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

The Government decided to have one standard rate of tax for the country as a whole, based on the value of houses. At present, as the Deputy will be aware, some of the funding for local government comes from motor taxation. The incidence of motor taxation falls heavily on the Dublin area and on the main urban centres also. The difference here is that unlike motor tax, which goes into a fund which is allocated around the country, it is the intention that arrangements will be made between the Minister for Public Expenditure and Reform and the Minister for the Environment, Community and Local Government, to ensure that the tax is spent where it is collected. It will take some time to get to the figure quoted by the Deputy.

The intention is that the full amount of the tax will be spent where it is collected. It is a major reform in local government that those who pay most will have funding for the most services. In addition, from 2015, local councillors will have discretion to increase or reduce the rate of the tax by up to 15%. That will give real power to councillors. Future Governments may decide to give more discretion in that regard but, in accordance with the Act, full discretion amounts to plus or minus 15% at present.

With regard to the other issues raised, the Office of the Revenue Commissioners realises this matter is quite complex. It wants as much assistance as possible for taxpayers so it will be operating a significant number of helplines. It will be necessary for employers who deduct the tax at source to change their payment systems, but this is no different from what they must do if VAT, personal taxes, PRSI or the universal social charge are changed on any budget night. The Office of the Revenue Commissioners has never paid for this facility. Employers are obliged to collect taxes and pass them on to the Revenue Commissioners. There is no question of agency payments being available for these facilities. The Minister for Social Protection has already made or is making arrangements within her Department so there will be an easy payment facility available through the social welfare system, if desired. The payment date is 1 July, which is a long way down the road.

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