392. Deputy Barry Ward asked the Minister for Finance further to Parliamentary Question No. 455 of 4 November 2025, his views on the whether the local property tax is equitable given that it is based on property value rather than income; if he is concerned that it is overburdensome on people that live in high value properties with comparatively low income; and if he will make a statement on the matter. [61760/25]

Local Property Tax (LPT) was legislated for in 2012 in the Finance (Local Property Tax) Act 2012. The design of LPT was considered by an interdepartmental group chaired by Dr. Don Thornhill. As part of their terms of reference, the group were asked to “consider the design of a property tax to replace the household charge and that is equitable and is informed by previous work and international experience.”

In considering the equity of a property tax, the report of the group noted that owners of more valuable properties would pay more under a market value-based tax. The report noted this was equitable to the extent that market value provides a measure of the value of a residential property to the owner, particularly in terms of its proximity to places of work and local amenities and facilities.

Furthermore, in 2019, an interdepartmental also conducted a review of LPT. Their report noted that when viewed as a capital tax, property tax can be considered progressive since capital tends to be more heavily concentrated in the hands of higher income earners. It also noted that taxes that are based on incomes tend to bring about behavioural change. In contrast, property taxes apply to a base that is largely immovable and broadens the tax base.

As outlined in my response to Parliamentary Question No. 455 of 4 November 2025, there are provisions in place to support those that have difficulty in meeting their LPT liabilities, including those who may live in a high value property with a comparatively low income.

Homeowners have the possibility of deferring the charge to LPT in certain circumstances. A qualifying person may opt to defer, or partially defer, payment of the tax. Where a person qualifies for a full deferral, 100% of the liability can be deferred. Where a person qualifies for partial deferral, then 50% of the liability can be deferred. The balance of 50% of the tax must be paid. The deferred tax remains as a charge on the property and must be paid before a sale or transfer can be completed. Interest is charged at 3% per annum on the deferred amount. Further information regarding the deferral of LPT is available on the Revenue website at: www.revenue.ie/en/property/local-property-tax/deferral-of-payment/index.aspx

For the LPT valuation period 2026-2030, the income threshold for a single person to qualify for a full deferral is €25,000, and for a partial deferral is €40,000. For a couple, the income threshold to qualify for a full deferral is €40,000, and for a partial deferral is €55,000.

It is also possible to apply for a deferral on the grounds of hardship where a person suffers an unexpected and unavoidable significant loss or expense, as a result of which a person cannot pay their LPT liability without suffering financial hardship.

Any property owners experiencing difficulties can avail of a wide range of flexible payment options both in respect of their LPT liabilities and for any previous years where liabilities remain outstanding. The full range of payment options, which includes phased arrangements, are available to property owners on the Revenue website at: www.revenue.ie/en/property/local-property-tax/paying-your-lpt/index.aspx.

For these reasons, it is my view that it is appropriate for LPT to be calculated on the basis of property value rather than income.