Finally some movement for home owners to access exemption to property tax for Homes damaged by Pyrite. More to follow at the end of November…
DÁIL QUESTION addressed to the Minister for Finance (Deputy Michael Noonan)
by Deputy Clare Daly
for ORAL ANSWER on 18/11/2015
To ask the Minister for Finance if the Revenue Commissioners have agreed to the change in Local Property Tax procedures, on an administrative basis, for homeowners with properties affected by pyrite, as announced by him on Budget 2016 Day; when these changes will come into effect; and when these changes will pub on a legislative basis.
Deputy Clare Daly: The Minister announced in the Budget Statement with great fanfare that he was finally going to address the difficulties of the owners of properties with pyrite in accessing their legitimate right to an exemption from the local property tax. This has been consistently sought for almost two years. What is the meat of the proposal and when is it likely to be introduced? Are there other details?
Deputy Michael Noonan: I thank the Deputy for raising this issue again. She has raised it on a number of occasions. I have moved to meet the concerns she has expressed on behalf of the householders involved. I announced on budget day that I was accepting the recommendations made by Dr. Thornhill in his review of the local property tax with respect to those properties which had been damaged to a significant extent by pyrite.
Revenue has agreed to my request that the change in procedures be implemented on an administrative basis pending the enactment of the necessary legislation.
Dr. Thornhill recommended the continuation of the exemption from local property tax for properties with significant pyrite damage, for the most part in line with the current arrangements. The exemption will continue to be restricted to those properties that have been certified as having a damage rating of “2” or “1 with progression”. The damage must be proved by inspection and testing by a competent person, such as an engineer, in accordance with a standard published by the National Standards Authority of Ireland. He also stated that where property owners elect not to incur the costs of testing, they have the option of submitting a self-assessed value to the Revenue Commissioners for the property which in their view reflects its current market value, taking account of the possible presence of pyrite.
Dr. Thornhill also recommended that the requirement for the certification of pyrite damage by a competent person be relaxed in certain limited circumstances. The first circumstance is where the Pyrite Remediation Board has agreed to remediate a property without carrying out the usual laboratory testing that definitively establishes the presence of pyrite. Where this happens, the Revenue Commissioners will accept confirmation from the Pyrite Remediation Board that it has accepted a particular property into its remediation scheme in lieu of certification by a competent person. The second circumstance is where a relevant party such as a guarantee company, an insurance company or a builder or developer accepts responsibility for the remediation of a damaged property or agrees to fully compensates the property owner in lieu of remediation. Where this happens, the Revenue Commissioners will accept documentary evidence that the relevant party has given an appropriate commitment to remediate the property or to fund the necessary remediation works.
Additional information not given on the floor of the House
I am advised that the Revenue Commissioners are currently preparing guidelines for the purpose of implementing Dr. Thornhill’s recommendations on an administrative basis and that these will be published by the end of November. Work on the necessary legislative amendments to give statutory effect to the changes is underway and I hope to introduce them to the Oireachtas in the near future.
Deputy Clare Daly: If any homeowner was listening in, far from thinking the process has become simpler, their head would be splitting after listening to the Minister. The reality is that many of these people have had hundreds of euro and more than €1,000 in some instances deducted from their wages for properties that are simply valueless. Based on the Minister’s response, I am not clear whether we must wait for legislation for this new arrangement to come in. When will this legislation be tabled? Is the exemption still restricted to three years because I do not think that is good enough given that the property continues to be essentially valueless and incapable of being sold, extended or improved in any way? The suggestions made by Dr. Thornhill may be a slight relaxation but they do not go far enough and it is regrettable that the Dáil has not been given an opportunity in any form to discuss those issues prior to any legislative change. Is that envisaged and when will we see legislation if that is what it depends on?
Deputy Michael Noonan: As I said in my reply, the Revenue Commissioners have agreed to my request that the changes in procedures be implemented on an administrative basis pending the enactment of the necessary legislation. I am also advised that the Revenue Commissioners are preparing guidelines for implementing Dr. Thornhill’s recommendations on an administrative basis and that these will be published by the end of November. On the issue of legislation, the Dáil runs until the middle of December and is scheduled to return after Christmas so the intention is to legislate.
Deputy Clare Daly: I take it that in the worst case scenario for a homeowner where no ground testing has been carried out, the homeowner can assess the value of the property. Presumably, if it is incapable of being sold because it has pyrite, it will return a very minor value and, therefore, be open to a very small property tax and the Revenue Commissioners will agree to that. Will the duration of the exemption be altered in any way by the suggestions made by Dr. Thornhill?
Deputy Michael Noonan: As I understand it from the Deputy and others who raised it, the nub of the problem was that the exemption could only be triggered by a test which sometimes cost an enormous amount of money that was well in excess of any relief that would be provided. This is being removed. The Revenue Commissioners are prepared to take evidence that is below testing. I have outlined the different types of evidence they will take but they will take self-assessment as well, which is probably the simplest. We will be clearer when they incorporate what I gave in my answer into the guidelines they intend publishing in the next two weeks. After that, the intention is to enshrine this in law but it will operate before the legislation is implemented on an administrative basis and I have the agreement of the Revenue Commissioners in this regard. There is no proposal to extend the period but we can look at that when the legislation arrives.