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Finance (Local Property Tax) Bill 2012: Second Stage (Continued)

Friday, 14 December 2012

Dáil Éireann Debate
Vol. 786 No. 4

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(Speaker Continuing)

[Deputy Heather Humphreys: Information on Heather Humphreys Zoom on Heather Humphreys] I appreciate there is a provision to defer the tax, but for many older people, it is not in their nature to leave debt behind. Perhaps the Minister could look at some mechanism to take account of elderly people living alone. I also ask the Minister to consider also those who paid high levels of stamp duty that was subsequently squandered by the previous Government.

I wish to raise the issue regarding the executor of a will who has been charged with selling a house and dividing the sale proceeds between those who stand to inherit the moneys. Is it possible to ensure that persons acting in the capacity of executors of wills be included in the list of persons allowed to defer payment of the property tax, save where the executor of the will - and his or her spouse or partner - is the sole or joint beneficiary of the property concerned? This would eliminate persons deferring the payment of the tax indefinitely because they are also the only beneficiary of the property. This would also eliminate the need for executors to pay their own moneys in settlement of the property tax liability and while liability would continue to accrue, it would not become due until the property was disposed of. In such circumstances, would the Minister consider not applying a penalty?

Deputy Frank Feighan: Information on Frank Feighan Zoom on Frank Feighan After 14 years of reckless financial mismanagement of our economy, this country was in peril. This Government has a difficult job in trying to get the country working again. Taxes such as this one are very difficult to introduce. There is a very loud minority but there is also a silent majority who appreciate what needs to be done. They are sharing the pain, which is very difficult for each and every citizen.

There are no easy fixes and no soundbites that will get us back to where we were, but we must work together with a programme to get our country working again. It is not easy to introduce any tax but it must be fair and the Minister has done everything possible to ensure this property tax is fair. Many people have got into a frenzy and perhaps it is time for those in the media and on the social media to reflect the fact that we are trying to do a job in the most difficult circumstances. Tomorrow I will have 200 to 300 farmers at my door, but that is fine. I am able to face up to that because I believe I am part of a Government, with the Labour Party, that will ensure our country will be working again. I have no problem with standing up and fighting to ensure this country is back working again.

Deputy Andrew Doyle: Information on Andrew Doyle Zoom on Andrew Doyle I thank the Ceann Comhairle for the opportunity to speak on this Bill. We tend to forget that in 1977, when rates were abolished, their abolition was ridiculed as a political ploy and as economic recklessness. At the time I did not have a vote but I do remember people giving out, not about the rates per se but about the valuation method used. The old poor law valuation method was deemed to be archaic and out of date, which it was, and what it needed was reform rather than abolition. In 1977 we were recent entrants to the European Union, or the European Economic Community as it was then, and money seemed to be flowing in. It appears that we came to the conclusion, on the basis of money coming into Ireland in a never-ending stream, that we did not need the money collected by way of rates. We had the same situation after the advent of the euro, when people thought that money would flow in indefinitely. It was very easy and the Germans, the banks and others, who must bear some responsibility, decided that we were a good case for credit. Credit came in too freely without any proper oversight and we saw what happened.

  Deputy Eoghan Murphy and others have referred to the property tax as a services tax and I would like this tax to be called thus. I would also have preferred it if occupiers were duty bound to pay some of the tax because that would have given a far stronger signal that the tax is for the provision of services. Fundamentally, the tax should be for services for householders. The money raised should be ring-fenced, as far as possible, for the local authority in the area in which it is collected. Furthermore, the people who collect it and are charged with spending it should be accountable to the public.

  We need to look at fine-tuning the deferrals because there are many people who do not have an ability to pay and who paid dearly in terms of stamp duty on their houses. I know of a person who was not a first-time buyer and one third of his significant mortgage was for stamp duty. We must also evaluate the tax on an ongoing basis. Finally, I ask the Minister to clarify the issue concerning how far the powers of the Revenue Commissioners extend with regard to collecting the tax.

Deputy Robert Troy: Information on Robert Troy Zoom on Robert Troy As a relatively new Member of this House, I am deeply frustrated and disappointed by the manner in which the Government has scheduled debate in the House this week. As an elected representative of my constituency, I was given a mandate to represent the views of the constituents of Longford-Westmeath. This week, two very important issues which will affect every family, not just this year but for many years to come, have been guillotined. I was lucky enough to get five minutes to speak on the Social Welfare Bill and now I am lucky enough to get seven or eight minutes to speak on the Finance (Local Property Tax) Bill. The latter legislation will have serious ramifications for years to come but is being rushed through this House, despite that it will not come into effect until June 2013. This legislation should have been debated in the context of the Thornhill Report, which has been sitting on the Minister's desk for months and which he has not had the courtesy to make available to other Members of the House. By curtailing debate in this House, the Government is effectively telling the people it purports to represent that it does not wish to hear their views. Are we living in a dictatorship?

Admittedly a form of property tax was part of the original memorandum of understanding with the troika, but this Government has proven that the memorandum can be renegotiated. To its credit, the Government renegotiated on the minimum wage, on which I congratulate it. We all know the troika wants the targets to be met and my party supported the Government in its €3.5 billion correction this year. We also produced a costed alternative, A Fairer Way to Recovery. When Government party Deputies claim our proposals were not costed, are they telling the people that the replies to parliamentary questions are inaccurate? All our information was obtained through the Department of Finance and through parliamentary questions.

When the Government parties drew up their 2011 election manifestos, what did they say? Fine Gael said "an annual recurring residential property tax on the family home is unfair". The Labour Party, while it agreed with a site valuation tax, argued that further detailed study would be required to provide a fair basis for such a charge that would take account of the value of the property in different regions, the need to exempt some categories of home owners and the need to take account of those who recently paid large sums in stamp duty or who are in negative equity. That party's manifesto stated that such a charge could not be put in place "before 2014". Both party's positions have changed quite significantly since then, but then again, their position on many policy issues has changed significantly since 2011. The Minister for Communications, Energy and Natural Resources, Deputy Rabbitte, said on television last weekend that it is okay for politicians to say one thing in the lead-up to an election and, once elected, to do a totally different thing.

My party's position has changed from where it was then. We believe this is a wrong tax at a wrong time. It is a tax on the family home which will hit struggling home owners at a time when they can least afford it. It will further suffocate a property market which is on its knees. It will reduce domestic spending and will, ultimately, damage the economy.

Let us look at the people who cannot pay this household tax. Figures released this week by the Central Bank show the true extent of the mortgage arrears crisis.


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