Michael McGrath (Cork South Central, Fianna Fail) | Oireachtas source

I wish to speak initially to amendment No. 50, which proposes that the local property tax, LPT, would be a deductible expense for landlords when calculating their taxable rental income. There is something of a political consensus in this country that landlords should be hammered into the ground in so far as possible, but of course that has one very direct consequence, namely, that rents continue to increase. The issue should be addressed. It was recommended in the Thornhill report that LPT would be tax deductible for landlords. The Minister has signalled by way of reply to parliamentary questions that he is in favour of such a measure, in principle. I suggest the Minister would make a move in that direction in the Finance Bill.

Amendment No. 51 is similar to an amendment we discussed on Committee Stage. It relates to the valuation date in the local property tax legislation of 1 November 2016. As the Minister is aware, properties are currently valued in respect of the LPT as of May 2013 and they are locked into the relevant band for another two years up to 2016. People will be required to revalue their properties in 2016. Given the direction in which property prices are going, that will become a very serious issue, in particular in urban areas and most acutely in Dublin, but also elsewhere. Since the May 2013 valuation, property prices in Dublin have increased by at least 40%. We can see from statistics available today that prices in Dublin have increased by 24% in the past 12 months and now prices are beginning to rise at an accelerated pace elsewhere in the country.

I accept there is still time to deal with the issue because the amount people have to pay next year and in the following year is fixed and nothing we do in the Bill can change that. However, people essentially face a time bomb. For every band one jumps up in the LPT, one pays an additional €90 per year and some people certainly face the prospect of going up by two bands, which would mean an increase of €180 per year. The Government has been of the view to provide certainty for people for the next four years on water charges but they do not have the same certainty on the property tax. Many Government backbenchers, especially in Dublin, are very exercised about the issue. The Minister could provide clarity now that there will not be a further valuation of properties required in 2016, by way of accepting the amendment. Amendment No. 52, which is related, is essentially a repeat of amendment No. 50 and therefore I intend to withdraw it.

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