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Property Tax Reform

The Northern Ireland Experience

William J. McCluskey and Nigel D. Woods

November 2010, English

This paper reviews the strategic approach, the policy development and the implementation of a major reform to the residential property tax in Northern Ireland. This reform, the first in some 150 years, was seen as fundamental in addressing many of the structural weaknesses and inequities of the previous property tax. The strategic approach to the review was to adopt a five stage process, including determining the facts and key issues; the development of policy options; consultation; decision making; and finally implementation. A key theme throughout the whole process was open consultation and communication with all the stakeholders, particularly taxpayers. The policy development process mainly examined the alternatives to the then existing rental value assessment basis for the residential property tax. An option was to adopt the banded value approach used in England, Scotland and Wales. The government ultimately decided to adopt an approach based on the discrete capital value of the dwelling. Implementation involved: preparing and passing the necessary legislation; the revaluation of all the dwellings in the Province (approximately 700,000), the previous revaluation being in 1976; and the subsequent publication and notification process for the new values, which contained a number of innovative elements.

This paper has evaluated the reform and identified a number of key lessons including, political buy-in and leadership, external inputs, time frame and the taxpayer notification and enquiry process. These key lessons whilst some are unique to the reform in Northern Ireland could be important for other jurisdictions considering major property tax reforms.


Assessment, Property Taxation, Public Policy, Tax Reform, Taxation