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SOUTH DUBLIN COUNTY COUNCIL

MEETING OF SOUTH DUBLIN COUNTY COUNCIL

Monday, July 14, 2014

QUESTION NO.20

QUESTION: Councillor P. Gogarty

To ask the Chief Executive what communications, if any, have been received from Government in relation to discretionary powers of a local authority to vary the Local Property Tax upwards or downwards by 15%; whether there have been any indications or guarantees given that maintaining the charge as set out will guarantee SDCC more overall funding than the amount raised with a discretionary 15% LPT reducation applied; or whether or increasing it will actually result in a proportionate amount of funding being diverted out of the Council's finances through other reductions; if he will undertake to urgently seek such information if it has not already been provided given that this may influence the decision made by some of the elected members in terms of the rate set; and if he will make a statement on the matter?

REPLY:

The following legislation and guidance has been provided by Government and the Minister for Finance and the Minister for the Environment, Community and Local Government in relation to discretionary powers provided, in the Finance (Local Property Tax) Act 2012 and amended by the Finance (Local Property Tax) (Amendment) Act 2013, to a local authority to vary the Local Property Tax upwards or downwards by 15%: 

Legislation/Guidance	Reference to Power of Variation
Finance (Local Property Tax) Act 2012	Section 19: Local Adjustment Factor, Section 20: Power of elected members of local authority to vary basic rates Section 21: Notification of local adjustment factor to the Revenue Commissioners
Finance (Local Property Tax) Act 2012 (Specified Date) Order 2012 (S.I. No. 589 of 2012)	Section 3: provides that 1 July 2014 is appointed as the day on which sections 19, 20 & 21 of the Finance (local Property Tax) Act come into operation (decisions are effective from 2015).
Finance (Local Property Tax) (amendment) Act 2013	none
Finance (Local Property Tax) Regulations 2013 (S.I. 91 of 2013)	None (the SI prescribes the unfinished housing estates to which Section 10 of the Finance (Local Property Tax) Act 2012 relates)…n/a to SDCC
Circular Planning Section/Local Government Section PS/LGFPT 2/2013	None Explanatory circular relating to Finance (Local Property Tax) regulations 2013 (SI 91 of 2013)
Local Property Tax (Local Adjustment Factor)Regulations 2014 (S.I. No. 296 of 2014)	Part 1 - 5 Schedule 1 -4
Circular Fin 08/2014 - Guidance associated with Local Property Tax (Local Adjustment Factor) Regulations 2014	The circular was issued in conjunction with S.I. 296 of 2014 (Local Property Tax (Local Adjustment Factor) Regulations 2014) and provides guidance to local authorities in relation to the decision making process affecting the basic rate of the Local Property Tax

The Minister for the Environment, Community and Local Government has not yet indicated the funding allocations for 2015 but the following reply was recently provided by the Department of Environment, Community and Local Government in response to members questions about 2015:

"The Government has indicated an intention to move to 80% retention of all Local Property Tax (LPT) receipts within the local authority area where the tax is raised.

In 2015, local authorities will be required to implement changes to their budget process arising from EU obligations, which will require them to prepare draft budget strategies by the end of September 2014 and they will have the power to vary Local Property Tax basic rates by up to 15%, again by the end of September 2014. Together with recent changes to the water services funding model in the State, these are significant changes to the overall local government funding model and it is essential that the impacts are fully assessed and that the effect on overall Exchequer funding is managed appropriately.  Decisions in relation to funding for 2015 have yet to be taken.

The Department of Environment, Community and Local Government will continue to work with local authorities to ensure that they have an appropriate level of information, including in relation to LPT retention, to facilitate their budget process for 2015."

The Chief Executive is in regular contact with the Department for the Environment, Community and Local Government  seeking an early indication of the 2015 funding for South Dublin County Council and the financial implications for the council if any, of a decision by the members to vary the basic rate of property tax for 2015.  Decisions about future funding and any financial implications arising from a decision to vary the basic rate of property tax will be advised to the members as soon as they are received.