Low-income households with mortgages will have measures extended to defer property tax payments, under proposals set to go to Cabinet.
Finance Minister Paschal Donohoe will ask colleagues to approve the extension of mortgage interest deferral relief for local property tax (LPT) liabilities. This will benefit close to 2,000 households.
Theunderstands this relief will only be extended for one year more as the Finance Minister, Revenue, and the Taoiseach among others are examining an overall review of the LPT for all households.
This follows rises in property values and concern about subsequent LPT rates to apply once a freeze on increases ends next year. Mr Donohoe has said he wants LPT bills to remain roughly the same.
Cabinet will be told this week that, as next year’s property tax payments fall due in November, reliefs need to be extended in legislation this month.
A number of reliefs are available for LPT liabilities, including income threshold, for representatives of a deceased person, for personal insolvency, and for hardship reasons.
Income thresholds for LPT reliefs can be increased by thousands of euro. Thresholds for qualifying for relief can be increased by amounts equivalent to 80% of mortgage interest paid by the liable person.
A single person’s income must be below €15,000 for a full deferral. Partial deferral is allowed if income is below €25,000. These rise for couples. The thresholds are also increased by adding the figure equivalent to 80% of the mortgage interest relief, thereby potentially raising it by several thousand euro.
Cabinet will be told there are almost 2,000 deferral claims this year but that this could rise. The move is expected to cost less than €1m. The Government has yet to agree changes to new LPT rates. The freeze on rates ends next year, when households must again assess the values of properties. With huge rises in house values, the fear is that there would be big increases in LPT bills.
The Cabinet is tomorrow also expected to agree to increases in judges’ pay, in line with agreements to restore public sector rates and unravel Fempi measures introduced in the recession.
Restoration of judges’ pay must be agreed separately. Salary scales have already been adjusted twice in the last year, when pay restoration was applied for those earning over €110,000, including judges. Under this third round of restoration, new levels for judges appointed before 2012 will see the chief justice paid €247,443, High Court president €229,896 and a Supreme Court judge €215,860.