Virus hit firms will be able to defer rates payments

Businesses most impacted by the coronavirus outbreak will be able to defer the payment of their commercial rates for three months under a plan agreed by the Government with local authorities.

The deal will relate primarily to the retail, hospitality, leisure and childcare sectors and will last until the end of May.

In a statement, the Government said the measure would be implemented by each local authority in its own area.

Short term financial support will be made available to local authorities to mitigate the impact on cash flow and critical service delivery, like emergency response, housing, homelessness, parks and amenities.

Every year, firms contribute €1.5 billion in commercial rates to local authorities, providing an average of 33% of their funding.

The Department of Housing, Planning and Local Government said individual local authorities are already dealing with difficulties experienced by rate payers on a case by case basis.

“Any commercial ratepayers that have had to temporarily close or significantly curtail operations during the COVID-19 response period should contact their local authority immediately in relation to any rates payments falling due in the period to end-May,” it said.

“Ratepayers that can continue to pay their outstanding local authority rates should continue to do so in the normal way.”

Chambers Ireland said the move offered some relief to businesses who have had to close in recent days.

But it added that as the crisis evolves, an extension of the deferral would be required.

“The extent of the crisis we are facing is still uncertain,” said Chambers Ireland CEO, Ian Talbot.

“Businesses that closed over the weekend and since then, have no idea when normal trading conditions might resume. Recovering from this shock will be an enormous task and every assistance possible must be made.”

“Because of this, Government must commit to extending the Rates relief to correspond with the duration of the crisis. Government must also ensure that sufficient monies are made available to local authorities, as and when needed, so that essential local services can continue to be funded.”

While the Irish Hotels Federation said proposals to defer rates payments are wholly inadequate and a futile exercise that will do little to get the 260,000 people in Irish tourism back to work.

“Securing jobs is our priority now and it is disappointing that the Government does not realise the reality of what is needed,” said Elaina Fitzgerald Kane.

Earlier the chief executive of Dublin City Council has said he favours dealing with hardship faced by some businesses in Dublin on a “case by case” basis rather than implementing an across the board freeze on commercial rates in the city due to the Covid-19 crisis.

Owen Keegan said that many businesses are functioning as “near normal”‘, while others doing well and he does not see any reason why they should not pay their rates.

Mr Keegan told Morning Ireland that the income from rates is necessary to keep services going, including some essential services likes water and emergency ambulances in the city.

Owen Keegan said he accepts that the hotel sector is badly affected and asked those businesses to contact the Council, saying they will be dealt with “in a sympathetic way”.

‘Clearly if they can’t pay we will recognise that – we won’t be pursuing anyone in court and will be reasonable,” Mr Keegan said.

He said that a reduction in the Council’s overall income is likely.

Mr Keegan also said that social housing tenants’ rent is income-related, so if these tenants lose their jobs their rent will automatically reduce.

In this regard, they are in a better position that private tenants, he added.

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