Local Property Tax: Councillors vote to maintain 15% increase for five years

Councillors in Donegal County Council have voted to retain the 15% increase in Local Property Tax (LPT) for the next five years. 

The vote followed a robust debate at Monday’s Plenary Meeting of Donegal County Council in Lifford.

Housing, swimming pools, theatre supports, roads, tourism marketing and borrowing capacity for capital projects would have been among areas affected if the council reverted to the former Local Property Tax baseline.

Director of Finance Richard Gibson told councillors that such a move would result in a loss of €1.4 million per year. This would have to be cut from other areas, and would reduce access to grants which require match funding as well as severely restricting borrowing capacity. 

Members heard that the difference between retaining the current rate and reverting to the baseline would work out at approximately 26c per week or €1 per month for households in the lowest tranche of LPT. But the impact of losing the €1.4 million would have a detrimental, long-term effect on communities across the county. 

Some councillors including Cllr Jimmy Kavanagh (FG) and Cllr Ciaran Brogan (FF) called for councillors to ‘do the right thing’ and vote to keep the higher rate of tax in order to maintain the current level of service.

Sinn Féin councillors called for the tax to be phased out, with Cllr Gerry McMonagle referencing the government’s Apple tax windfall of €13 billion.

Cllr Jimmy Brogan (Ind) said that for people struggling financially in his area of south Donegal, €1 per month was a lot. He added that services were lacking compared to areas such as Letterkenny, and he voiced his opposition to the tax.

This was voiced by a number of councillors, while others asked for more specific details on what exactly would be cut if maintaining the 15% increase was not approved.

Council management explained that exact details could not be given, as knowing how much property tax was expected would drive the council budget for the year ahead. However, it was explained that any discretionary spending was at risk, and the final say on what was to be cut would have to be voted on by councillors in their respective municipal districts.

Mr Gibson said: “€1.4m less in income means €1.4m less work done. It is as simple as that.”

The current income from LPT is €28 million, with €10.5 million gathered locally and €17.5 million from central government. 

Following much debate and discussion, three proposals were put forward. Cllr Micheál Cholm MacGiolla Easbuig proposed that the LPT baseline be reduced by 15%. This was seconded by fellow independent councillor, Cllr Jimmy Brogan. There were 17 votes against the proposal, 12 abstentions and two in favour. 

The next proposal was to retain the baseline. This was proposed by Cllr Michael McBride (Ind) and seconded by Cllr Declan Meehan (Ind).  The result was 17 votes against the proposal, 13 in favour,and two abstentations. 

The third proposal was that the 15% increase be retained for a further five years beginning in 2025. This was proposed by Cllr Jimmy Kavanagh (FG) and seconded by Cllr Patrick McGowan (FF). The proposal passed, with 17 votes in favour, 14 against and three abstentions.