LPT cuts affecting housing and services
Published 19/10/2015 | 02:30
Cash-strapped local authorities are unable to fund social housing projects and essential services - but they are losing €45m a year by reducing property tax rates.
A report for Finance Minister Michael Noonan says the money is being lost after councillors voted to reduce the annual bill for homeowners.
And while the measure may have a limited impact on voters, except those living in more expensive properties, it can nonetheless have a profound impact on delivery of local services.
The Local Property Tax (LPT) is designed to support the provision of services including housing, public parks, libraries, fire and emergency services, and street cleaning.
Many councils are struggling to provide these services due to a shortage of funds.
But despite this, councillors are allowed to increase or reduce the rate by a maximum of 15pc.
The report says the Revenue Commissioners estimate that the so-called local adjustment factor "will have the impact of reducing LPT collected by €45m".
A total of 14 of the 31 local authorities have reduced the rate. They include the four Dublin local authorities and Wicklow and Clare county councils, which reduced by the full 15pc.
Meanwhile, Cork city and county councils cut the rate by 10pc; Kildare dropped the rate by 7.5pc; and Limerick City and County Councils and Longford, Mayo and Westmeath reduced it by 3pc, while Louth cut it by 1.5pc.