Tuesday 23 July 2019

Murphy leaves Madigan's plan for lower property tax for rich on table

Housing Minister Eoghan Murphy. Photo: Doug O'Connor
Housing Minister Eoghan Murphy. Photo: Doug O'Connor
Cormac McQuinn

Cormac McQuinn

Housing Minister Eoghan Murphy has left a Fine Gael colleague's proposal to charge a lower property tax rates for homes in affluent areas on the table.

Fianna Fáil is demanding clarity on the Government's plans for the Local Property Tax (LPT) and accused Fine Gael of "playing games" on the issue.

The Departments of Finance, Housing and the Taoiseach, along with the Revenue, are reviewing the LPT system. Officials are to report to Finance Minister Paschal Donohoe in the coming months.

The rates paid by households are based on valuations after the economic crash but prices have risen considerably since then. There are fears people will be hit with massive LPT hikes next year if the system is not changed.

But Culture Minister Josepha Madigan, says she wants to see a lower LPT rate in areas with the highest house prices.

"Residents of south Dublin, for example, should be entitled to reliefs as they could be most affected," she said. The proposal sparked criticism from Opposition politicians.

Property prices in parts of Mr Murphy's own Dublin Bay South constituency like Ranelagh and Ballsbridge are also among the highest in the country. However, he has refused to comment on whether or not he supports Ms Madigan's suggestion, thereby leaving the proposal on the table.

A spokesman said: "Minister Murphy is involved in the review of the LPT and so cannot comment on specific proposals."

Ms Madigan is not the only minister who has entered the debate over the future of LPT.

Her constituency rival, Independent Alliance Minister Shane Ross, has sought exemptions for pensioners who are on a fixed income.

Fianna Fáil criticised the Government for not providing clarity on the future of the LPT for householders and local authorities, saying an announcement had been expected in last October's Budget. Its housing spokesman, Darragh O'Brien, claimed: "There's no reason why this review shouldn't have been published already and Fine Gael has been playing games with this."

He raised suspicions that Fine Gael is planning to time an announcement that property taxes won't increase just before the local elections.

Party colleague Michael McGrath argued that ministers like Ms Madigan and Mr Ross are calling for changes the Government is responsible for bringing about.

He said the Government "needs to be coherent and businesslike on this issue", to agree a collective position and explain it to the public.

Mr McGrath was asked about comments by Taoiseach Leo Varadkar that changes in the bands and rates in LPT could mean people could see no increase or perhaps a modest increase or decrease in 2020 after the revaluation.

Fianna Fáil's finance spokesman said: "Talk is cheap. We are now in 2019. People want to know where they stand."

Mr Donohoe has said any changes will be "affordable and predictable". Last night, a Department of Finance statement said the review of the LPT is being finalised by officials and will be presented to the minister shortly. It said the residential property revaluation date is November 1.

"The Government will make its position clear so that households will know well advance what its plans are for LPT," it added.

Irish Independent

Today's news headlines, directly to your inbox every morning.

Also in this section