City and county face possible property tax hike in 2015

Homeowners across Galway city and county could be facing up to a 15 per cent hike in their property tax bills from January 2015, despite widespread public assumption the rates will remain unchanged for three years.

Fianna Fáil city councillor Peter Keane is warning that the Government is allowing local authorities to impose a 15 per cent increase from the start of 2015.

According to Cllr Keane, this will result in families with a home worth €200,000 seeing their tax rise from €405 to €466, while those in homes valued between €250,000 and €300,000 face a hike from €495 to €569.

However the Galway City Council has moved to clarify Cllr Keane’s statements, saying there are no plans to introduce any variations to the current rates. Fine Gael Galway West TD Brian Walsh said any decision on the matter will be in the power of councillors, and not the Government.

Under the property tax legislation, local authorities are allowed to increase the rate of tax on homes from January 2015. There was a widespread public assumption the rates currently being charged would remain fixed until 2016, however this only applies to the valuations, not the rates.

“The Government clearly attempted to pull the wool over everyone’s eyes,” said Cllr Keane. “Most people understood the tax would be fixed for at least three years. It’s now been confirmed this is not the case.”

Cllr Keane described it as a “deeply cynical” move. “Fine Gael and Labour will wait until just after the local elections before opening the doors for a tax increase on homes,” he said.

Although this will come as unwelcome news already cash strapped households across the city and county, City Hall has pointed out “there are no plans at the moment” to introduce any such charges.

“It may not occur in Galway as the city has the highest uptake of property tax payments,” said a spokesperson for the Galway City Council. “We also have other forms of income such as business rates and commercial rates, so property tax increase may not be needed.”

Furthermore, the spokesperson said the legislation permits decreasing the rates as well as increasing them.

“The legislation enables the rate to be increased or decreased from 2015. Also it will not automatically be a 15 per cent hike. The legislation provides for up to 15 per cent, so it can be anything between the current charge of 1.8 per cent and 15.”

Although city manager Joe O’Neill did say in relation to the provision for an increase, that “anything which gives the council more control over its own revenue is to be welcomed”; the final say on the matter will be with the city and county councillors.

Like the setting of the commercial rates, the changing of the rate of the property tax valuations is a reserved function of the elected members - meaning councillors must vote on it in order for it to pass.

“It will be a matter for councillors to decide and they cannot be dictated to or directed by the Government on this,” Fine Gael’s Brian Walsh told the Galway Advertiser. “It will have to come before councillors first and they will then make their decision.”

He also emphasised that the property tax rate can be decreased as well as increased.

“If and when something like this comes up,” he said, “councillors will take into account the rates coming in from commercial properties and other sources. When I was on the council we froze the rates for a couple of years. This will be up to councillors to decide, not the Government.”

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