Tuesday 17 September 2019

Philip Ryan: 'Fine Gael's decision to delay property tax reform could come back to bite TDs'


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Philip Ryan

Philip Ryan

A couple of months back, newly elected Dublin City councillors voted to keep all revenue raised from property tax collected from homeowners living in the capital.

The vote was more symbolic than anything, as councillors know that they will have to hand over 20pc of all property tax they raise to the Department of Housing.

This funding will then be dispersed among rural local authorities that are struggling to balance their budgets. The department's equalisation fund fills the funding gaps which some rural councils can't make up from their own resources.

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But in doing so, the fund has created rivalries along county boundary lines that are generally reserved for the GAA football championship.

Dubliners and Corkonians, who fork out large sums every year in property tax, naturally wonder why their hard-earned money is funding a housing development or new road in Tipperary or Donegal.

The housing crisis, after all, is most acute in the two main cities, yet millions of euro are being taken from urban local authorities, who some would argue need it most.

There is also the not inconsequential fact that city dwellers pay far higher rates of property tax than those living in rural areas. According to the Department of Housing's forecast for next year, property owners in Dublin could be paying three times more on average than those living in Donegal, Leitrim or Cavan.

The Government has already promised to make the system fairer but, as we know, they cynically delayed making any decision on property tax until after the next election for fear of upsetting voters. However, it might come back to bite Fine Gael.

Fianna Fáil led the charge in Dublin City Council when councillors sought to retain the entire revenue from property tax while Fine Gael voted against the move.

Property tax will be a key battle ground in the next election and the lines are already being drawn.

Irish Independent

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