Property Tax rate may be set at 0.2% of home value

Thursday 29 November 2012 23.44
PAYE workers are expected to have the Property Tax deducted at source
PAYE workers are expected to have the Property Tax deducted at source

The Government is considering the introduction of a property tax that may be calculated at 0.2% of the value of a home.

The tax is due to be unveiled in the upcoming Budget 2013 and introduced in July 2013, replacing the Household Charge.

The 0.2% rate would mean a property worth €175,000 would pay €350 annually and a home worth €275,000 would pay €550.

As the charge is proposed to come into effect in the middle of 2013, home owners will only be hit with half of the charge next year and a full levy in 2014.

It is expected that PAYE taxpayers would have the tax deducted as a tax at source.

This would allow for payments to be spread instead of paid in a lump sum.

However, there is a possibility that the Government could increase the charge to 0.25% of the value of a home if tax revenue for November is weaker than had been hoped.

There is speculation that corporation tax, which is paid by companies on their profits, may not be as strong as it had been in earlier months.

November is also a critical month because it is time when self-assessed income earners file their tax returns.

Speaking to journalists today the Minister for Finance Michael Noonan said that there was an expectation that the Budget would be tough but he stressed it would be fair.

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