The household tax… December 20, 2012Posted by WorldbyStorm in Uncategorized.
I’m intrigued by the news that Councils who ‘failed to meet their collection targets for the household charge’ – that is those with collection rates below 60 to 65 per cent – are having funding cuts imposed on them. Intrigued for a number of reasons, not least that Councils, as distinct entities have a fairly nebulous standing in most peoples thoughts. It’s not as if there’s any great identification with them, or even much notice taken of them. They’re a layer of service provision that is generally regarded as yet another arm of the state, and not discrete entities in themselves. Of course there are exceptions, but the point is that there’s no great attachment to them.
So it is unclear what mechanism the Minister of Environment expects to operate in terms of pressure being brought to bear either by the Council itself or presumably enraged household charge payers, and on who that pressure would be directed. Would it be the non-payers? But that’s absurd because they’re scattered hither and yon. On the Councils themselves to step up efforts to claw back the charge from non-payers?
It’s also an odd tactic because it doesn’t benefit those who have paid. Indeed arguably it does entirely the opposite.
There’s more as well. It’s an useful metric to see where the campaigns have been (at least in part) successful.
…the largest funding cut has been imposed on Donegal, with €309,000 withheld from the county’s local government fund (LGF) allocation for the final quarter of this year.
Laois, Louth, Meath, Offaly, South Dublin and Cork county councils also saw their funding cut, with cuts ranging from €45,000 in Louth to €167,000 in Cork. Councils which collected less than 60 per cent of the charge faced a cut of 1 per cent in their total LGF for the year, while those which collected between 60 and 65 per cent faced a cut of 0.5 per cent. Cork and South Dublin narrowly missed the 65 per cent target, while Laois, Louth and Meath collected between 60 and 65 per cent.
Householders in Dun Laoghaire-Rathdown were the most compliant in the country when it came to paying the new tax, with 85.1 per cent of them paid up by the end of November, the deadline for the LGF cuts to apply.
Nine further local authorities collected in excess of 70 per cent of the liable household charge – county councils in Mayo, Kerry, Clare, Wicklow, Sligo and North Tipperary, and city councils in Dublin, Galway and Waterford. Homeowners in Donegal were the least compliant in the country, with just 55.1 percent of all residential property owners paid up by the end of November.
Interesting to do something more in-depth than a back of the envelope calculation on median income levels in those parts various – no?
And the level of non-payment overall?
More than 31 per cent of all home-owners had still not registered to pay the €100 levy at the end of last month, according to Department of Environment data. Grants from the LGF were budgeted to provide 17 per cent, or €651 million, of the overall funding of local authorities this year.
Given that the CAHWT seems to have faded somewhat into the background, in part from the sheer pressure of other events that have crowded out the political agenda, what happens next?
Well, welcome to the property tax. The debate over the property tax is an interesting one. The property tax is – of course – not a proper property tax in that it is limited to one form of property, and nor is it genuinely proportional. The differentiation in terms of the percentages applied are quite minimal and hardly progressive in the technical sense of the term and the bands themselves seem intrinsically unfair if one is at either end of them.
How this operates in practice is of great interest and what the response will be. I’m probably not alone in thinking that a left campaign built around property and taxes is problematic from the off. But anyhow, we will see.
What is odd, though, is the feature built into the tax as regards deferrals.
As noted on Money Guide Ireland deferrals are available for those on low incomes and in particularly straitened circumstances, but what is genuinely strange is that interest of 4 per cent per annum will be charged on deferred amounts.
This seems almost gratuitous in that it builds up outstanding amounts across periods where people are in very very difficult circumstances. It would be interesting to hear an official rationale for same. But it seems to me to be of a piece with the cloth eared and clumsy introduction of the household charge. Which, it has to be said, doesn’t auger well for its smooth implementation over the next year or two.