Kenny rules out implementing IMF's property-tax recommendation
Taoiseach Enda Kenny has ruled out implementing recommendations from the International Monetary Fund’s (IMF) review of the Irish economy.
As his parliamentary party meeting closed, Mr Kenny played down the importance of the agency’s staff report, which advised a new property tax set at 0.5% of the value of a home.
He said the review – an IMF standard for all its 188 member states – was “not binding”.
“I wouldn’t take any recommendation from the IMF report, this is a medium and long-term report that focuses on a range of issues,” Mr Kenny said.
“The Government will obviously reflect upon what the IMF has said but we have certainly rejected the basis of collecting €1bn from a property tax on the basis of a 0.5% valuation.”
As he closed the Fine Gael think-in in Westport, Co Mayo, Mr Kenny insisted the IMF review and its recommendations were compiled separately from officials from the bailout Troika of the European Central Bank, European Commission and the IMF.
He said if any minister felt there was value in any of the proposals they could be considered, but ultimately all budgetary matters would be for the Cabinet alone to decide.
The report, published yesterday, said there was considerable scope for further base-broadening measures to raise revenues.
It stated a value-based property tax would be important as “a progressive and stable source of revenue”, and suggested a levy based on 0.5% of an individual’s home.
This would see the owner of a property worth €200,000 forced to fork out €1,000 every year on the tax.
But Finance Minister Michael Noonan yesterday flatly rejected the recommendation, saying the rate was too high.
The property tax, whaever its shape, will take effect in July 2013. Further details on how it will be collected and how much it will cost will emerge in time for Budget day on December 7.
The IMF also said in its report the Government could shore up around €1.25bn through various spending cuts and tax hikes.
It suggested broadening the personal income tax base, chopping social welfare and restructuring motor taxes as further ways to make savings.
Meanwhile, Mr Kenny also insisted he would not consider a Cabinet reshuffle any time in the near future.
Despite joking last night that he would think about a rejig and stating earlier today that it was a Taoiseach’s job to do so, he said he has more pressing matters.
“A reshuffle is not a priority. We have a very big job ahead of us,” he said.
Elsewhere, in Maynooth, Co Kildare, where Labour’s annual think-in got under way, Tánaiste Eamon Gilmore dismissed Mr Kenny’s quip about a reshuffle.
The Labour leader insisted the Taoiseach made his comments in jest, saying: "He cracks good jokes."
