Tuesday, 16 October 2012

Councils will be able to set their own rate of property tax

ENVIRONMENT MINISTER PHIL Hogan has said that local authorities will be able to set their own rates for property tax in the future.
The move will mean different councils will be able to charge different rates, depending on the services they provide and the amount of money they need to collect.
Speaking at the launch of theGovernment’s plan to overhaul local government, Phil Hogan said that local authority services will become more and more reliant on income which will be raised from the property tax as  the government aims to reduce the amount of money councils receive from the Exchequer. Currently four out of every ten euro spent by local authorities comes from the central Exchequer.
Property tax is due to be introduced on 1 July next year with the exact details of the rate due to be confirmed on Budget Day on 5 December.
“If [local authorities] are raising the money locally for a particular service provision they will have a say in relation to how they spend it,” said Hogan.
“Therefore each local authority can have a different level of property tax in due course”.
Phil Hogan said that the timing of when councils will be able to set their own rates will be a matter for the government.
The Minister also said that the planned changes will be the biggest overhaul of local government since the Victorian era. He said:
What we had wasn’t a bad system of local government. It as a good system but just built for a very different time. If you think about it, what other aspect of the infrastructure affecting the lives of every citizen in the State has been left unchanged and unchallenged since the nineteenth century?
He said that the Fianna Fáil-led government of 1977 had made a “disastrous” decision to cut the link between local tax and local service for electoral gain, which had led to much of the malaise that exists in the local government system today.
Tánaiste Eamon Gilmore said that the current system is undemocratic and not sufficiently responsive. “Local Government does too little governing,” he said. “The limited role that councils have in issues like job creation of community development undermines its credibility with the public”.
Under the plans released today, the number of councils will be cut from 114 to 31 with the number of councillors reduced by almost half.
Existing town councils will be abolished and replaced by a municipal governing body. The government says that the plans will save the State €420 million over four years.

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