Gilmore defends claim to cut property tax

Tánaiste Eamon Gilmore has denied accusations that his party’s plan to include a 15% cut in property tax in its local election manifesto was “auction politics” aimed at securing more votes.

He said property tax legislation allowed for local authorities to vary the tax by 15% and he expected there would be scope for reduction in large urban areas where property values are much higher than rural areas.

“I expect when local authorities come to draw up their annual budgets at the end of next year, where property values are high, where property taxes are high and where densities are high, they will be able to reduce the property tax by up to 15%,” he said.

From next year, councils will retain 80% of the tax and will have the power to reduce or increase it by 15%. Mr Gilmore said he expected those councils which are led by Labour after May’s election to pursue the policy.

The main beneficiaries of the promise will be homeowners in large urban areas, such as Dublin and Cork, who pay much higher property taxes than homes in rural areas.

A 15% reduction for a home worth €300,000 to €350,000 would see its annual tax decrease from €585 to around €497.

The promise would prove popular with the so- called coping classes in urban areas, who for example in south Dublin have seen annual house value rises of up to 15%, almost double the national average of 6%.

The cut would be far more deliverable with Fine Gael support and yesterday Transport Minister Leo Varadkar gave it a guarded welcome.

Mr Varadkar said he would support such a cut but it would have to be matched by a decrease in local authority spending.

“Yes, it is possible for them [local councillors] to vary the property tax by 15%, but there are consequences to those decisions and if you want to cut the property tax, then you need to commit to lower spending,” he told RTÉ’s The Week in Politics.

Meanwhile, Mr Gilmore denied that he, Taoiseach Enda Kenny and Communications Minister Pat Rabbitte agreed before last week’s cabinet meeting not to include the North- South power line in Judge Catherine McGuinness’s review.

“People are trying to turn what are pretty normal conversations in Government into an episode of Coronation Street,” he said, after party sources suggested Mr Rabbitte was “shafted” by the Taoiseach when he later said he wanted the review group to examine the North- South pylon scheme.

Mr Varadkar insisted the communications minister was not shafted, saying the Government could not ignore the 35,000 people who had made submissions on the pylon routes.

Mr Gilmore also said the Cabinet would consider whether a redress scheme should be established to deal with other abuse victims at state schools.