Michael McNamara (Clare, Labour)
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108. To ask the Minister for Finance if there is any legal impediment to local authorities passing on, or charging a levy in respect of, the local property tax payable in respect of local authority owned properties to the tenants thereof; and if he will make a statement on the matter. [55297/13]

Michael Noonan (Limerick City, Fine Gael)
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Local authorities are liable for the Local Property Tax (LPT) as owners of residential properties. However, an exemption from LPT applies where such properties are used to provide "special needs accommodation", meaning properties provided to people who require support to enable them to live in the community, such as sheltered accommodation for the elderly or the disabled. The Revenue Commissioners have published guidelines to assist local authorities in identifying such accommodation. All local authority residential properties which are liable to LPT will be in the lowest valuation band for the initial valuation period (2013 to 2016). Nothing in the LPT legislation prevents a local authority from recouping all or part of the LPT from its tenants through rent increases or levies. This decision is a matter for individual local authorities.

I am advised by my colleague, the Minister for Environment, Community and Local Government, that under the current statutory basis for the charging of rent by local authorities for their dwellings, section 58 of the Housing Act 1966, housing authorities are responsible for determining the rents of their dwellings, subject to complying with broad principles laid down by his Department, notably that the rent payable should be related to income and that low-income households should pay a lower proportion of income in rent. This current statutory basis does not provide for a specific levy or charge in respect of works or services provided otherwise than under the Housing Acts 1966 to 2013. However, the enactment does not prevent the amount of rent from being set at a level that will generate funds that could be used by a local authority to pay LPT in respect of a dwelling.

I am further advised by the Minister for the Environment that the current arrangements for determining local authority rents will be substantially replaced on the coming into force of section 31 of the Housing (Miscellaneous Provisions) Act 2009, which predates and does not refer to the LPT legislation. Following the enactment of the Housing (Amendment) Act 2013 in July, regulations are being finalised under section 31 of the 2009 Act re-affirming the principle that rents should be related to household income and composition, and reflecting the requirement that housing authorities should set rent levels that take account, as far as practicable, of the cost of providing works and services to, and managing and maintaining, their rented accommodation.