The Irish Independent reports that homes with vastly
different market values have been bunched together in the new Revenue
Commissioners guidelines on the property tax, fuelling confusion over the
The online guide has been criticised for being too vague to help people, and
could result in some homeowners paying the wrong rate of tax.
And the Irish Independent has discovered a series of discrepancies which show
how homeowners face a much more difficult task than expected when valuing their
homes for the tax.
It means that owners may have to carry out – or pay for – detailed research
into what their homes are worth or run the risk of being fined up to €3,000 by
Revenue for underpaying.
This is because the Revenue Commissioners has banded together homes with
widely varying market values. In one town of more than 15,000 people, all
semi-detached homes agreed as being worth between €150,000 and €200,000,
regardless of the number of bedrooms or size of the garden.
However, sales data shows three houses with one, two and three bedrooms sold
for different prices last year.
This would result in annual tax bills ranging from €404 in a full year to
€224 – a difference of €180 a year.
Revenue has warned that homeowners must self-assess the tax, and will be
liable if the tax is underpaid.
Fianna Fail finance spokesman Michael McGrath said the guide could lead to
"more confusion", and could result in people overpaying.
"People were hoping it would give an accurate guide, and I am fearful that
some will rely on the prices given for their area but those guide prices could
result in them over or underpaying the tax due to the Revenue," Mr McGrath
"You would have to wonder how useful it is for people who are struggling to
come up with an accurate valuation.
"If Revenue published indicative prices for an area, and were willing to
accept valuations based on those, the entire initiative would be meaningful, but
issuing guidance and then saying it's up to taxpayers to come up with an
accurate valuation really undermines the entire process," Mr McGrath said.
"People can either rely on it or not. I think they can't, and if
the guidance is misleading the homeowner will pay the price."
Householders who underpay their tax face being hit with fines of up
to €3,000. If there is an overpayment, the excess will be refunded.
Some 1.66 million householders will be hit with the charge from
The Government expects to raise €500m in a full year, and expects
more than 80pc to register by the end of the year.
The tax is levied at 0.18pc of the value of the property, up to a
market value of €1m.
Expensive properties will be assessed at 0.18pc up to €1m, and
0.25pc on the portion of the value above €1m.
The Revenue Commissioners defended the online guide, saying it was
designed to be used by the homeowner to calculate their tax bill.
It also warned people to take into account any "exceptional"
features of their property – including large gardens or house extensions –
which could inflate its value. If it was in a poor state of repair, the
value could be reduced, which would lead to a lower tax bill.
People who relied on the guidance – which included consulting
Revenue's guide, the Property Price register and examining valuations –
would not have their bill challenged. Deliberate under-valuations would be
"Self-assessment requires you to honestly assess the value of your
property. If you follow Revenue's guidance honestly, your valuation will not
be challenged," a spokeswoman said.
"However, if you feel that the guidance is not indicating a
reasonable valuation for your property, you should make your own assessment.
Revenue will challenge cases where deliberate under-valuation occurred. You
are responsible for ensuring that you choose the correct value band for your
From next year, dubious claims will be probed, the spokeswoman
"We expect (the Local Property Tax compliance programme) will focus
on valuations which deviate significantly from the average value for the
relevant property type and geographic location."
Owners will be able to check property values in their area on
The valuations are based on a variety of sources, including the
recently established property price register, the An Post geodirectory and
stamp duty data. Other information, such as the 2011 Census results and
1,300 independent valuations carried out for the Revenue, were also used.
Payments must be made from July 1.
The Irish Independent also reports that the
Government is signing up the country's best business brains to independently
advise on the rollout of its jobs creation policies.
A group of six leading business people from domestic and multinational
companies will join the team tasked with ensuring the Action Plan for Jobs is
The group includes the Irish boss of a US tech company who has been critical
of the education system's failure to produce skilled workers.
The six business people will also sit on a revamped body that recommends ways
to improve the country's competitiveness.
The group includes Louise Phelan of Paypal, John Herlihy of Google and
Heather Reynolds of Eishtec, along with three others to be confirmed this week.
The appointments of the industry partners are expected to be confirmed this
week by Jobs Minister Richard Bruton.
The addition of the business people is intended to inject some private sector
experience into the plan but also to give an added push to ensure the targets
Aside from attending the meetings of the monitoring group, it is also
expected the group of six will get to brief the Cabinet committee on jobs.
The Irish Times reports that mortgage lenders will run the risk of financial sanctions if they
fail to meet Government targets in a new plan to overcome the personal debt
The plan, to be unveiled on Wednesday, includes last-resort
measures to facilitate the repossession of property from home owners deemed to
be in “strategic default” if they do not co-operate with their lenders.
This is designed to prompt borrowers who can repay their
loans but who won’t do so to engage with their banks. The aim is to separate
them on a case-by-case basis from borrowers who genuinely cannot repay, and to
settle such cases quickly.
Tone of remarks
The matter is politically sensitive. The tone of remarks on
Department of Finance secretary general
John Moran last week went down badly with some Cabinet members.
However, a senior Government source said there was a clear
understanding among all stakeholders that the arrears question should be
urgently addressed. The objective was to keep people in the family home “where
it’s at all possible”, the source said.
There is support for the initiative within the EU-IMF troika.
The view within the troika is that the task of settling genuine arrears cases
would be made much more difficult if strategic defaulters are not tackled.
Increased pressure on the banks to confront tens of thousands
of mortgage arrears comes in a week in which Revenue starts writing to 1.66
million home owners with estimates of their property tax liability. It will take
four weeks to complete the delivery of letters to all properties.
A new Revenue web page on the tax went online yesterday,
setting out valuation estimates on homes throughout the State. Valuations
scrutinised by The Irish Times were perceived to be at the conservative
end of the scale.
The new plan to confront the mortgage crisis aims to remove
an incentive for the banks to postpone the definitive settlement of arrears
cases, a practice known as “extend and pretend”.
Current rules enable banks to avoid taking a financial loss
on mortgages which are in default but which have yet to be formally
Under the new plan, the Financial Regulator will compel
lenders to recognise such losses up front if they do not meet targets to
restructure a set number of loans in arrears every three months. Banks would
have to set aside capital against such losses, weakening their financial
The objective is to encourage banks to put arrears customers
in a sustainable position for the long-term, moving away from interim measures
like forbearance on repayments or interest-only arrangements. The target number
of cases to be settled every three months by each institution will increase in
The prospect of further penalising unco-operative banks by
preventing them from reducing future corporate tax payments by offsetting
liabilities against past losses was discussed within the Government. Such
measures, however, are likely to be held in reserve this week.
The new regime will apply to the two State-supported pillar
Allied Irish Banks and
Bank of Ireland, and all other mortgage lenders active in the Irish market.
It is likely to include provisions to give the banks
increased scope to make contact with customers in arrears. High-level bankers
have been complaining in private that current rules allow only four “contacts”
The Irish Times also reports that
the Irish-owned Doyle Collection hotel group received $90 million from the sale
of its Back Bay hotel in Boston in mid-February, The Irish Times has learned.
US-based Loews Hotels & Resorts acquired the 225-room, four-star hotel in Boston
from the Doyle chain. The sale price was not disclosed at the time of the deal.
The hotel has been converted to a Loews Hotels brand and the New York- based
company has announced plans to spend $8 million renovating it.
The Doyle Collection put the Boston hotel on the market late last year through
estate agent CBRE after receiving unsolicited approaches.
It is understood there was keen interest in the property and the price achieved
was considered strong. The Back Bay is a leased hotel that has been operated by
the Doyle Collection since 2004.
The lease was acquired in 2002 by the former listed Jurys Doyle Hotel Group, a
predecessor to the Doyle Collection.
Jurys Doyle paid $20 million for the lease and invested $45 million in
redeveloping the former Boston police department’s headquarters.
The Doyle group is also selling two of its three hotels in Washington DC – the
Marriott Courtyard Hotel and the Normandy Hotel. It plans to retain ownership of
the Dupont Circle Hotel in the US capital.
The sale processes for these hotels are “progressing well” with “strong
interest” in both, a source close to the company said. The Doyle group is
expected to redeploy the proceeds of these sales to bolster its position in the
London market, where it already has three large four-star properties.
The company, controlled by the Doyle and Beatty families, must complete a
refinancing of its debt later this year.
Latest accounts for Doyle Hotels (Holdings) Ltd show that it has bank debt of
¤331.2 million, which falls due for settlement in November 2013. The company had
net cash of ¤27.9 million on its books at the end of 2010. The Doyle Collection
operates 10 properties in Ireland, the UK and the US. These include the
five-star Westbury in Dublin and the four-star Croke Park hotel.
The Irish Examiner reports that
members of the European parliament will play a pivotal role in the reform of the
EU’s Common Agriculture Policy when they debate and vote on the proposals
tomorrow and Wednesday.
Amendments, will fix the parliament’s mandate for the negotiations to follow
with the Council, represented by the Irish presidency and Agriculture Minister
Simon Coveney and his team.
However, the lobbying will continue up to the end, as the parliament’s
Agriculture and Rural Development Committee has voted down many of the reforms
devised by the European Commission, coming much closer to the position of some
of the member states instead.
This will be the first time that the European Parliament will have equal say to
the member states in agriculture, but some of the committee’s decisions are
splitting the MEPs and many decisions are expected to be very tight.
Environmentalists such as the World Wildlife Fund are critical of the MEPs’ move
against efforts to ensure that agriculture is more environmentally sensitive in
the future. and point out that one move that would result in double funding for
farmers is in fact illegal.
Rather than the new policy promoting greening or environmentally enhancing
policies, they will intensify funding of the same polluting farming, said WWF
director Tony Long.
“Many MEPs on the COMAGRI supported the reduction of greening measures, voted
for the illegal double funding measures, and the reduction of cross compliance
measure, want the continuation of a money for nothing ethos that rewards large
farmers regardless of the impact they have on nature,” said Mr Long. “Currently
20% of all recipients received 80% of all funding. This unjust distribution is
set to continue if the EU parliament votes through these measures.”
Independent MEP Marian Harkin has warned that, in the absence of any commitment
to pillar 2 funding, which is for rural development, the focus had to be on how
the Single Farm Payment would be distributed in the reform of CAP.
The terms “active” and “productive” farmer had yet to be defined, but a farmer
with 20 cows could be just as active and productive as one with 200 and needed a
fair allocation of the SFP, said Ms Harkin.
Mr Coveney has already said that there would not be a dramatic redistribution in
a short space of time, as had been originally proposed by the European
Commission, between big and small farmers.
Today, the chairs of the Agriculture and Fisheries Committees from the
parliaments of the EU member countries are due to meet in Dublin Castle to
engage with EU commissioners Dacian Ciolos and Maria Damanaki and with Mr
Coveney on the future of the CAP and common fisheries policies.
out our subscription service, Finfacts
at a low annual charge of €25 - - if
you are a regular user of Finfacts, 50 euro cent a week is hardly a huge ask to
support the service.