Water charges and property tax may be combined, says FF

Fianna Fáil is to consider merging the property tax and water charges in a potential compromise.

The Irish Times has learned party leader Micheál Martin is examining the prospect of amalgamating the two levies into one household charge.

However Mr Martin, who has discussed the issue with key members of his front bench, is stressing the potential move will not be considered until 2019 when the property tax is due for revaluation.

He is understood to be studying the situation in Northern Ireland and the United Kingdom for guidance on how to roll out such a charge.

This would ensure Fianna Fáil abides by its core election policy to end the water charging regime and also comply with European Commission rules.

Previously, party figures have said it would be too difficult to achieve a combined water and property charge while preserving the principle of conservation or “polluter pays, as required under EU rules.

Revenue Commissioners

It was also previously argued by some in Fine Gael that it would be difficult to combine a tax collected by the Revenue Commissioners with a usage charge collected by a utility company.

However, senior Fine Gael figures have said they would also be open to such a move, as long as it preserved the principle of some charges being paid.

Senior sources in the party yesterday insisted a combined charge could be achieved if there is a willingness to do so.

“It could be done if people really wanted to,” said one Fine Gael Minister.

A similar style charge, combining water and property levies, was tabled by former minister for the environment Phil Hogan a number of years ago. It was eventually rejected.

The report by the expert commission examining the future of water charges was published in full on Tuesday.

Chaired by former Labour Relations chair Kevin Duffy, the commission recommends normal water usage should be paid through general taxation, with a charge being levied for "wasteful" usage.

Each home will receive an allowance “that corresponds to the accepted level of usage required for domestic and personal needs”.

Special exemptions

It insists special exemptions for those with medical conditions and others who require “high water usage should be maintained”.

The report will now be sent to an Oireachtas committee for examination and it will have three months to make a proposal to the Dáil for a vote.

Fianna Fáil's housing spokesman Barry Cowen said a final party position would not be adopted until the deliberations of the committee were complete. "I firmly believe that the Special Oireachtas Committee on Water should now be given space to fully examine the report and to explore all of its recommendations," he said.

Minister for Housing Simon Coveney yesterday ruled out refunding those who had previously paid water charges and indicated his focus would be on retrieving unpaid charges from those who did not pay their bills.

While Fianna Fáil had proposed to refund those who had paid their charges through a tax credit, party sources now declined to commit to this position.

“We are not sticking to anything, we are just sticking to the report,” said a party source. “We could come up with a range of options during the process of the Oireachtas commission.”

The members of the Oireachtas committee are Fianna Fáil's Mr Cowen, Willie O'Dea, John Lahart, Mary Butler and Lorraine Clifford-Lee.

Kate O'Connell, Colm Brophy, Alan Farrell, Jim Daly, Martin Heydon and Paudie Coffey will represent Fine Gael.

Sinn Féin's Eoin Ó Broin and Jonathan O'Brien, Labour's Jan O'Sullivan, Anti-Austerity Alliance's Paul Murphy and Independent TD Seamus Healy will also participate.