Irish Chamber Supports Local Levy For New Houses

by Jason Gorringe, Tax-News.com, London

19 November 2003

Speaking in response to the decision to allow local authorities to impose a service levy on new houses, the Chief Executive of the Chambers of Commerce of Ireland (CCI) John Dunne expressed support for the move arguing it will ease the tax burden on businesses who bear the brunt of local taxation.

“At the moment, small and medium sized enterprises, which are struggling to survive, are being forced to fund the provision of services for new houses through rising commercial rates and, in many cases, these SMEs are not benefiting in any way from the development of more houses in their areas,” said Mr Dunne.

“Currently 1 euro of every 4 euros of local authority budgets comes from commercial rates which are paid on just 8% of properties because, over the years every other sector bar business has been excluded from the rates base. This is on top of the plethora of other local authority service charges the businesses have to pay,” observed Mr Dunne.

“These levies, while not an ideal solution, are the best on the table at the moment and mark a step in the right direction until the review of local government financing, promised by Minister Cullen, is undertaken,” argues the CCI chief.

“They also highlight the need for a wider property tax to be introduced to ensure that it is not just new home owners and the business sector that fund local authorities but that all sectors pay their fair share towards the infrastructural development of their localities. At the moment, the burden is falling on too few shoulders,” he said.

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