Tuesday 19 March 2019

Minister challenged on plan for property tax exemptions

Fianna Fáil and Labour criticise Alliance for 'populist demands'

Questioned proposal: Fianna Fáil’s Michael McGrath. Picture: Collins
Questioned proposal: Fianna Fáil’s Michael McGrath. Picture: Collins

Cormac McQuinn and Ralph Riegel

Fianna Fáil has challenged the Independent Alliance to explain how it would fund a proposed exemption from property tax for hundreds of thousands of pensioners.

Michael McGrath, the party's finance spokesman, also questioned if other householders would face hikes in their bills if the plan was implemented.

Labour branded the exemptions proposed as "populist".

The suggestion from the Independent Alliance, which includes Transport Minister Shane Ross, came in a submission to the Department of Finance amid an ongoing review of the Local Property Tax (LPT).

It would see householders aged over 66 on a fixed income, and people with disabilities, get "full exemptions" from LPT.

It is also seeking a cap on charges, saying that homeowners should not be forced to pay "a single euro more" when the re-evaluation of property prices is finished.

Mr McGrath said his party wants to hear more details on the proposals and challenged the Independent Alliance to say how it would be paid for.

He asked if introducing full exemptions "would mean other groups of people would face a major hike in their LPT bill, or is it the case the Alliance favours a significant drop in the overall amount of LPT collected by the State?"

Mr McGrath also questioned the impact on local authority services if the Exchequer "can't make up the difference".

"We need more details of what is being suggested and how exactly it would be funded," he said.

Labour leader Brendan Howlin accused the Independent Alliance of making "populist demands" and "firing the first shot to fatally undermine taxation of wealth in Ireland by seeking large exemptions".

He claimed the Independent Alliance proposal for a so-called 'granny grant' childcare payment had failed and added: "It is obviously seeking other ways to boost its popularity without any thought to the consequences."

Attempts to get a response from the Independent Alliance and Mr Ross were unsuccessful last night.

Meanwhile, speaking at an event in Cork, Tánaiste Simon Coveney refused to be drawn on the Alliance's LPT plans.

He said the Government has a lot of decisions to make around taxation and finance generally with the Budget.

Mr Coveney said the Government has to "make sure that we protect ourselves from potential risks such as Brexit and others...that we have a sensible, sustainable economic model that lasts this time - and that bad politics doesn't break that.

"So, it is in that context I will have a contribution on property tax like many other areas as well.

"I think the Cabinet table is the place to have that discussion."

The LPT is currently being charged based on the value of a person's home in 2013.

There are fears that the increase in house values since then will lead to massive tax hikes for homeowners and the LPT system is being reviewed.

A spokesman for Finance Minister Paschal Donohoe last night said the Independent Alliance proposal "will be dealt with in the context of the LPT review".

He added that the minister "has signalled his intention that any changes to be introduced in 2020 will be moderate, affordable, will give certainty to people and will be well flagged in advance".

Irish Independent

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