Bid to replace property tax rejected by party

A bid to abolish the property tax and replace it with a site valuation charge once back in power has been rejected by Fianna Fáil.

Delegates voted down the move to replace the levy amid fears it would hamper future programme for government negotiations.

The party’s finance spokesman Michael McGrath urged grassroots members to vote against the proposal as it would “tie our hands” in such post-election talks.

Mr McGrath said the party was opposed to a property tax at this time, and did not want to commit itself to a particular form of one some three years out from a general election.

A “raft of home repossessions” would be coming down the track because of the Government’s attitude towards mortgage arrears, Mr McGrath warned.

He said Government plans to close a legal loophole that has put a brake on the banks’ ability to take over debt-ridden homes was the wrong way to go.

Mr McGrath insisted the issue must now be treated as a “national emergency” as the “massive overhang of debt” was dragging down the economy as a whole and slowing recovery.

“The Government’s solution is to give more and more power to the banks,” he said. “They have shifted the balance of power firmly against the borrower and in favour of the banks.

“They have given the banks a veto on any deals under the new Insolvency Service. This week, the Government will bring to the Dáil a bill that will pave the way for a raft of house repossessions.

“In our view the banks should not be given any more power until they demonstrate a willingness and a capacity to deal with this issue in a compassionate and fair way.”

In a debate section of the ard fheis, mortgage expert Karl Deeter expressed concern that the Government had not deployed the same level of urgency in the mortgage area that it had done in others.

Mr Deeter noted that one in two homes has a mortgage and, of those, one in four is now in distress.

Mr McGrath said the best way forward was to give mortgage resolution officers the power to make binding decisions on how to resolve a borrower’s mortgage debt problem.

He branded the property tax, due in July, as unfair because families on incomes of less than €500 a week were not eligible for a deferral of payments.

Mr McGrath said that Fianna Fáil accepted the mistakes it made in power, but must now hold the Government to account as well as support it when it did positive things, such as the winding-up of the former Anglo Irish Bank.