Government to Introduce the graduated property tax early

Following hot on the heals of the December 7th budget, the government (small g) has decided to bring forward plans for a graduated property tax to be introduced in 2013, a year earlier then the EU/IMF bailout decreed.
Its likely to be based upon your house value, and it could mean that the €100 property tax in 2012 could grow by 30 times that amount for certain householders:

According to the Irish Times:

Under the commission’s proposed scheme a charge of €188 would be paid on houses valued at up to €150,000; €563 on houses between €150,000 and €300,000; €938 on houses up to €450,000; €1,313 on houses valued at up to €600,000; €1,699 on houses up to €750,000; €2,188 on houses valued at up to €1 million; €3,125 on houses up to €1.5 million and 0.25 per cent of the valuation on houses over that.

FS

Michael Noonan to outline three years of cuts in October

The Sunday Business Post is reporting that the minister for finance will outline the next three years of budget cuts and tax increases this October as part of a pre budget 'assessment'.

While it will be unpalatable to listen to no doubt, it will be a positive for tax payers and the markets alike as it will give people some measure of certainty going forward. Consumer confidence has been hit hard over the last 4 years with people being afraid to spend as they didn't know what burdens the next budget might hoist on them. We are well used to ministers refusing to answer what future budgets might hold, simply saying that 'all shall be revealed' on budget day. This policy of silence was an insult to tax payers and basic principles of democracy.

While we never want to take a reduction to our income, if we at least know what we are facing, we can cut our cloth accordingly. Hopefully the policy of 'Glasnost' will feed through to all aspects of our governance.

FS

Household charge set at €100

Minister for the Environment Phil Hogan has announced a new temporary “household charge” of €100 per year.
The new tax, viewed as a forerunner to a property tax and a water charge, will be levied on the estimated 1.8 million householders in the State, potentially raising €160 million in revenue in 2012.
Commercial properties and social housing as well as charity-run and sheltered homes are among properties exempt from the tariff. Younger people struggling to make home loan repayments, who qualify under the mortgage interest supplement scheme, can also qualify for a waiver.
The charge, which was agreed by Cabinet this morning, will be introduced in January next year, with householders given three months to pay up. Late payment penalties have been set at €10 a month.
Mr Hogan said he understood people are already suffering levies, charges and interest rate hikes, but he insisted he had no other option. “I’d prefer not to be introducing any charges but I’m obliged because we have ceded our economic sovereignty as part of the EU/IMF agreement, to bring in a property tax,” he said.
Admitting the tax could be fairer, he said it was a temporary two-year measure ahead of a property tax based on a value in 2014, which would be a “much fairer system”.
At a briefing in Government Buildings, the Minister said the new levy was an interim measure ahead of a full property tax, based on a property valuation system, and was separate from planned water charges. The water tax is to be introduced in 2014.
http://www.irishtimes.com/newspaper/breaking/2011/0726/breaking19.html

Noonan indicates 'difficult' cuts in budget may touch €4bn

http://www.irishtimes.com/newspaper/frontpage/2011/0705/1224300091222.html

FS

2nd Home Tax for 2011 due now!

Just a reminder to anyone with a rental property or holiday home in Ireland that to avoid penalties, you should pay the annual second home tax (€200) online before June 30th.

Further details from https://www.nppr.ie/

All the proceeds from this tax goes to the county council in the area where the property is. Its not clear if people currently liable for the NPPR tax will also have to pay the local area charge that's being introduced in Budget 2012 (as both go directly to the local council) but chances are that you will be charged both.

FS

Possible Income Tax hike in Budget 2012?

In another election pledge U turn, Finance Minister Michael Noonan today refused to rule out a rise in Income tax in December's budget. It is to give effect to the pension fund levy and VAT cuts announced in the jobs initiative.

But in the Dail, Minister Noonan appeared to suggest he cannot guarantee no tax hikes in the budget.

Mr Noonan said: "I am not going to rule out any tax initiative, or any tax increase or any tax reduction."

FS

Property & Water charges in 2012

It is now almost certain that flat rate property and water charges will be implemented in Budget 2012.

The water tax (or 'utility charge' as minister Phil Hogan is calling it) will be flat at somewhere between €150 and €200 per household. The revenue arising from this will be used to install water meters countrywide so in future the charge will be levied on a pay per use basis with some threshold of free water for each household.

Property tax will also be flat at around €100, irrespective of weather your house is a mansion or a maisonette. This will be replaced in due course with a property specific 'site value tax'.

Taxing people on a flat rate basis is regressive so why do it like this? Well both of these measures are outlined as necessities in the IMF/EU bailout, this is simply the cheapest and fastest way for the government to introduce them.

The always excellent Professor Morgan Kelly give an insight into the bailout in today's Irish times, http://www.irishtimes.com/newspaper/opinion/2011/0507/1224296372123.html .