Call for partial property tax exemption in managed estates rejected

The Government has rejected a call for homeowners who pay management fees to get an exemption on their property tax.

Fianna Fáil public expenditure and reform spokesman Seán Fleming suggested the waiver but stressed he was talking about a “partial” exemption for people who were currently paying on the double. He estimated the measure would cost some €17 million.

Minister of State for Finance Simon Harris rejected the proposal. He said a considerable number of landlords were likely to benefit and these people already deducted management fees from their tax liabilities.

Mr Harris added that property tax re-evaluations would be postponed from 2017 to 2019, which would be a benefit to homeowners.

Mr Fleming said those who would benefit were householders paying management companies to carry out work normally managed by the local authorities if an estate is fully taken in charge.

“Such people are paying on the double for access to roads, footpaths, lighting and other public services in the immediate area,” he said.

He said the relief should be the equivalent of one third of the management fee or of the local property tax or €100, whichever amount was lowest.

Introducing the Management Fees (Local Property Tax) Relief Bill, Mr Fleming said nobody would ever gain more than €300.

“People who are in properties valued at €1 million with big management fees attached - some developments charge up to €2,000 - and whose local property tax is very high would not get an extra benefit because it is restricted to a maximum benefit of €300.”

The estimated saving would be about €86 per person with an estimated 200,000 homeowners benefitting.

“We estimate the measure would cost approximately €17 million in a full year,” he said. “Some people would save a little less if their property tax was lower, and others would save substantially more but nobody would have a saving greater than €300.”

Mr Harris asked who would pick up the slack for the €17 million and he asked who would have to pay more and what services would have to be cut.

He said that following discussion with the Revenue Commissioners “we are not sure from where the 200,000 home owner figure is derived, as it does not appear in the 2011 census”.

He said the Revenue Commissioners “have indicated that without some figure on the numbers of properties subject to management fees and their average charges, it is not possible to cast the Bill’s provisions, as there is no basis in the returns made to the Revenue Commissioners on which to make an estimate”

Mr Fleming said he was introducing the Bill on behalf of party colleague Senator Darragh O’Brien because it was a money Bill and therefore could not be introduced in the Seanad.