Almost 240,000 Dublin homeowners will see no increase in Local Property Tax next year after Dublin city councillors voted to apply the maximum discount of 15 per cent to the rate charged.

Despite a recommendation by council chief executive Owen Keegan that the full charge be levied on homeowners, councillors voted – by 40 to eight – to cut the rate.

Councillors last year voted to cut the rate of property tax charged to homeowners by 15 per cent – the maximum discount permissible. Mr Keegan had urged councillors to increase the amount in order to generate almost €12 million extra for council services in 2017. Dublin city homeowners, the State’s biggest payers of property tax, paid €50 million in the charge for 2016 up to the end of June, with just over 92 per cent of liable households having paid their bill so far.

Anti-Dublin tax

Twenty per cent of the tax paid by Dubliners goes to fund poorer counties. Fianna Fáil’s

Tom Brabazon

told a city concil meeting it was an anti-Dublin tax while Fine Gael’s Paddy McCartan said increasing the tax would be to “penalise Dubliners to subsidise parks and libraries in other counties”.

The amount of tax paid is based on the value of the property on May 1st, 2013. At the standard rate, a house then valued at €325,000 would have a property tax liability of €585. A house valued at €675,000 would have a charge of €1,215.

However, councillors in each local authority area have the power to decide to increase or decrease the rate charged in their area by up to 15 per cent each year.

Their decision holds for one year only and if no notice of change is given to Revenue by September 30th, the charge reverts to the standard rate. With the full 15 per cent cut, a homeowner who would have had a basic or standard charge of €585 will pay €497.25, while those who would have been liable to pay €1,215, will only be charged €1,032.75.

Mr Keegan had asked councillors not to vary the standard rate, and not to give the 15 per cent discount they applied last year. However, if councillors felt applying the full rate was unacceptable, Mr Keegan asked that they consider a smaller cut of 7.5 per cent – half the discount permissible, which would see the council take in €5.96 million extra, but would see homeowners’ bills increase next year.

Labour councillors supported the 7.5 per cent cut.