Paul McAuliffe (Dublin North West, Fianna Fail) | Oireachtas source

I welcome the Minister. As Fianna Fáil spokesperson on local government, I welcome the opportunity to contribute to the debate.

In 2013, I and many of my colleagues on Dublin City Council described this as the wrong tax at the wrong time. The timing was obviously very difficult for many people but the tax was a market value-based tax rather than a site value-based one. The Bill before us defines one of the real issues with the current system, namely, it will require us to constantly review the valuations. There is much work still to be done on the local property tax and we should look at more innovative, progressive and different ways to use our local property tax. I accept, however, even with Covid and everything else, that now is the time for us to take the difficult decision to amend the valuations and to get on with doing so.

I should acknowledge that the Government has made a significant attempt to ensure that the vast majority of people will not pay more tax as a result of this Bill or the revaluations that will take place. That is a significant achievement given the significant increase in property values over that time. The second thing is, we should acknowledge that while there are some people who have not paid the local tax since 2013, they will be covered by this new scheme. That will be a significant hit for many of those people. While some might say that those people have not paid it since 2013 and the rest of us have, I acknowledge that this will be significant for people, that they will be making a payment they have not made before and that this is a very difficult time for some of them to do so.

That said, I also want to discuss how this tax is spent. There are two positives in here. One is the ending of the equalisation fund, which will ensure that 100% of the taxes raised in the local area will stay in the local area. That is really important because one of the fundamental tenets of how this tax was sold to people was that it would help fund the services in their area. Restoring 100% retention in places like Dublin and in many counties will ensure that money is spent in the local areas and councillors will welcome that. However, councillors and communities will only welcome it if it genuinely does stay in their communities. Two things must happen for that to be the case. First, we must not replace existing grants and funding streams by looking at what increased funding councils will get from this scheme and, second, we must ensure that we match the shortfall in the local government fund to ensure those counties which will now not receive that overflow are correctly funded. At the committee, I think it was estimated to be in the region of €90 million. This is a significant amount and we must start looking now at how we will address that so there is a genuine benefit to this Bill, that more money is kept locally and that where money does not come from the equalisation funds, it will be replaced by a commitment from Government.

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