Wednesday 22 November 2017

It's three strikes then court for house tax rebels

The method of calculating the tax by market value will mean homeowners in the city will pay more than owners of a similar house in the country. Photo: Thinkstock
The method of calculating the tax by market value will mean homeowners in the city will pay more than owners of a similar house in the country. Photo: Thinkstock

Fionnan Sheahan Political Editor

HOMEOWNERS who still have not paid the household tax will now get three letters urging them to pay the €100 before being landed with a court summons.

The first letter will be a gentle reminder to pay. The second will warn of the consequences of not paying. And the third will threaten court action if the bill isn't paid within a specific timeframe.

The clampdown comes as the Government is heading for an urban-rural split on the permanent property tax, which is expected to be more expensive in urban areas.

The property tax is set to be based solely on house values, which are higher in cities.

There is an expectation within government circles that the letter campaign will prompt a flood of payments.

The first round of letters have been sent out and are due to arrive from this morning.

The Irish Independent understands that about 100,000 letters will be sent out on a rolling basis.

Groups to be targeted in the first tranche include landlords and owners of second houses.

The letters will directly identify the owner of the house, using a range of address databases from government departments and state agencies.

The bodies whose data will be used to track defaulters include:

- Revenue Commissioners.

- The Department of Social Protection.

- ESB Networks.

- The Non-Principal Private Residence (NPPR) charge.

- The Private Residential Tenancies Board (PRTB).

- And the Property Registration Authority (PRA).

Just over half the homeowners in the country have paid up and the authorities still have to chase payment from about another 650,000 houses.

The letters will be sent out by city and county councils and say the property listed has not been registered for the household charge.

The first letter tells the homeowner that the late fees and penalties on top of the €100 are already €14.

"If you pay by July 31, the amount due, including late payment fees and interest, is €114 per property. This amount will continue to increase monthly so avoid unnecessary late payment fees and interest by paying now," the letter says.

The longer the homeowner goes on without paying, the stronger the language in the letter:

- Reminder: the first letter simply says the charge is not paid and provides information on how to pay.

- Warning: the second letter is a further reminder and outlines how the law allows for pursuit of the payment through legal options.

- Threat: the third letter will tell the homeowners they have a certain period of time to pay and if they don't that legal action will begin.

In court, the maximum fine for not paying the household charge is €2,500.

The agency in charge of collecting the payment, the Local Government Management Agency (LGMA), is continuing to analyse data to identify further householders who have not yet paid the charge.

The first batch of letters will begin to arrive in households from this morning.

Household Charge Project Board chair Jackie Maguire said the first batch of homeowners who had not yet paid the charge had been taken from a "sample set" following an initial data comparison between the household charge database and other databases.

To date, the Government has collected €95.5m from the charge.

A total of 957,733 properties have registered for the household charge with a further 17,607 properties registered for waivers.

The LGMA says money continues to be paid in daily and penalties and interest are still accruing for those properties that have yet to be registered.

Meanwhile, the property tax to replace the household charge next year is expected to be based on the value of the house if it was to be sold.


The method of calculating the tax by market value will mean homeowners in the city will pay more than owners of a similar house in the country.

The new system is expected to be self-assessed and to see the owner of a regular three-bedroom semi-detached home pay €200 to €400.

But the market-value method of calculating the level of tax will prove controversial.

Initially, government sources said the property tax was expected to be in the form of a 'site valuation tax', which taxes the value of the site and ignores the value of the house.

As the tax is on the raw value of the site, it takes account of the location more than the physical bricks and mortar of the house itself.

So, two houses side-by-side -- one rundown and one modern -- on the same size site would be levied the same amount of property tax.

This method would lessen the gap between urban and rural houses.

However, it has now emerged the property tax will be solely based on the market value.

Irish Independent

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