Local Property Tax (LPT) is likely to increase next year for the majority of homeowners.
Revenue have begun the process of writing to the 1.5 million homeowners in the country, asking them to re-evaluate their property's value.
This re-evaluation will be used to determine the amount of Local Property Tax homeowners will pay for the next five years.
House price inflation has increased by around 25% nationally since the last time owners were asked to value their properties for LPT.
However, Katie Clair, principal officer for the LPT at Revenue said that while a tax increase is expected for most people, the increase itself will be relatively small.
This is because the valuation bands for properties have been broadened and the base rate of LPT has been reduced.
By November, homeowners are required to revalue their properties.
This revaluation will be used to determine the amount homeowners owe for Local Property Tax for the next five years.
Homeowners are required to do three things:
- Determine the valuation band of their property
- Submit their LPT return, including their valuation by 7 November
- Pay or make arrangements to pay the LPT charge
Ms Clair said all three steps can easily be done online and the process takes less than five minutes to complete.
"If you consider a property that was worth €200,000 in November 2021, chances are that property is worth about €252,000 now," she explained.
"If you're in Dublin, you're paying €195 for the last four years. And that will increase to €220 in 2026. So that's an increase of €25."
"There will be increases across the board, but they will be relatively small," she added.
Local authorities changes to LPT
Though a relatively small tax, LPT has been a contentious topic since it was first introduced in 2013.
The tax was introduced to provide a stable income source to the 31 local authorities in the country. Councils have the ability to increase or reduce the tax by 15%.
Local authorities have discretion to increase or decrease the rate of LPT for their area by +/-15%.
RTÉ's This Week asked all 31 local authorities about their LPT charge. More than one-third of councils have voted to increase the LPT for 2026.
Dún Laoghaire-Rathdown County Council is the only local authority that reduces LPT by the maximum amount of -15%.
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Just three local authorities will reduce LPT from the base rate in 2026 and a further three will not deviate from the base rate.
All other councils have voted to increase the LPT from the base rate for next year. 20 of the 31 local authorities will have increase the LPT charge to the maximum allowed amount of 15%.
However, from next year, local authorities will have the ability to vote to increase the LPT from the base rate by up to 25%
Carlow County Council raises LPT to 15%
In July of this year, Carlow County Council voted to increase the LPT from its base for the next four years.
The motion was proposed by Fianna Fáil councillor Fintan Phelan.
"As a council, we felt that the additional funds that we could take in from the property tax could be put to good use," he said.
"We had a 5% increase over the last number of years; in practical terms it's €9.50 for 55% of households [in Carlow]."
The additional income raised by the increase in the LPT has been ring fenced for projects in each municipal district in the local authority.
As a representative of Carlow Town, Mr Phelan pointed out the local paint scheme, flower boxes and murals that are in the town, he says, due to the LPT.
Fellow Carlow Town representative, People Before Profit's Adrienne Wallace, was one of four councillors who voted against increasing LPT.
"I think the Local Property Tax ultimately is regressive and it doesn't fund councils as well as the previous scheme did," she said.
"This [increase in LPT] brings in an additional €620,000, but we're short millions, across all local authorities."
In 2008, central Government provided local government with just over €999 million in funding. At this time there was no LPT.
Next year, funding provided to local authorities by the Local Government Fund will be €744 million. This includes the expected increase from the LPT.
Cllr Phelan said he agreed with Cllr Wallace on the need for more funding from central Government, but he said he wanted to be practical.
"I have a responsibility to ensure that the council does all it can for the people of Carlow," he said.
"I constantly have constituents on to me in relation to having more parks, having the town clean and tidy, having more businesses open up in our town and I think the additional funding that we received through the Local Property Tax allows us to do that."
He added: "I'm about delivery."
"What matters to people on the ground and that's the council delivering for them. I think the additional funding through local property tax allows us to redouble those efforts."
Not enough money to address system issues in Carlow
Cllr Wallace said that the LPT is not enough money to address the system issues for people in Carlow.
"Absolutely, the town looks great, but there's a lot more could be done if we had increased funding and that's the bottom line here.
"I reject the narrative that this is a choice between increasing by 15% or decreasing by 15%.
"This is about regressive taxation or progressive taxation.
"Do we want to draw down more from central Government, or do we want to keep coming after people who are already hard-pressed so that we can do minimal works here in the town?"
As well as increasing the base rate for LPT, the increase in property values could also have an impact on the amount owed in LPT, despite the fact that Revenue have widened the tax bands.
Based in Carlow town, Marcus McCormack, at DNG McCormack Properties estimates that the average homeowner in Carlow will pay between €35 and €40 extra in LPT next year.
"The property market has changed considerably since 2022, and we've seen a big uplift in values," he said.
"The average price here in Carlow, for example, across the market would have been 200,000 roughly in 2022.
"That has now risen to about €265,000 maybe €270,000.
"For example, a three-bed semi back in 2002 here in Carlow Town would have been making around €240,000. That current price now is achieving €320,000 so there's a significant uplift."
