Paschal Donohoe (Dublin Central, Fine Gael)

When local property tax was introduced in 2013, the Government decided that a liability to the tax should apply to all owners of residential properties with a limited number of exemptions and no deductions. Limiting the exemptions available allows the rate to be kept low for those liable persons who do not qualify for an exemption. The proceeds of the local property tax are largely used for the general provision and maintenance of infrastructure, services and amenities in a local authority area. Accordingly, residential property owners and estates not yet taken in charge benefit from the expenditure of those proceeds in the same way as other owners of other residential properties in the general locality in terms of the provision of public roads, footpaths, lighting, open spaces, surface water drainage and other public amenities. That is why the local property tax is payable regardless of whether an estate has been taken in charge.

A requirement to pay a management fee or a service charge to a property management company is not relevant in determining whether a property is subject to LPT. Accordingly, while those who are liable for these payments may be exempt from LPT for another reason or may be entitled to avail of a deferral arrangement, there is no specific exemption for the payment of management fees, nor is there provision to offset the amount paid on management fees against local property tax.

This matter has been looked into in the past by the interdepartmental review group with regard to LPT and it did not recommend that persons who pay management fees be afforded relief in respect of local property tax. For those reasons, I do not propose to accept this amendment.

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