rent and leave all associated costs, maintenance & repairs to their landlord

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  • I’m pretty sure I’ve heard of this before. Last time it was called “divide and conquer”.

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  • Seem’s strange yet again that the news is different. One minute we are being subjected to endless threats regarding our homes, and, at the same time seeing money disappearing from this country matched with surprise payments to the troika etc. And are recently told that town councils are being cut after the aftermath of cuts and then county councils being allowed to set their own rates. Phil Hogan couldn’t be more transparent and if you notice the picture who is governing who after all we know Kenny has no back bone.

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  • About time this was money paid that got no results

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  • A Property Tax, for all its evil connotations, might actually wake us up to monitoring where our money goes. Bickering on Radio phone-in shows and current affair programs could give way to more targeted participation at town-hall or other community type meetings. Not a great policy paper or “plan” (mentioned 11 times) but some interesting facts to guide the process – 40% of funding currently sourced from the national lucky-dip tax-pot and, apparently (news to me!) we already have a regional-level form of government…

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  • Simple really.
    Your normal current taxes, on everything you buy, earn and consume goes to the central exchequer for bondholder extraction(post pork-perks 4 d boyos)to creative-acounts central inCayman/Swiss/EU-Name-It stashville.

    Then the shreds of your local authority are allowed be tax-farmers if you want any local services.

    Voila, extraction painless. Happy Saint Patsy’s Day. You’ve beeen IMF’d.

    Reply

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