Dublin councillors voted yesterday on what level to set the local property tax at for the coming year.
The debate looked a lot like last year, and so did the outcome: a 15 percent reduction in the tax for Dublin homeowners.
That was not what Dublin City Council Chief Executive Owen Keegan had asked for. He had asked them to leave it untouched.
That would have meant an estimated local property tax yield of €77.5 million, of which €62 million would have gone to Dublin City Council. With the 15 percent reduction, the estimated yield is €65.9 million, of which €50.4 million will go to Dublin City Council.
That’s an estimated €11.6 million less for the council.
If councillors had kept the local property tax at the base rate rather than reducing it, they could have used that cash for services such as libraries, footpath improvements, measures for senior citizens, waste-bin improvements, and the dog-fouling blitz, Keegan’s report to councillors said.
The total count was 47 in favour of the decrease of 15 percent, 12 against, and one abstention. (Nobody raised any questions about whether property-owning councillors should vote, or whether that was a conflict of interest.)
Sinn Fein has the largest group of councillors on Dublin City Council. Explaining the party’s support for reducing the local property tax, Sinn Fein councillor Cathleen Carney Boud said the tax was introduced “with absolutely no regard to the people’s ability to pay” and should be abolished. “It’s a red-line issue for us along with the notorious water charges.”
She pointed to low-paid working families, pensioners and people who have fallen ill and so are reliant on benefits. “Just because they own their own home, does not mean that they can afford to be taxed further in this manner,” she said.
Labour Party councillors put forward a motion to reduce the tax by 7.5 percent with the aim that the estimated €5.8 million that would come from not reducing it by the full 15 percent, would be spent on a range of services such as disability grants and a refugee social-integration fund.
The Green Party put together a motion to take Keegan’s advice and stick with the base level.
“We can’t spend 51 out of 52 weeks a year adding to a list of things that we want to see happen in the areas that we represent and then spend one week of the year saying, ‘Let’s reduce taxes,'” Green Party councillor Ciaran Cuffe said.
“There is something wrong with this slightly mind-altering space that we find ourselves in which we think we can provide the services and lower taxes at the same time,” Cuffe said.
A Progressive Tax?
The debate often swung towards the question of whether the local property tax is a “progressive” tax – i.e. it takes more from those with more, and less from those with less – or not.
Those who were advocating cutting the tax by 15 percent generally argued that it was not, so cutting it would help lower-income Dubliners most. Those who advocated cutting it by less, or not at all, argued that it was progressive, and thus already fair to lower-income Dubliners.
“In no way is it a wealth tax. It doesn’t take into account a person’s ability to pay,” said John Lyons of People Before Profit, advocating a 15 percent cut, a view that echoed across most of the City Hall chamber.
Said Sinn Fein councillor Daithi Doolan: “No matter how you turn it inside out, upside down, it’s not progressive. Progressive taxes is when there is an ability to pay and it’s linked to your income. That, the world over, progressive taxes are based on your income. Not where you live and what house you live in.”
Labour and Green Party councillors disagreed.
“My definition of a progressive tax is when, in a working class part of Dublin, you pay 50, 60, or 70 euro, and if you’re in Denis O’Brien’s shoes, you pay several thousand euro on your primary residence,” said Cuffe of the Green Party.
It would be great to see fairer taxes, but councillors have to deal with the imperfect, said Cuffe.
“I simply can’t look my constituents in the eye and say, when they’re looking for senior citizen services, when they’re look for a playground in the park, when they’re looking for traffic cameras in a 30km zone, I can’t look at them in the eye and say I voted for a 15 percent cut,” he said.
Labour’s Andrew Montague said those who pay rent are paying more of their income on their housing than people who own their homes. A 7.5 percent reduction would mean €7 extra a year for people on the lowest level and €2,600 a year for a family who have just bought a €14 million mansion, he said.
“To me, that’s a very progressive tax. That can be put to very good use in this city,” said Montague.