Giving local authorities sole discretion to set the property tax after 2019 will result in a hike in the tax, but conversely, will also "result in less funding" being provided from central coffers to fund local services.
This is the view of Independent county councillor Jim Cuddy, who was commenting on the scheduled re-evaluation of property values for property tax in 2019, which he has called "a cop out for the Government".
At present, local authorities have discretion to increase or decrease rates by 15 per cent, but this has to be approved by the Housing Minister. However ,the current property tax rates were based on house values in 2013. Since then, house prices have risen substantially. As a result, Cllr Cuddy says the property tax is set to rise significantly.
Despite this rise, Cllr Cuddy says this will not necessarily result in an increased amount of money for local authorities to be able to fund services. The Oranmore based politician alleges that the Government wants "to hand all responsibility" over to local authorities, and then "further reduce funding" from central Government, so responsibility for funding local services will be "the sole responsibility" of local councillors.
The Government would still receive 20 per cent of property tax raised in each county under the new plan, but Cllr Cuddy fears this will lead to a situation where, if a local authority does not increase rates, they will "not get necessary funding".
"If this situation arises," he said, "then heavily populated counties will have a bigger increase in revenues from more modest increases in property tax and once again larger and less populated counties will be struggling."