Dublin City Council chief executive Owen Keegan has urged councillors not to cut the rate of Local Property Tax (LPT) paid by the city's homeowners next year to avoid a €12 million loss in revenues.
However, a public consultation process on the tax rate found more than three-quarters of people want councillors to implement the maximum discount on property tax bills.
City councillors will on Monday decide how much property tax to charge householders next year. The three other Dublin local authorities have already determined the 2020 LPT rates.
Earlier this month, Dún Laoghaire-Rathdown County Council and South Dublin County Council voted to apply the maximum discount of 15 per cent to the rate charged for the coming year, while Fingal County Council voted to apply a 10 per cent discount, the same rate as it applied last year .
Councillors have the power to increase or reduce 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.
Since 2014 city councillors have voted to apply the maximum reduction, but in a report to councillors Mr Keegan has urged them to reverse their stance this Monday due to pressure on the city’s finances.
Revenue squeeze
Insurance costs, including rising premium payments and the cost of historic claims of €46 million “represents a real challenge to the city council”, said Mr Keegan.
Government proposals to change the way properties owned by Irish Water are valued for rates purposes would also hit council revenues, he added.
“Dublin City Council will potentially have €8.9 million less in Irish Water rates income in 2020 and have probably €8.9 million less from 2021 onwards, in perpetuity,” he said.
The council is also facing increased management fees for social housing in private developments, increases in spending on Dublin Fire Brigade, loan financing costs and increased pension costs.
“I recommend that the elected members apply the national basic rate, ie do not apply a reduction, thereby providing an estimated €12 million in additional funds,” said Mr Keegan.
While at the standard tax rate, homeowners would owe the council an average of €405 each, with the 15 per cent discount, the average annual charge is €344.25. Of the 1,600 people who took part in the public consultation process – 85 per cent of whom were Dublin homeowners – the vast majority (77.5 per cent) wanted the 15 per cent discount to be retained.
Of the 22.5 per cent who wanted the rate changed, just under half would like to see a lesser discount, while just over half wanted the charge increased above the standard rate.
