Simon Harris (Wicklow, Fine Gael) | Oireachtas source

He may be back. From 1 January 2015, local authorities have had the discretion to vary the local property tax rate by plus or minus 15%. Several authorities have exercised this option and between its inception and the end of 2015, the LPT is expected to have contributed more than €1 billion to the funding of local authorities. I note, however, that some will apply a smaller, or no, rate reduction in 2016. This is an example of local authorities being empowered to make decisions about their communities, deciding whether the national rate is good enough or whether it should be put up by 15% because they want to improve local facilities, such as providing new pavements or a playground, or whether they should give households a break and reduce the rate by 15%. Local authorities have made different decisions. That is the purpose of empowering local government to make those decisions. It is a local tax. In regard to compliance rates, Dr. Thornhill's recent review indicates that the compliance rates for the local property tax in the years 2013, 2014 and 2015 are estimated to be more than 95% and the number of compliant properties are estimated to be at 1.87 million, 1.87 million and 1.86 million for 2013, 2014 and 2015, respectively. This level of compliance reflects positively on the strategic and operational management of the local property tax and demonstrates public confidence in our Revenue Commissioners and, indeed, the effectiveness of the Revenue Commissioners in doing the job they are entrusted to do by the State.

For individuals on low incomes, the local property tax legislation provides for the possibility of deferring the charge in some cases. To qualify for a deferral, the residential property must be occupied as a sole or main residence. The income thresholds for a full deferral are €15,000 for a single person and €25,000 for a couple who are married persons, civil partners or cohabitants. An increased income threshold applies in the cases of properties occupied as a sole or main residence that is subject to a mortgage. In such cases, the gross income thresholds may be increased by 80% of the mortgage interest payment. A deferral option in qualifying cases in this regard will apply until the end of 2017 and will assist individuals currently in mortgage distress. Furthermore, a deferral of up to 50% of the local property tax liability is possible where the gross income of the liable person does not exceed €25,000 for a single person or €35,000 for married persons, civil partners or cohabitants. A deferral of 50% of the local property tax liability is also available where gross income does not exceed the above thresholds, as increased by 80% of the gross mortgage interest payments that a liable person expects to make by the end of the year for which the gross income is being estimated. This mortgage linked partial deferral will also be available until 31 December 2017.

I will now try to deal with some of the issues raised. I do not want to get into all of the flooding issues now but Senator Healy Eames raised an important issue in regard to Galway. The Dunkellin flood relief scheme is a priority scheme, for which funding is in place. We are waiting for An Bord Pleanála to make a decision in regard to planning. I do not want to say anything that will interfere in that process but I hope the decision is made as quickly as possible so that we can get on with that work because I know how much the people of Craughwell are suffering and have suffered in the past. I take the point the Senator made in that regard.

On the issue of disability, this is a self-assessment tax. Disability, as defined in the Disability Act 2005 in regard to a person, means a substantial restriction in the capacity of the person to carry on a profession, business or occupation in the State or to participate in social or cultural life in the State by reason of an enduring, physical, sensory, mental health or intellectual impairment. In regard to a deaf or blind person, I cannot be overly prescriptive on this, as it is self-assessment. However, it is about whether the home needs to be adapted and whether that has added value or whether the person needs to live in a particular type of house to meet his or her disability needs. However, what this legislation is doing is lessening that burden and easing those restrictions on people so that they do not have to jump through as many bureaucratic hoops. If the Senator has specific cases to pursue with me, she should feel free to do so.

In response to Senator Norris, all of the LPT raised goes to the councils. At least 80% of the amount raised in a local authority area goes to that council area and the rest is distributed to other local authority areas. In other words, the wealthier councils support the less wealthy. This decision was taken when the Act was introduced. Senator Quinn made a point regarding derelict houses. I am advised that the LPT is a self-assessment tax and it is, therefore, up to the home owner to decide that the house is uninhabitable. Revenue must have the authority for ensuring compliance or anybody could say his or her house is uninhabitable. Common sense must prevail. Revenue has the opportunity to check the veracity of such assessments if it considers there is a need to do so. It is up to Revenue to make that decision. Situations vary and must be considered on a case by case basis.

Senator Reilly asked for my view on the Thornhill report in regard to local property tax. We will outline that in detail for her in our manifesto and during the election campaign. However, I can inform her that we will not be making any false promises to abolish property taxes. We believe property tax is a stable form of income. I also believe this Bill addresses a number of concerns in regard to pyrite, the assessment date and disability. However, there is a need for a debate on the future of this tax, what form it should take and how it will deal with rising property prices post-2019.

Senator Barrett made a point he feels strongly about in regard to inversions and international taxation. The OECD BEPS process provides an opportunity for us. Country by country reporting will enable the Revenue Commissioners to have information available to them, not just on what a multinational company pays in this country but also in every other country in the process. That will give our tax authority a level of insight and overview that neither it nor other authorities have had up to this point.

I have tried to cover most of the points raised. There are some points on which we disagree and we may get to them on the next Stage of the Bill.