Report of the Local Government Efficiency Review Group

2. Reintroducing domestic water charges, starting with low flat
fees, gradually increasing, and structured so as to incentivise
the installation of meters;
3. New revenues from 1 and 2 above should replace the motor tax
contribution to the Local Government Fund;
4. Greater cost recovery should be made in areas such as
commercial water charges and planning fees;
5. Removal of a series of exemptions to commercial rates, such as
those for state properties, larger B&Bs, farm buildings owned by
corporate bodies, off-shore structures such as windfarms and
power stations, and part-rating for third level institutions and
community halls where a significant amount of commercial
activity takes place;
6. Standardising the approach taken to vacancy relief for
commercial rates;
7. Removal of maximum rent levels (while respecting the principle
of rents being based on ability to pay);
8. Periodic review of the needs and resources model in
conjunction with local authorities;
9. Exploring other options, such as a tax on undeveloped zoned
land to prevent hoarding, a ‘betterment’ tax on gains and
increases in land value due to zoning decisions or investment in
public infrastructure, and the introduction of a bed levy to
enhance tourism facilities in local authorities with high tourist
numbers.
2.6.5 The Commission also supported the views of the OECD review of the
Irish public service and Transforming Public Services (see above)
that greater use should be made of shared ‘back-office’ services.
2.6.6 Many of the issues raised in the Commission on Taxation report fall
within the remit of the Local Government Efficiency Review Group,
and are addressed in subsequent sections. However the question of
a tax on undeveloped land or on gains from zoning decisions largely
relates to capital expenditure.
2.7 Financial Trends
2.7.1 This section plots changes over the past decade in local government
current income and expenditure. Figure 2.6 illustrates trends in local
government expenditure across different service divisions over the
past decade while Figure 2.7 illustrates trends in local government
revenue sources over the same period.
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