Finance Minister Michael Noonan has said the new local property tax, will start on July 1 for the second half of the year.
The rate of the tax will be 0.18% of the property's market value up to €1m and 0.25% on values above that level.
The Finance Minister said the rates will not be varied during the lifetime of the Government.
He said the new tax will be collected by the Revenue Commissioners and owners of residential properties, including rental properties, will be responsible for payment of the tax.
The tax will be payable on the basis of the market value of the property as assessed by its owner.
Revenue will provide valuation guidance to which owners can refer, the Minister added.
Explaining how the tax will work, the Minister said that properties with a value of over €100,000 and less than €1m will be assessed at the mid-point band of €50,000.
Properties valued between €150,001 and €200,000 will be assessed at 0.18% of €175,000. Properties below €100,000 will be assessed at 0.18% of €50,000.
Properties valued at over €1m will be liable at 0.18% on the first €1m and 0.25% on the balance, with no banding applied.
The tax will be payable on the basis of the market value of the property as assessed by its owner.
Revenue will provide valuation guidance to which owners can refer, the Minister added.
The Minister said that property owners will be able to choose from a wide range of payment options including payment by direct debit, cash payments, credit or debit cards, or deduction at source from salary or certain State payments.
Certain properties will be exempt from assessment and these will mainly correspond to exemptions from the household charge.
The Minister said that from 2015, local authorities will have the power to vary the rates by 15% above or below the central national rates to better match their funding needs.
Mr Noonan said the household charge will cease with effect from January 2013 and the non-principal primary resident charge (second home charge) will cease from January 2104.
''The local property tax is fair and progressive as all property owners make a contribution but those who own the most valuable properties will pay the most,'' the Minister stated.
