Householders across Galway city could see their property tax charge drop by as much as €40 to €50 if a motion coming before the Galway City Council on Monday is passed. However unanimous support for such a move is not guaranteed.
At Monday’s city council meeting Sinn Féin will propose that the controversial property tax be slashed by 15 per cent for householders across Galway city. Although SF expect most councillors to back the party’s motion, council officials are uneasy about the debate taking place, while Government councillors appear to have little stomach for reducing the tax rate.
City Hall has the authority to raise or lower the property tax rate by anything up to 15 per cent under the Finance (Local Property Tax ) Act 2012. Cutting the tax would see charges drop by between €14 to €51, depending upon the valuation band intoi which a house falls. However, increasing the rates could see householders having to fork out anything between €13 to €120 extra.
“We are in favour of abolishing the property tax altogether,” SF councillor Máiréad Farrell told the Galway Advertiser, “but the council can only reduce it by 15 per cent, so we want the rate reduced by that amount.”
Cllr Farrell is confident the majority of councillors will support the motion, as “during the local elections many candidates spoke about the effect austerity is having on the public and how people are being pushed to the wall”.
However the Galway Advertiser understands that council officials are not keen on the motion going ahead at this time and it has asked councillors to hold the debate over until the autumn. This is because City Hall has just announced a public consultation process about varying the property tax rate, with councillors expected make a final decision on the issue in September, once the public submissions have been examined.
In an information document to councillors, Edel McCormack, City Hall’s head of finance, wrote: “I would respectfully advise that any discussion may prejudice the public consultation process and a full debate will take place at a special meeting in September.”
Cllr Farrell argues the debate should go ahead as the public “has a right to know” where City Hall “stands on the issue” ahead of the closing date for submissions. “We need openness and transparency in the process,” she said.
Furthermore, full backing for the motion from other councillors is not assured. Labour councillor Niall McNelis, although supportive of a reduction of the rates, says that doing so could create as many problems as it solves.
“I have no problem reducing the rates but is it something we can afford to do? “ he said. “Cutting the rate could see the city council down by €30/40 per house which mean less money coming into the council, but that money is going to have to come from somewhere else. Does that mean City Hall will have to up rents? Increase fees in other areas?”
Cllr McNelis though acknowledges that the public needs to see money from the property tax being put to work in Galway, especially, as Cllr Farrell points out, there are concerns the tax is going less on local services and more towards bondholders.
“A total of €5.2 million was raised last year in Galway by the property tax but we didn’t see any of that money,” she says. “That says to me it went to the bondholders.”