Monday 21 October 2019

Fine Gael candidates pledge to cut property tax in their area in 'cynical' bidding war

Fine Gael election candidates will campaign on a promise of fighting to reduce the Local Property Tax in their area, the Irish Independent can reveal. (Stock photo)
Fine Gael election candidates will campaign on a promise of fighting to reduce the Local Property Tax in their area, the Irish Independent can reveal. (Stock photo)
Kevin Doyle

Kevin Doyle

Fine Gael election candidates will campaign on a promise of fighting to reduce the Local Property Tax in their area, the Irish Independent can reveal.

A draft version of Taoiseach Leo Varadkar's manifesto for the local election commits its potential councillors to working towards lowering Local Property Tax (LPT) rates.

The move goes directly against a key recommendation in a Government report which says the ability of politicians to cut property taxes should be taken away.

The Fine Gael promise is likely to seen as the start of a cynical election bidding war in the campaign, which officially begins today ahead of voting on May 24.

Property tax is seen as a hot-button issue, particularly in urban areas where house prices have risen dramatically in recent years.

Households are currently paying LPT based on the value of their property in 2013 - but a revaluation was due to take place next November.

Earlier this month, Finance Minister Paschal Donohoe postponed any changes to the current regime by another 12 months.

That delay is reflected in the Fine Gael manifesto, which states homeowners will continue paying their existing rates until 2021.

"This deferral is to build consensus for changes to LPT," the draft document, seen by the Irish Independent, states.

It goes on to say Fine Gael is committed to "a fair Local Property Tax".

"Fine Gael councillors will work to ensure that, where possible, the LPT rate levied by the council is reduced," the manifesto says.

Currently each council has the option of increasing or reducing the tax by a maximum of 15pc.

The four local authorities in Dublin, where property prices are highest, have dropped their rates for 2019 at a total cost of €28.4m.

But an inter-departmental review, on which changes to the LPT system will be based, advocates the 'Local Adjustment Factor' should be amended "to permit upward- only adjustments to a maximum of 15pc".

Both Mr Donohoe and Mr Varadkar have publicly stated in recent weeks that they do not support this approach.

Mr Varadkar told the Seanad last Thursday that he trusts councillors "to have more autonomy when it comes to the LPT and allow them to vary it by a greater percentage".

"Interestingly, as many councils have varied the LPT upwards as well as downwards," he said.

However, the draft manifesto indicates Fine Gael councillors across the country will favour reductions.

It says: "Upward local council adjustments will only be approved by Fine Gael councillors where it will deliver new specific and additional services - eg, more street cleaning, greater CCTV for communities."

The manifesto also says that most homeowners will see "no increase or a very modest one in 2021".

Fine Gael will be seeking to regain its position as the biggest party in local government next month, having ceded control of many county councils to Fianna Fáil in 2014.

Under Enda Kenny, the party lost 105 seats in what was viewed as a kickback against its then coalition with the Labour Party.

Irish Independent

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