What will the Local Property Tax changes mean for you?

On 2 June 2021, Finance Minister Paschal Donohoe confirmed the details of the Local Property Tax (LPT) changes. Once the changes go into effect on 1 November, the government estimates that just over a third (36 percent) of property owners will see an increase on their bill, just over half (53 percent) will see no change at all, and 11 percent will see their tax payments reduced.

First off, what is the Local Property Tax? The Local Property Tax was introduced in 2013, and it is an annual charge on all residential properties in the State. Basically, if you own a residential property, you will have to pay this tax. The charges are currently based on self-assessed valuations carried out in 2013. The amount you pay is based on the valuation of your property, and there are 20 different LPT bands, with the lowest two having fixed rate charges of €90 and €225. The problem with these valuations is that property prices have surged since 2013, while the valuations of property for LPT purposes have not changed since 1 May 2013. …

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Property Taxes

According to the Nevin Economic Research Institute (NERI), property taxes should be raised drastically to diversify tax revenue sources and to address issues of rising wealth inequality. As the government prepares its 2020 budget for 2020, increasing property tax is considered.

The trade union affiliated think-tank proposed ideas that represent a major shift in the tax system and the Government has always manages to neglect changing property taxes because of the associated political unpopularity.

Currently, the Government collects much less property tax revenue than most other European Union countries. Revenue from property taxes equates to only 23.3% of gross domestic product (GDP), while the average tax revenue in the EU amounts to 38.9% of GDP. In comparison with the rest of the EU, Ireland is much more dependent on VAT and excise tax revenues. VAT and excise tax generally have a greater negative impact on the less well off than the impact on wealthy.

Property taxes are the most difficult for the extraordinarily wealthy to avoid according to NERI’s senior economist Tom McDonnell. He continued to denote that underlying assets …

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Vlog on the Irish Economy – Ronan Lyons & Karl Deeter

I met up with Ronan Lyons (economist with Daft.ie) to talk about the ideas of property tax in Ireland, how it might be a fairer way to tax people than stamp duty, or indeed the abscence of property tax [because it rewards/doesn’t tax holding certain assets]. The discussion spread to other ideas in taxation, and eventually we made some predictions (I can already say they are bound to be wrong!) and then we took to the streets and asked Joe Public about their thoughts on the economy and whether or not they had any hope for the future.

If you want to watch the full conversation you can check out the playlist on youtube.

Ronan writes a very interesting blog, you can check it out at http://www.ronanlyons.com what I personally like best about Ronan (other than his affable good nature) is the unique take he has on many topics on Irish Propert (a subject I am very fond of), by utilising the daft database he is …

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