Michael Noonan (Limerick City, Fine Gael) | Oireachtas source

There has been some recent commentary about tenants in local authority dwellings receiving local property tax, LPT, returns. I welcome the opportunity to clarify matters and set out what they need to do. The Finance (Local Property Tax) Act 2012, as amended, sets out how the tax is to be administered and provides that a liability for LPT will arise where a person owns a residential property on the liability date, which will be 1 May 2013 for the year 2013. Section 7 of the 2012 Act provides that local authorities will be liable to pay the LPT on their properties in the same way as any other residential property owner, unless the properties in question are used to accommodate people with special housing needs, such as the elderly or people with disabilities.

A key aspect of the work undertaken by the Revenue Commissioners in implementing LPT was the development of a comprehensive register of residential properties in the State. The register was developed using data drawn from a range of sources, including the Revenue Commissioners' own databases, the Local Government Management Agency database and data from utility companies. Data from the various sources have been cross-checked to ensure the register is as accurate as possible. It is being used to issue correspondence to property owners and work is still in progress to refine it.

I am advised that in developing the register, the Revenue Commissioners collaborated with all local authorities to establish details of properties owned by the individual local authorities in order that they could be excluded in the first instance from the general issue of returns, so as to ensure tenants of local authority properties did not receive LPT returns. While every effort has been made to match local-authority-owned properties with the LPT register, in a certain number of cases that matching process has not been successful and some tenants of these properties will have inadvertently received the return from the Revenue Commissioners. I am further advised that this particular possibility is covered extensively in the letter and the information booklet that accompanies the LPT return. The correspondence advises anyone who receives an LPT return from the Revenue Commissioners but is not the liable person in respect of a property of what steps he or she should take. It is important that the person does not ignore the return. This means that a tenant who receives a return in error should advise the Revenue Commissioners that he or she is a local authority tenant. This will allow the Revenue Commissioners to match the details to the local authority data and correct the LPT register.

I am advised by the Revenue Commissioners that local authority tenants who are receiving LPT returns in error are advising it of that fact, and it updates the register accordingly.

Where a local authority is liable for the LPT charge on residential properties it owns, I introduced changes to the 2012 Finance (Local Property Tax) Act that provide that the market value of any such property will be deemed to fall into the lowest valuation band of zero to €100,000 up to and including 2016. This will result in a LPT charge of €45 per property for 2013 and €90 per property per year for 2014 to 2016. It will be a matter for local authorities to decide whether to pass on the LPT liability to their tenants in the form of an increase in rent or whether they will absorb the liability without recourse to their tenants. In addition, the Act also gives local authorities until 1 January 2014 to pay the 2013 tax.

The Deputy also makes a reference to incorrect valuations. I am informed by the Revenue Commissioners that in the first instance the LPT is a self-assessed tax. This means that the property owner must decide the market value of his or her own property and make a return to Revenue. I have advised the House on previous occasions that Revenue is not issuing valuations of individual properties. In the absence of a national residential property valuation system, the valuation guidance developed by Revenue is designed to help property owners to assess the market value of their properties by giving them average, indicative values for their areas. Additional supports include the property price register provided by the Property Services Regulatory Authority at www.propertypriceregister.ie, the property sections of local newspapers and information from local estate agents and property websites which have been referenced by Revenue.

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