Commercial rates for businesses in Louth should be suspended for at least 12 months, a Fianna Fáil councillor has said, after Louth County Council admitted there were not yet in a position to clarify their position on the matter.
Having previously said last week that they would follow government guidelines on the issue of allowing businesses a break in the payment of their commercial rates, the local authority admitted on Monday that they were no closer to reaching a firm stance on the matter. This is despite Ministers Eoghan Murphy and Paschal Donohoe saying that commercial rates for the most immiedtaley impacted businesses would be deferred until the end of May.
They also announced short-term cash flow support for local authorities suffering knock-on financial difficulties.
In response to a query for clarification on a moratorium of rates from Councillor Emma Coffey during Monday’s monthly meeting of Louth County Council, Chief Executive Joan Martin described the issue as “complicated” and “not clear cut.”
“The bottom line is we will always deal with businesses in a sympathetic manner,” she said. “A moratorium could present councils with considerable cashflow difficulties. We are where we are. We will have cash flows difficulties from that and from the loss of money from pay parking. That is a big amount of our income as well.
“We haven’t thought it through yet. We will clarify our thinking on it. As of today, we will not be taking anyone to court who can’t pay because of Covid-19.”
Cllr Coffey’s Fianna Fáil party mate James Byrne says clarification is needed as soon as possible. “At present rates have been suspended for at least two months with no estimate on the financial support for councils disclosed to date to fund the shortfall in revenue as Louth County Council deals with the situation on a case-by-case basis.
“This could be administratively difficult given the volumes of businesses likely impacted by the COVID-19 crisis,” Cllr Byrne told LouthNow.ie.
“I believe it’s incumbent on the Government to address the situation more decisively and immediately to support local government. Greater clarity and certainty is needed right now.”
Cllr Byrne said he believes the economic fallout from the pandemic will require a moratorium on rates to be implemented for at least 12 months. “There must be a moratorium on rates for at least a year, possibly longer as the fallout from this crisis could extend well into 2021 even if the health experts can get a grip on the COVID-19 pandemic in the coming months ahead.
“It will be a long road to recovery for many SMEs,” he added. “In addition, any business that has paid already and has suffered from recent closure or slowdown in business should be entitled to a rebate of rates already paid this year to help with cash flow.
“Approximately €1.5bn is collected annually from commercial rates by councils. The expected shortfall in the coming months must be adequately provided for in the overall suite of measures the Government introduces to combat the economic shock from this global health crisis.”
Louth County Council’s annual budget for 2020 shows the local authority expect to bring in approximately €35 million through commercial rates, but any moratorium could leave a potentially massive hole in it’s finances which will have a knock on effect on provision of services.