John Perry (Sligo-North Leitrim, Fine Gael)

While no reports have been undertaken to date examining specifically the effects of local authority rates on business, Forfás compiled a report in 2008 on the cost of running retail operations in Ireland. The report found that local authority rates constitute up to 4% of business costs on the retail sector.

I take on board the Deputy's valid point on the costs associated with doing business and the number of vacant commercial properties. We are conscious of that. The Minister, Deputy Hogan, has undertaken a review to study closely the cost of doing business and how best we can reduce the cost of doing business. The implementation of a local government efficiency review is being taken on board now as well in terms of how we can ring-fence the costs of doing business in local authorities. That is very much at the behest of the local authority members. It is our intention to ensure the cost of maintaining a business and the percentage of the cost of retail sales should be reduced.

We are also conscious of the huge amount of excess retail floor area currently closed in main street Ireland. That is due to the boom and the unprecedented development of the tax incentives during the previous Administration which propelled a huge level of development way beyond the requirement. It is all about getting cost competitiveness and reducing the cost. We are focused on the impact of rates on the cost of doing business and it is our intention to move decisively to reduce those costs.

The progressive nature of rates and the model of how rates are charged is a technical area. It is not fully justified as to how that will create a benefit as against reducing the actual cost.

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