Cabinet set to discuss property tax controversy

Opposition claim response by Government to row has lacked coherence and clarity

Local Property Tax forms. Photograph: Bryan O’Brien / THE IRISH TIMES

Local Property Tax forms. Photograph: Bryan O’Brien / THE IRISH TIMES

Mon, Nov 4, 2013, 17:34

The Government is likely to discuss the controversy over early payment demands from the Revenue Commissioners for the property tax at its weekly Cabinet meeting tomorrow.

It comes as Fianna Fáil said this morning it will be try to put forward an amendment to the property tax legislation in the Dáil this week that guarantees that no household is obliged to pay the tax until 2014.

Revenue has written to thousands of householders with instructions on how to pay the tax in respect of 2014. Those opting to pay by debit or credit card and some of those paying by cheque must pay before November 27th, this year. Those opting for other payment methods must say how they are going to pay before this date but have a March 2014 deadline to pay.

With no sign of the week-long row abating today, a senior Fine Gael Minister signalled that his party agrees with the Labour Party that the Revenue might best be advised to revisit the issue.

Minister for Justice Alan Shatter said he had no difficulty with the Revenue if “it wished to refine the approach in some shape or form” but added that it was a matter for Revenue itself. He also emphasised that it was quite clear that nobody was obliged to pay the tax before 2014.

“There are a range of different ways to ensure you do not pay before 2014,” said Mr Shatter this morning.

Mr Shatter’s comments were nuanced differently from those of Taoiseach Enda Kenny who said at the weekend that the Revenue was quite entitled to collect the tax in a manner in which it saw fit. He gave a strong indication that no change in approach or change of collection date was required.

That seemed to put the Fine Gael position at odds with that with Labour and of Tánaiste Eamon Gilmore. While both parties have accepted that the letters sent by Revenue to households could be confusing in some respects, Mr Gilmore said it was wrong for a 2014 tax to be collected in 2013, and asserted that Revenue needed to look at the matter again.

With a number of Ministers responding to the issue, no clear or consistent Government line is evident at present.

Minister for Children Frances Fitzgerald seemed to echo the Taosieach’s line today when she said it was important there was ongoing communications from Revenue.

“Everybody [SHOULD]be clear about those different options and that is what the critical issue is now.

“[THERE IS] no doubt thre will be ongoing communications from Revenue.

“There is a range of payment options for next year and not pressure at all to pay before the end of the year, but just to let Revenue know how you intend paying,” said Ms Fitzgerald.

The controversy has revolved around those who made lump sum payments by credit card or debit card, or by cheque, in 2013. The legislation has a liability date of November 1st with November 7th pencilled in as the deadline for filing the returns manually, or November 27th the date for filing online. Over half of all homeowners made the payment by either credit or debit card in 2013 but data protection requirements dictate that the Revenue must collect card payments immediately (ie in November) rather than retaining the card information to collect payments in the New Year.

Revenue has pointed out that there are alternative ways of paying that will ensure that no money is collected before 2014. Besides direct debit and salary deduction, households can authorise their bank to make a once-off single debit authority which will be collected on March 21st, 2014.

Fianna Fáil finance spokesman Michael McGrath and its public expenditure spokesman Sean Fleming have both said that the Government is at fault because it wrote the legislation that required November payments. Both said the Revenue was simply implementing and effecting that legislation.

Mr McGrath also indicated Fianna Fáil will seek to have the law amended this week.

“The Government opened the door to the problem by providing for a liability date of November 1st for effecting the following year’s charge. The Revenue had then to implement as required. They doing so in a manner that requires those with debit or credit card payments to [HAVE THEIR]money deducted immediately.

“There is a straightforward way of dealing with this which is not to allow the tax to be deducted until the calendar year to which it relates and Fianna Fáil will be bringing forward a very straightforward amendment along those lines,” he said.

Other opposition figures, inlcuding Sinn Féin leader Gerry Adams and Socialist Party TD Joe Higgins have also beein highly critical. It has been asserted the Government seems to be at sixes and sevens on this issue and its response has lacked coherenece.