Sunday 25 February 2018

Cabinet split over property tax grab

Gilmore out on limb as FG stands firm on payment before Christmas

THE Coalition is deeply divided over the Revenue's pre-Christmas property tax grab, with Fine Gael insisting that there will be no climbdown on the controversial payment deadline.

The Cabinet will discuss the debacle at its meeting on Tuesday as tensions mount among ministers over homeowners being asked to pay a 2014 tax in 2013.

Fine Gael figures are enraged by Tanaiste Eamon Gilmore calling for the payment deadline to be pushed out. And a Dail committee is going to haul in Revenue officials to answer questions on the communication with householders.

Taoiseach Enda Kenny and Finance Minister Michael Noonan are not for turning and are standing by Revenue's independence. Mr Gilmore is standing over his call for Revenue to "reconsider the deadline" for those making the one-off payment.

The Tanaiste is now out on a limb and will be embarrassed if there is no change to the deadline.

Speaking last night to the Sunday Independent at the Double Tree Hilton Hotel in Dublin where the Fine Gael Presidential dinner was taking place, Taoiseach Enda Kenny backed the Revenue Commisioners' right to implement taxes as they see fit.

He said: "The Government decides what policy is, the Revenue Commissioners implement and enforce that policy."

"Nobody – and I repeat nobody – is required to pay the 2014 property tax in 2013, but I would encourage as many people as possible to use the options, of which there are up to six , to ensure that they pay their property tax in 2014."

Asked directly about Tanaiste Eamon Gilmore's comments on the property tax the Taoiseach said: "The Tanaiste reflects the opinion that the Government and the Dail are an entirely separate matter. Government decides what policy is; the Dail legislates for that policy; and the Revenue Commissioners, an entirely independent body and rightly so, implements that policy."

Almost a million homeowners have just weeks to sort out how to pay their property tax bill for 2014. But there is widespread confusion about why compliant taxpayers are being asked to pay a tax in 2013 that isn't due until 2014.

Payment by credit card, debit card or cheque is due by November 27. Homeowners need to confirm their payment method for 2014 by November 27, if doing so online, or by November 7, if doing so by paper.

As a result of Revenue's letters last week, 30,000 householders have already replied by selecting their payment option for 2014. It is not clear how many of these have actually paid up at this stage.

Speaking on behalf of the Taoiseach and the Government, Mr Kenny's spokesman ruled out an intervention. "Tax administration and collection is a matter for the Revenue Commissioners and are necessarily independent of Government," the spokesman said.

Defending Revenue's stance, Mr Noonan also gave no indication of a U-turn.

"Administration of taxes is a matter for Revenue and there are at least four, and up to six, options that allow people to pay the local property tax in 2014. Taxpayers should select the best option for their particular circumstances," his spokesman said.

But Labour TD Ciaran Lynch, who is the chairman of the Oireachtas Finance Committee, said he would be inviting Revenue before the committee to answer questions.

"The current requirement that there be an upfront payment before it is due is not in the customers' interest.

"People are not complaining about the property tax. They are complaining about the ambiguity around the payment," he said. "We will be looking for Revenue to come in as soon as it's feasible."

Mr Gilmore came under fire both from within the Coalition and the Opposition.

"It looks like another gamble, everything he now says is targeted to make a big impact, to make him look as though he is waving, not drowning," a Labour source said.

Fianna Fail finance spokesman Michael McGrath warned that Mr Gilmore's political credibility was now on the line.

"It isn't tenable that the deputy head of Government would express disagreement with how the Revenue is doing something and then not do anything about it," he said.

"The Tanaiste, if he is to retain his political credibility, must be seen to deliver on his promise; otherwise he will be seen to have been engaging in political posturing to gain cheap credit."

Mr McGrath slammed "the highly public way" Mr Gilmore raised the issue, saying: "I would much prefer to see such actions being done quietly, instead of being done on the public stage in the pursuit of political capital."

Fine Gael figures believe Mr Gilmore was not showing leadership with his call.

"There are several ways in which people can pay the property tax. It's the same lead-in time to January 1. This is about people who didn't tick the box," a minister said.

There is also a belief that Mr Gilmore has made it even more difficult for Revenue to row back.

"I can't see how they can. How could they possibly change now in response to political pressure? They are independent. It's harder today than it was yesterday," a source said.

Junior Fine Gael minister Michael Ring expressed serious concern about the impact the Revenue letters would have on pre-Christmas trading, saying: "It was ill-timed just when we are hoping for a bit of a pre-Christmas spark, I would expect it to be clarified."

Social Protection Minister Joan Burton said there would be plenty of opportunities to make it clear that people are not being expected to pay next year's tax this year.

"The Budget had left people with a lot of clarity on their disposable income before Christmas. From a consumer-confidence point of view, the message needs to go out very clearly and swiftly that this tax does not have to be paid until next year," she said.

Fine Gael TD Michelle Mulherin said yesterday that the queries she was getting to her constituency office came from people who were trying to pay the tax but had technical difficulties with the system.

"There seems to be hiccups with people using their property tax IDs. There has been frustration. There does seem to be a few problems," she said.

Transport Minister Leo Varadkar also expressed frustration at his dealings with Revenue, saying he had not got satisfactory answers to queries from constituents.

A senior government source told the Sunday Independent there was a need to ensure a clear message is sent out next week.

"There was a vacuum last week when Joe Duffy took the matter up, people who didn't even get letters were starting to protest," the source said.

"The Revenue needs to communicate very strongly that not only is it possible to pay your property tax next year but that this is also the core idea they were trying to set out," a minister said.

A source close to the heart of Government said there should have been a public campaign prior to the release of the letters.

"The whole affair resembles the shambles where Revenue said they would be examining the tax affairs of pensioners and a million were up in arms – until it was clarified that only 10,000 would be affected," the source said.

A Fine Gael minister also noted that the issue had been "communicated badly" by Revenue.


- Fionnan Sheahan and John Drennan

Sunday Independent

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