Seán Haughey (Dublin Bay North, Fianna Fail)
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91. To ask the Minister for Finance if taxpayers who paid stamp duty when purchasing their second-hand houses can be given a credit against the local property tax; if this issue was considered previously; and if he will make a statement on the matter. [4961/23]

Michael McGrath (Cork South Central, Fianna Fail)
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The Local Property Tax (LPT) was introduced in 2013 to provide a stable and sustainable funding base for local authorities and is a significant base-broadening measure. LPT has yielded over €4 billion for Local Authorities since its introduction. From its inception the LPT has been underpinned by the principle that keeping the number of exemptions low helps to keep the tax rate low for those who are liable to pay it.

The issue of reliefs including payment of stamp duty as a basis for relief was considered in the work the 2012 Thornhill Group, on which the design of the LPT was based. That report proposed a tax system that would contain limited exemptions and reliefs. The report cautioned that reliefs create costs which have to be paid for, either by taxpayers who do not benefit from the relief or by reductions in public expenditure. The report recommended against providing reliefs in respect of stamp duty payments. The rationale was that such relief would not be targeted on need; that the tax structure was known to house purchasers at the time of purchase; that the selling price of the property may have been affected by the stamp duty paid and that the stamp duty revenues would have been spent on the provision of public services. The Government agreed with the recommendation of the Inter-Departmental Expert Group that a universal liability should apply to all owners of residential property with a limited number of exemptions, in order to keep the rate of the tax as low as possible.

The Finance (Local Property Tax) (Amendment) Act 2021 fulfils the Programme for Government commitment to bring forward legislation in relation to LPT on the basis of fairness and that most homeowners would face no increase in their LPT liability. The Act provides for a cut in the main rate of the tax and widening of the valuation bands to make the changes affordable. As these changes were implemented for the 2022 LPT year, this meant that the majority of homeowners saw either a decrease or no change in their LPT liability. Where increases arose, the majority were by a single band. 

A system of deferral arrangements is available in certain circumstances to assist individuals who may have difficulty paying the tax. A qualifying person may opt to defer, or partially defer, payment of the tax. The deferred tax remains as a charge on the property, and must be paid before a sale or transfer can be completed.

The Government is aware of the difficulties facing many individuals and families and for this reason a wide variety of methods for payment of the LPT are available from which liable persons can choose the method most suited to their individual circumstances. Property owners experiencing difficulties in meeting their LPT obligations can contact Revenue through MyAccount at www.revenue.ie or by calling the LPT helpline (01) 7383626.

For these reasons, I have no plans to introduce a credit along the lines suggested by the Deputy.