Explainer: What does the expected hike in Local Property Tax mean for Dublin?
Dublin city councillors are, for the first time, set to increase the rate of Local Property Tax (LPT) owed by homeowners in the capital, by not applying their regular 15pc reduction.
The issue will be voted on at a meeting scheduled for 6.15pm this evening. But what does that mean for homeowners and the city at large?
The largest local authority in the country, Dublin City Council (DCC), is today expected to increase the rate of LPT for homeowners, subject to a vote this evening by councillors.
This is because, for the first time since the LPT was introduced in 2013, they will have elected not to apply a 15pc discount to the baseline rate.
The council’s governing grouping, made up of Fine Gael, Fianna Fáil, Green Party and Labour councillors, say it’ll bring in an extra €16.4m of funds over the coming year for much-needed service improvements.
But Sinn Féin, People Before Profit and Independents say that not continuing the 15pc discount is unfair on families, pointing to the cost of living crisis.
So, how much will I be charged on my home?
If you live in the DCC area, your LPT bills will go up by 15pc from this measure alone.
However, on top of that, the government is also in the process of adjusting the bands and rates for the tax upwards, meaning even higher payments for households, particularly those with high-value homes.
The value of properties that fall into the 20 bands have increased by 20pc, as property values have grown since the last valuation in 2021, meaning 96pc of homes will stay in the same band as before.
But each band will also cost homeowners more, for example band 4 properties, which are set to be valued between €420,001 and €525,000 under the changes, will now pay LPT at a rate of €428-a-year, up from €405.
Just under 75pc of homes in the DCC area fall between bands 1 and 4, according to Revenue.
Band 10 homes, to be valued between €1,050,001 and €1,155,000, will be charged €998-a-year, up from €945.
Those in band 19, to be valued between €1,995,001 and €2,100,000, would see their contribution jump to €3,110 from €2,721.
Homes with a valuation of more than €2.1m will see an even larger increase, as any value above this cut-off point is charged the highest annual rate of 0.3pc of the property’s value.
Homes in band 1 (up to €240,000) will pay the lowest LPT, at a fixed rate of €95 annually, up from €90.
The combined effect of the rising DCC rate and national revaluation, means that LPT bills could increase by anything up to 34pc for homeowners in Dublin next year.
Sinn Féin, People Before Profit and many independents have been urging councillors to continue reducing the LPT rate, citing cost of living challenges for residents of the capital.
Daithí Doolan, Sinn Féin councillor, said not only is his party pushing for the maximum possible 15pc reduction, but they are seeking the abolishment of the tax altogether.
“It is not even a property tax,” he said. “It is a charge on people’s homes. Meanwhile, Dubliners are unfairly punished by the extremely high price of housing in the capital.”
Mr Doolan said Sinn Féin saw it as “unfair, regressive charge”, because it is not based on people’s incomes.
“The prince pays the same as the pauper,” he added.
Green Party councillor Janet Horner said the extra revenue will be spent on upgrading council housing. Photo: Mark Condren
The DCC governing parties are already gushing about how the extra €16.4m will be spent, with €5.4m of that ring-fenced for housing maintenance in council-owned complexes.
Green Party councillor Janet Horner said rejuvenating council housing is a top priority.
“People should not be living with single glazed windows, with mould and cold, damp conditions in our flat complexes,” she said. “This spending commitment marks a genuine commitment to addressing that injustice.”
Around €3m will be spent on additional road, footpath and carriageway maintenance, with another €3m devoted to a revolving fund which would target urban regeneration and vacant properties.
Repayment of borrowing for infrastructural projects will be allocated a further €2m, while DCC will get an additional discretionary spend of €1m from the fund.
A further €1m will be spent on new apprentices, with the same figure going towards additional zebra crossings.
What about the other Dublin councils?
Dublin City Council is set to be the only authority in the capital to apply the baseline rate of LPT to homeowners, with South Dublin County Council (SDCC), Fingal County Council and Dun Laoghaire-Rathdown (DLR) County Council all applying reductions to varying degrees.
Councillors in DLR recently voted to continue the 15pc reduction for homeowners there, costing the council around €10m in lost income.
SDCC has voted for a 7pc reduction in LPT this year, down from their previous 15pc discount level.
Fingal councillors also voted to continue reducing the rate, by 5pc, albeit down slightly from the 7.5pc previously.