Phil Hogan (Carlow-Kilkenny, Fine Gael)

The Bill contains 20 sections and is a relatively straightforward piece of legislation, which will be easy for Deputy Higgins to understand. Essentially, owners of liable residential property will be required to pay to the Local Government Management Agency an annual charge of €100. I consider it important to minimise the costs associated with its collection. Accordingly, county and city councils will delegate their functions in administering the charge to one body, the Local Government Management Agency, which will be paid the costs of administering the charge from the proceeds of the household charge.

As there is no existing database of residential property ownership in the State, the Local Government Management Agency cannot issue bills or invoices. In this regard, the charge is a self-assessment measure and it is for the owners of residential property, in the first instance, to assess whether they are liable to pay the charge. Nonetheless, the charge is relatively simple and straightforward and is easy to understand. In addition to the normal sanctions involving a fine on conviction of an offence, the Bill incorporates late payment fees and late payment interest provisions which should act as a real incentive to pay the household charge when it is due.

From a drafting perspective, the Bill starts from a position where all residential property is liable for the household charge. It goes on to exempt certain buildings and owners from this liability. To put it another way, it identifies what is not liable within the totality of residential buildings, rather than taking as a starting point buildings and owners that are liable. These include, in section 2, properties which are owned by a Minister of the Government or the HSE, or are vested in local authorities or voluntary and co-operative housing bodies for social housing purposes. Other exemptions to the charge are provided for in section 4, including properties owned by charities and certain discretionary trusts, and where a person has to leave their home due to long-term mental or physical infirmity. Waivers are provided for persons in receipt of mortgage interest supplement or residing in certain unfinished housing estates on the liability date. The household charge will apply to immovable property and, as such, mobile homes and vessels are exempted from the household charge.

The Bill provides that the charge shall be paid to the county and city councils under section 3. However, local authorities will delegate their collection functions to the Local Government Management Agency under section 13. In the event of non-payment of a household charge for which a person is liable by a certain date, section 7 sets out that late payment fees and late payment interest of 1% per month, or part thereof, will apply to unpaid amounts. The late payment fee to apply in the case of a household charge paid not later than six months after the due date is 10% of the amount outstanding; in the case of a household charge paid later than six months and not later than 12 months after the due date, it is 20% of the amount outstanding; or in the case of a household charge paid later than 12 months after the due date, it is 30% of the amount outstanding. These penalty provisions are proportionate to the level of the household charge and are similar to the provisions that apply under Revenue legislation in respect of the late filing and payment of certain taxes. They will act as an incentive to pay the self-assessment household charge on time.

The rolled-up amount of a late payment fee should not be underestimated and non-payment of a charge for a period of two years will result in a liability of some €280 when account is taken both of the charges, the late payment fees and late payment interest. I want the message to go out clearly to those who are liable to pay this necessary household charge on time, rather than incur late payment fees. Local authorities will also have power to take prosecutions against owners who fail to discharge their liability to pay the charge. Prosecution will be by way of summary proceedings and a court may impose a class C fine, under the Fines Act 2010, which ranges from €1,000 to €2,500.

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