Q: What is happening?

A: The changes to the unpopular tax are part of the Government’s pandemic recovery package.

A new valuation will be made of all homes, including newly-built homes that were exempt up to now. It will be applied from November of this year.

This will mean homes built after 2013 will face inclusion in the local property tax system for the first time.

Currently the tax is levied on property valuations from 2013.

However, homes that were not built at that time do not have a liability as they do not have a valuation dating from then.

Q: Property values were at a low in 2013, so will I end up paying more?

A: Property values hit a low in 2013, but have since shot up by 90pc, according to the Central Statistics Office.

Finance Minister Paschal Donohoe said there would be an adjustment to the property tax bands and the thresholds to ensure that not all homeowners end up paying more.

But he admitted that some will end up paying around €90 more a year in the property tax.

“Most will not face an increase in the tax. We will do all we can to ensure bills are affordable,” he told RTÉ Radio.

On those who have had an exemption up to now, because they bought or built a brand new property, he said: “I believe it is right that all homes pay the Local Property Tax. It is a tax for local services.”

Q: How much more will the tax raise?

A: The Government would make changes that recognise the affordability issues facing many families at the moment, he added.

It is estimated that up to 100,000 have benefited from the exemption from the tax for newly-built homes.

Mr Donohoe said the changes would bring in between €80m and €90m in additional revenue from the tax once they are in place, taking the total yield to €560m.

It is understood that six out of 10 homeowners will not end up paying more property tax from the changes.

Around 10pc will pay less. But up to a third of those already paying the tax face paying more. This is because they will move into a higher property tax band.

Q: How will the changes work?

A: The tax is based on a number of valuation bands. All homes under €1m in value pay at a rate of 0.18pc.

The valuation bands mean that a home that is currently worth €340,000 is taxed at €585 a year.

This is because it falls in the €300,001 to €350,000 valuation band. To calculate the tax you take the mid-point, which is €325,000, and apply the 0.18pc to that to get the tax due.

But the tax is to be “recalibrated” with different bands, and a different tax rate, the minister indicated.

Q: How are the changes going down with the opposition?

A: Sinn Féin housing spokesperson Eoin Ó Broin called for the tax to be scrapped.

“The property tax is one of the most regressive taxes that was ever introduced.

“It applies to debt as well as to the assets. It takes no account of inability to pay,” he said.

“I sat on on South Dublin County Council when this tax was introduced. For every euro that was raised in local property taxes on South Dublin County Council, a euro was taken away in central government grants. In fact, we were no better off.

“This tax needs to be scrapped,” Mr Ó Broin said.

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