Michael Healy-Rae (Kerry South, Independent)
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To ask the Minister for Finance if his attention has been drawn to the fact that all local authorities must now make an allowance in their estimates to pay the property tax on local authority houses and that this will put a further burden on the rate payers if the moneys have to be paid and it will result in services being cut; and if he will make a statement on the matter. [58050/12]

Michael Noonan (Limerick City, Fine Gael)
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In accordance with Section 11 of the Finance (Local Property Tax) Act 2012, local authorities will be liable to pay the Local Property Tax (‘LPT’). I am informed by the Revenue Commissioners that they are liaising with the Department of the Environment, Community and Local Government on the mechanisms by which local authorities will pay the tax due. Local authority owned properties have not been exempted from the LPT and they may increase rents to ensure that tenants of such housing units make a contribution to LPT, and to avoid anomalies that may otherwise have arisen. For example, in instances where local authorities owned and rented out a property in an otherwise privately owned housing estate, the tenant in such a property would not have been subject to the local property tax, while residents in other properties would have been subject to it, whether directly as owners or indirectly as occupiers of private rental properties. Such a situation would have clearly been unfair, and it is to avoid such issues that local authorities are liable to pay the LPT.

It is clear that local authorities require sufficient funding to ensure that they can operate effectively across their range of functions and responsibilities, and the introduction of the Local Property Tax is designed to achieve this goal. Income from the LPT will accrue to the local authorities to fund local services. It will be the responsibility of each individual local authority to manage its budget appropriately, taking into account the income and liabilities that may arise from the LPT.