Fergus O'Dowd (Louth, Fine Gael)

That is fine. I agree that there should be a reasonable timeframe for the drawing up of amendments.

I thank Senators for their contributions to the debate. I assure them that I am mindful of the matters raised and look forward to examining them in greater detail as the Bill progresses through Committee and subsequent Stages. I am fully committed to working constructively with Senators to deal with these and further matters. I regret the timing of the publication of the Bill. However, it is necessary that the legislation is in place in advance of 1 January, as required by the EU-IMF programme of financial support for Ireland. That is why we are caught in this bind and why it must be done without delay.

No Government wants to be in a position where it is required to introduce new taxes or charges. Nor does this Government want to place an additional financial burden on households already living with the consequences of the austerity measures brought forward in recent budgets. However, we must be cognisant of the perilous financial position we inherited and which we must tackle. We can lay the blame for our financial situation at many doors, but that will not solve the problem. Nor am I suggesting that this Bill will do so, but it will contribute to a solution to our current difficulties. We are heavily reliant on the troika for the day-to-day running of this country and the bottom line is that it is a requirement of the EU-IMF programme that the Government introduce a property-based charge for 2012.

Rather than responding to each point on Second Stage, I propose to deal in detail with Senators' amendments on Committee Stage. However, I will respond to some of the main points raised. It has been said that the ideal in respect of any taxation measure is that it be equitable, simple and flexible. The measure before us today meets those requirements. The charge will be simple and cost effective to administer and simple to understand and comply with. While it will apply equally to the majority of households in the State, we have set the charge at the lowest possible level for 2012, which is €100. It will generate revenue on a continuing basis and will not be subject to the volatility we have come to associate with taxes on property transactions. In this sense, it has the flexibility to cope with changing economic conditions while maintaining a stable yield.

In response to Senators Brian Ó Domhnaill and David Norris, people in mortgage distress are being accommodated. Households in receipt of mortgage interest supplement from the Department of Social Protection on the liability date will be entitled to a waiver. All owners of a residential property will be liable to the household charge unless otherwise exempted or entitled to a waiver, as I outlined in detail. The Bill is estimated to generate some €160 million annually for the local government sector on full collection. Its importance cannot be underestimated for two main reasons - first, in terms of the potential revenue yield for the provision of local services; and, second, that it represents a new local source of funding for local authorities and reduces their dependence on central government. The latter is an important principle which we should all welcome.

The Bill does not include a valuation-based component. In light of the complex issues involved, a property tax requiring a comprehensive property valuation system would take time to introduce. Accordingly, in order to meet the requirements in the EU-IMF programme, the Government has decided to introduce a household charge in 2012. The amount of the charge is relatively modest at €100. It is an interim measure which will be replaced by a full property tax in due course. An interdepartmental group will be established in early 2012 to consider proposals for the property tax, which will include its scope, assessment criteria, applicability of exemptions and waivers and how the tax should be paid and collected. There will be an opportunity for input into the deliberations of this group. Having considered the group's proposals, the Minister for the Environment, Community and Local Government will bring his proposals to Government for consideration. The outcome of the Government's deliberations will be announced as early as possible in advance of the introduction of the tax, so that people will understand its implications having regard to their own personal circumstances.

I look forward to a high compliance rate with the obligation to pay the household charge. It is in everybody's interest. Moreover, it is simple common sense to pay it when it falls due given that evasion will incur significant late payment fees and penalty interest which will have to be paid at some point. The longer the delay in paying the charge the more expensive the late payment fees and interest will become. In addition, the resale of a property will be difficult if charges and late payment fees are left outstanding. A public information campaign will be undertaken nationally to advise people of their responsibilities in regard to the charge. This campaign will be undertaken by the Department and local authorities.

Senators Ó Domhnaill and Norris raised the issue of Committee Stage amendments. As I said, we are happy to co-operate in that regard. We have made great strides in the constructive and healthy exchange of views on the Bill. I look forward to teasing out the detail on Committee Stage.