Property Tax rate may be set at 0.2% of home value

The Cabinet is considering the introduction of a Property Tax that would be calculated at 0.2% of the value of a home.

The tax is due to be unveiled in the upcoming Budget and introduced in July 2013, replacing the Household Charge.

The 0.2% rate would mean a property worth €175,000 would pay €350 annually and a home worth €275,000 would pay €550.

As the charge will come into effect in the middle of 2013, home owners will only be hit with half of the charge next year and a full levy in 2014.

It is expected that PAYE taxpayers would have the Property Tax deducted as a tax at source.

This would allow for payments to be spread instead of paid in a lump sum.

However, there is a possibility that the Government could increase the charge to 0.25% of the value of a home if tax revenue for November is weaker than had been hoped.

There is speculation that Corporation Tax, which is paid by companies on their profits, may not be as strong as it had been in earlier months.

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