Taoiseach rules out major property tax hikes
Leo Varadkar said the overall sum collected through property tax would remain the same after this year’s review of house values.
Homeowners will not face huge hikes in property tax when house prices are reviewed later this year, Taoiseach Leo Varadkar has said.
Tax rates have been frozen since 2013 and house prices in many areas have soared in the intervening six years, with Mr Varadkar acknowledging there were concerns that bills would rocket when property prices are re-evaluated in November.
Mr Varadkar said the Government would introduce measures that ensured that would not happen. He said he wanted the total tax take collected by local authorities to remain at around the same level.
The Fine Gael leader also made clear that current exemptions for homes bought after 2013 will soon end.
Mr Varadkar has faced calls to ditch the controversial tax entirely or extend exemptions to cover older people who may be asset rich but cash poor.
“The main thing we want to avoid is anyone facing a significant increase in their property tax because we just don’t want that to happen,” said the Taoiseach.
“I know people feel that because house prices have gone up a lot in the last four or five years that it means their property tax will go up by that amount.
“We are going to make sure that doesn’t happen. We want to make sure that the amount of revenue collected by the local authorities from property tax is roughly the same and that would mean making sure nobody faces a sudden increase in their property tax.
“That would not occur until 2020 at the earliest in any case.”
He added “One thing we can do, though, and we will have to consider this in the new year, is removing the exemption from homes that were bought since 2013.
“Anyone who bought a home in 2013, 2014, 2015 does not pay property tax. That is not fair because they benefit from the same local services as everyone else. That was done for a particular reason in 2013 to encourage increased housing supply but that is now going in the right direction. So, we need to consider that and it will bring in extra money for local authorities.”
Mr Varadkar said the Government wanted to reform the system so local authorities retained all the money collected from property tax.
“At the moment, in urban local authorities and a few of the wealthier counties about 20% gets diverted to less well-off counties and we think there is a better way to do that,” he said.
“There would still need to be an equalisation fund to make sure those less well-off counties, particularly those down the western seaboard, don’t lose out but I think people would prefer to see the actual tax they pay going to their own local authority.”