Householders in Co Cork are facing a 5% increase in their Local Property Tax (LPT) next year after councillors voted to seek more money from the tax to prop up services which have suffered from government cutbacks in recent years.
Last year councillors decided to reduce the LPT by 5% across all bands, resulting in the council losing out on nearly €2m of income.
County Hall officials circulated a report to councillors outlining the potentially serious financial implications of retaining that position or cutting the tax further.
They said any decision would impact on the council’s annual budget and proposed that, even without taking the LPT into account, the local authority’s budget for 2017 would have a shortfall of €3m.
Declan Daly, the acting county manager, said there are increased costs for which the council must budget next year, which include the Landsdowne Road/Haddington Road pay agreements as well as pension increases.
He said discretionary spending would be hit further if there is another reduction in the LPT.
Mr Daly said the LPT had been used for a wide range of projects that had benefited the county, including upgrading entrances to towns, extensions on council houses, and creating a special arts programme.
Cllr Kevin Murphy (FG) said he and his colleagues wanted to bring in more money by increasing the rate by 5%.
“Every single cent that comes into the council from LPT goes out for the benefit of local communities to a major extent,” he said.
“If we don’t pass this amount we will be doing our constituents a disservice.”
Cllr Frank O’Flynn (FF) said the Government had cut grants to local authorities in recent years, resulting in a shortfall for councils. “We feel we should maintain the status quo,” he said.
Cllr Declan Hurley, for the Independents, said they would “hold their counsel dry until a vote was taken on it”, a stance which resulted in shouts of “cop-out” from the Fine Gael benches.
Cllr Des O’Grady (SF) proposed a 15% cut, especially as a large amount of the LPT goes directly to central government. “It’s not a fair tax. We would abolish it and get money from increasing tax on high earners,” he said.
Cllr Cathal Rasmussen (Lab) said the council has to provide services for the county going forward.
He said he would like to see a small cut, adding that he was totally against the proposal by Sinn Féin.
Mayor of County Cork Cllr Seamus McGrath ruled, following a vote, there should be no further discussion on the topic. He directed that proposals from Fine Gael, Fianna Fáil, and Sinn Féin should go to a formal vote.
The Sinn Féin proposal was defeated 43-7, Fianna Fáil’s proposal also failed, while Fine Gael’s call to increase the LPT was approved, with support from most Independents, by 40-10.
Mr O’Grady said he was “deeply saddened” that for the first time, councillors were not allowed to speak individually on the LPT issue.
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