Designing and implementing a local residential property tax from scratch: lessons from the Republic of Ireland

Assigning recurrent taxes on immovable property to cities, municipalities, and rural districts is a common practice around the world. The Republic of Ireland is no different, with its annual taxes on real property assigned to local government. Following the 2008 financial crisis and the austerity era that ensued, Ireland’s property taxes underwent major reform, most notably the design and implementation of a new residential property tax 35 years after abolition of the previous system of ‘rates’ on residential properties. In this paper the new or different features of Ireland’s residential property tax are outlined, including the use of self-assessment and valuation bands, innovative payment methods and also the multiple compliance mechanisms for taxpayers. While recognising the importance of country-specific and local circumstances in property tax design, the paper concludes that elements of Ireland’s new residential property tax have potential lessons for other jurisdictions contemplating similar tax reform. These relate to the key tax principles of simplicity and public acceptability, and on specific design features of assessment and valuation, and collection and compliance.


Introduction
Worldwide, local governments ('councils' in Ireland) are typically funded by a combination of ownsource revenues (mainly local taxes and charges) and grants or transfers from higher levels of government. The Irish system of local government is no exception as it is funded by a mix of local taxes, fees/charges, and central government grants. 1 The only local tax is on immovable or real property, CJLG December 2022 84 with annual taxes on the ownership and use of residential and non-residential properties fully assigned to Ireland's local councils (Turley and McNena 2019).
One of the stylised facts of local property taxes worldwide is their diversity, both in terms of the amount of revenues that are raised and, more relevant for this paper, their design features and characteristics.
Using the background of a country that is highly centralised, with an economy and property market that suffered enormously from the 2008 financial crisis, and whose public finances were subject to much austerity in the 2010s, this paper outlines the property tax reforms that were designed and successfully implemented at that time despite strong political and public opposition. Central to these reforms was the introduction of a new residential property tax in 2013: there had been no annual tax on residential properties since 1978 when the previous form of property tax (domestic 'rates') was abolished. In particular, a number of property tax design features were introduced that have "interesting peculiarities that makes it [ie the Irish system] relevant for countries that aim at implementing a reform nearly from scratch" (OECD 2021, p. 118). This study describes these features and, in doing so, identifies potential lessons for other jurisdictions contemplating property tax reform, albeit in different political settings and economic circumstances.
The paper begins with the theory of local government and tax assignment. The following section provides some country-specific context on local government finance in Ireland. The residential property tax reforms are then outlined, with a focus on the different or new system features. The paper ends with a discussion and some lessons from the Irish experience.

Local government and tax assignment: the theory 2
Compared to central government provision of uniform services, local government achieves greater economic efficiency by facilitating the matching of public service outputs with local preferences. Using the benefit taxation model, in order to maintain the link between benefits received and taxes paid, those who benefit from local government expenditure should pay for it. Where benefits do not extend beyond definable local areas, allocative efficiency can be best achieved by providing public services at the lowest feasible level of government (Oates 1972).
As long as there are differing preferences for the outputs of local public goods and different costs in local public service delivery from place to place, there are welfare gains from fiscal decentralisation.
Formalised by Oates (1972), this fiscal decentralisation theorem presents the economic case for local government. A summary of the theorem is that by "tailoring the outputs of local public goods to the particular tastes and costs of specific jurisdictions, the decentralised provision of local public goods CJLG December 2022 85 promises higher levels of social welfare than a centralised regime with more uniform levels of outputs across all jurisdictions" (Oates 2010, p. 10).
An earlier and rather different perspective was presented by Tiebout in his theoretical model of consumer-voter choice. If citizensseen as consumersare faced with a choice of areas offering different types and levels of public services, as consumers they will choose the local area that best reflects their preferences, by 'voting with their feet' (Tiebout 1956). In this case, a political solution is not required to provide the optimal level of public goods as the market is said to be efficient.
Not altogether dissimilar, but more focused on the design of jurisdictions, Olson's principle of fiscal equivalence assigns revenue-generation powers to central and local governments commensurate with expenditure responsibilities and, where possible, aims for a close match between benefit, tax and electoral areas. Adopting this approach, when citizens reside in several overlapping jurisdictions, they should pay taxes to each level corresponding to the benefits that they receive from each jurisdiction (Olson 1969).
Once expenditures have been assigned according to the fiscal decentralisation theory set out above, the next step is to assign appropriate revenues, in the form of taxes, transfers or borrowing. Together, these elements constitute the four pillars of intergovernmental fiscal relations. 3 This paper focuses on the issue of tax assignment: who should tax what?
The decision as to which taxes should be assigned to which levels of government constitutes the tax assignment problem of intergovernmental finance. Although the traditional fiscal federalism model underlying expenditure assignment is straightforward, with local government primarily responsible for the efficient provision of local public services characterised by few spillovers and limited economies of scale, that is not the case for tax assignment (Musgrave 1983).
The taxes assigned to local government should meet certain criteria. As set out in Bird (2001), the characteristics of a good local tax are that the tax base should be relatively immobile and visible; the tax should be mainly borne by local residents and not easily exported; it should be relatively evenly distributed, perceived as reasonably fair and relatively easy to administer; and the tax yield should be adequate to meet local needs and be relatively stable and predictable. The tax that best meets these criteria is property tax. 4 3 More formally, the four pillars are expenditure assignment, tax assignment, intergovernmental transfers, and borrowing and debt. 4 The International Monetary Fund (IMF) in its October 2013 Fiscal Monitor Taxing Times report concluded that "there is a strong case in most countries, advanced or developing, for raising substantially more from property taxes" (IMF 2013, p. viii). Ireland's new residential property tax was introduced in the same year, with the support of the IMF as outlined later in this paper.
Relative to other potential sources of local tax revenues, a local property tax scores highly in several ways. First, land and/or buildings are obviously immobile and salient; second, the tax on such is borne primarily by local residents who benefit from the services supplied; third, information required is likely to be available locally; and fourth, the property tax yield is relatively stable and varies less with the business cycle than other taxes. 5 In addition, a well-designed property tax is relatively neutral with respect to its impact on economic decision-making and behaviour (Bird 2006;Slack 2015).
Overall, property tax is a mainstay of municipal finance, with a majority of local governments worldwide relying on some form of recurrent property tax. 6 Indeed, in this instance we can say that the public finance theory and practice coincide, as any rational assignment of taxing powers should see local government assigned a tax on real property. Bird (2006, pp. 181-184) writes that a "property tax is indeed an excellent local tax", and "undoubtedly the pre-eminent local tax". Similarly, the Mirrlees Review in the UK noted that: "The fact that land and property have identifiable and unchangeable geographic locations also makes them natural tax bases for the financing of local government" (Mirrlees 2011, p. 368).

Country context: local government finance in Ireland
Ireland, with a population of just over five million and a surface area of 70,000 km 2 , is a unitary country with two levels of government, central and local. The local government tier consists of 31 councils: three city councils, 26 county councils, and two combined city/county councils. The sub-county town governments were abolished in 2014 as part of a wider reform of the public sector, largely motivated by efficiency gains, cost reductions, and austerity measures (Government of Ireland 2014).
Ireland has a very centralised system of governance, with limited functions assigned to local government. This is partly due to the inherited British tradition, but also a general disdain by successive Irish governments for local administration, which was often perceived as inefficient and corrupt (Callanan 2018). In the early days of independence, there was a preference for central control, with national regulation of local government that has not diminished over time.
Local government's narrow remit is in the provision of purely local services and social housing. The main functional responsibilities are in the area of local and regional roads, planning and land use, local economic and community development, fire and library services, local amenities, and the provision of 5 In supporting property tax but acknowledging that it is the tax that everyone loves to hate, Rosengard (2013, p. 173) describes property tax as "roughly progressive, loosely correlated with local government benefits [and] a relatively good proxy for a tax on multi-year income". 6 Although there is considerable variation in the degree to which countries around the world levy revenues from property taxes, the yield is modest in most countries (Nooregaard 2013; Slack 2022).
CJLG December 2022 87 housing services. 7 Unlike many other sub-national jurisdictions, Irish local government has no role in the delivery of health, education or social care services.
Comprising a mix of transfers from central government and own-source revenues, the funding of local government in Ireland comes from three sources: grants, charges and fees for services, and local taxes.
The local tax is a property tax, with two components: one tax on non-residential properties (commercial rates) and a separate one on residential properties (the Local Property Tax, or simply LPT). 8 A breakdown of local government revenue sources is presented in Table 1. Although it is common worldwide for local authorities to tax non-residential properties relatively more than residential propertiesoften for political rather than economic reasonsthe difference between the shares generated from commercial rates and from LPT as reported here is striking. The paper returns to this issue in the final section.

Revenue source Percentages
Central government grants 40 Charges and fees 25 Commercial (non-residential) rates 28 LPT 7
In sum, Ireland's system of local government is relatively smallprimarily a provider of local services; it is funded by a mix of central government specific-purpose grants and own-source revenues in the form of charges/fees and local property taxes; and it is limited in terms of autonomy as central-local relations are characterised by extensive regulatory, administrative and financial controls by central government (Turley and McNena 2019).
Another outstanding and rather unique feature of local government finance in Ireland at the outset of the 21 st century, and until 2013, was the absence of a residential property tax. 7 Water services were reassigned from the local authorities to a national utility (Irish Water) in 2014. Although Irish Water is now primarily responsible for water services, there are service level agreements in place between the local authorities and the utility company so that the local authorities continue to act as its agents. 8 For more details on the funding of local government in Ireland, see Turley and McNena (2019). For a discussion on the non-residential property tax, see Turley (2022).

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The new residential property tax The common design features of any residential property tax are the tax base, liability, rate, assessment, valuation, and collection/compliance. Property tax system features and the main options available to the Irish authorities at the outset of considering the new tax are outlined in Table 2. Source: Author. The actual design characteristics chosen for the new LPT are in bold.
The design of any property tax system, however, is not simply a technical matter, but depends on other factors such as the economic and political circumstances of the time, as well as the history of property taxes pertaining to the specific jurisdiction. Prior to 1978, residential properties in Ireland were subject to property tax in the form of (domestic) rates, similar in design to the commercial rates regime that existed then and still applies to non-residential properties. 9 The two common criticisms of the domestic rates system and the reasons for its abolition were a) the steep rises in rates largely attributable to rising health expenditures (that were at the time devolved to local authorities), and b) out-of-date valuations leading to inequities and a regime considered to be regressive and unfair (Callanan 2018).
Given the prevalence of residential property taxes in developed countries, the absence of a recurring tax on residential properties meant that Ireland was an outlier, with successive governments under pressure to correct this anomaly. Although there was a succession of reviews of local government funding and taxation that recommended a local residential property tax, it was the 2008 financial crisis that triggered its reintroduction. Given the booming property market and imprudent taxation decisions taken by national policy-makers leading up to the 2008/09 economic crisis, a condition of the financial support provided to Ireland by the European Commission, International Monetary Fund and European Central Bank was the introduction of a residential property tax as a means to widen the tax base.
At the outset, there were a number of problems to be addressed. There was much political and popular resistance to a new tax, and especially one on property given Ireland's historical affinity to land and CJLG December 2022 89 home ownership. There was also opposition due to the difficult economic environment of the time, dominated by years of austerity. On a more technical level, there were significant logistical challenges facing the authorities (and the national tax collection agency, known simply as Revenue)and none more so than the absence of a single and comprehensive database with up-to-date information on property ownership and valuations.
In 2012, an Inter-Departmental Group was established to design a 'local property tax'which later became the LPT. Guided by the usual tax principles of efficiency, equity, simplicity and transparency, the terms of reference were to consider the design of a tax that would, among other objectives, "provide a stable funding base for the local authority sector" and "ensure the maximum degree of fairness between and across both urban and rural areas" (Inter-Departmental Group 2012, pp. 116-117). 10 As with any new property tax, and in this case one assigned to local government, the Group examined all the key design elements of a property tax. Its principal recommendations are reported in Table 3.

Liability, base and exemptions
Owners of residential properties be liable for the tax, but with certain exemptions permitted

Assessment and valuation
Market value (including improvements) of residential properties using valuation bands and the tax rate applied to the mid-point, with a system of self-assessment Development of a register of residential properties be undertaken as a priority

Local autonomy
All revenues accrue to the local authorities, incorporating a locally determined element

Administration agency
Revenue, the national tax collection agency, be given responsibility for all aspects of the local property tax

Payment methods
Provision for collection at source from payroll and from recurring and lump-sum payments made by government departments Source: Adapted from Inter-Departmental Group (2012).
With the Irish Government adopting the majority of the Inter-Departmental Group's recommendations, including all of the above, this report formed the basis of the new LPT (Government of Ireland 2012). 11 The timelines for the reform process are shown in Table 4

March 2013
Launched, property register compiled, followed by taxpayers' education and communication campaign LPT return form and information issued

May 2013
Property valuation by self-assessment (and for the next three years) LPT return to be filed

July 2013
Payment due One of the biggest challenges in designing the new tax related to assessment and valuation, given the absence of an up-to-date database of residential properties. This may explain the decision to opt for self-assessment and the use of valuation bands. Revenue did provide guidance to taxpayers (see Figure   1), in the form of an online interactive guide (namely average property valuation bands in a locality, but not for individual properties); and a 'Revenue estimate' was used as a default liability in the absence of a LPT return. 12 The liable person, namely the owner, was required to file an LPT return (essentially the valuation band, with no requirement to return any property characteristics or specific property value) and pay the tax, based on their own assessment of the property's market value.
The valuation bands were initially €50,000 in width (for 18 of the 20 bands, the first band being from €0 to €100,000 and band 20 being greater than €1 million). The basic rate was 0.18% applied to the mid-point of the relevant band, with a higher rate of 0.25% applied to that portion of a property's value in excess of €1 million.
From the perspective of local rate-setting powers that are meant to ensure a degree of autonomy and accountability for municipalities, there is a local adjustment factor (LAF) whereby local authorities can vary the basic rate by +/-15% annually. If the LAF is applied, the tax rate reverts to the normal basic rate after the year has elapsed. Allowing +/-15% created a potential minimum tax rate (or lower bound) of 0.153% and a maximum rate (or upper bound) of 0.207%. This is not uncommon in other European countries, as a compromise between an upper tier level of government retaining the power to set the rate, and local government having some flexibility to vary the rate to reflect local conditions and ensure a degree of autonomy. Initially local authorities were slow to use this discretion, with a majority of councils in the first few years opting to leave the basic rate unchanged (and those that did use this taxing power all implemented a cut in the rate). Over time, however, the number of local authorities exercising these powers increased, as did the number of councils that increased the rate. can be viewed as an indication of both autonomy and responsibility. Whereas no local authority increased the basic rate in the first two years that these powers were in force, 22 used their taxing powers to increase the basic rate in the years 2021 and 2022 (largely to pay for increased spending due to the COVID-19 pandemic), with 11 of them opting for the full +15% variation. Revaluation was deferred in 2016, and again in 2019/20, finally taking place in November 2021, but only after changes were made to the bands (a widening of the intervals from €50,000 to €87,500 in most cases, equal to an increase of 75% to match the property price increases), and to the basic rate (a reduction to 0.1029%) to ensure that the majority of LPT payers would not see a rise in their liability (Thornhill 2015; Government of Ireland 2021). 13 The rate and yield of the LPT (circa €500 million, equal to about 7% of local government revenues and less than 1% of total tax revenue, and diminishing) therefore remain relatively modest by international standards. Another criticism of the LPT is that it is a tax on land and buildings, and not a land or site value tax; with many experts viewing the latter as a better taxat least in theoryif the objective is to improve urban development and land use. 14 Notwithstanding such criticisms, there are many good features of the broad-based, low-rate LPT. From a local public finance and funding perspective, the local authorities have rate-setting powers at the margin. With about 1.9 million properties, compliance rates are very high, at over 95% for payment: no doubt due to the multiple payment options offered by Revenue combined with credible sanctions (see next section). Given the difficulty in introducing new taxes and the high visibility of property tax in particular, the outcome achieved is commendable (Turley 2022). For international comparative purposes, Table 6 reports the features of the LPT compared with residential property tax in selected Commonwealth countries.
Although similarities exist, once again it is the differences in design features that are most striking about property tax, not only those between Commonwealth countries but between nations around the world

Discussion and lessons
This section re-examines the 'interesting peculiarities' of the Irish residential property tax, most notably self-assessment and banding, as well as the issues of collection and compliance, and considers which aspects might be adopted elsewhere. It also suggests some additional lessons for other jurisdictions, relating to simplicity, speed and acceptability.

Assessment and valuation
Assessment is considered the most important feature of property tax design. In the Irish case, assessment has two elements that do not conform to the conventional approach. The first is self-assessment rather than the traditional direct assessment by a valuation agency. 15 The second is the use of valuation bands rather than the more usual individual assessment with discrete values. On banding, Kennedy and Walsh (2016, p. 4), note: "It was recognised that property valuation is not an exact science and providing 15 Although self-assessment is not widely used for property tax, it has been adopted in Canada and elsewhere for taxing vacant property (including for Ireland's new Vacant Homes Tax due in 2023). In these cases it is the responsibility of the property owner to declare if a property is vacant, and liable for vacancy tax.

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94 valuation bands eases the valuation challenge." They also note, on the issue of self-assessment, that it "was seen as being more appropriate given the constraints that applied such as the tight timeframe for implementation and the lack of an existing valuation database of residential properties". The arguments for and against self-assessment and valuation bands are presented in Table 7. Banding is used in England, Scotland and Wales for council tax, and self-assessment has been used in some cities in India (with Bangalore as the most cited example), and by municipalities in Colombia, most notably Bogotá (Plimmer et al. 2002;UN-HABITAT 2011;Ahmad et al. 2019). Whereas the British experience of a banded council tax may have influenced Ireland's decision to recommend valuation bands, it is more likely that Revenue's experience with self-reporting for income tax purposes influenced the decision to recommend self-assessment. In theory, banding and self-assessment may be considered second-best solutions compared with the more optimal, common forms of valuation and assessment. Yet the rationale for their selection in the Irish case was clear, given the absence of an up-to-date register of residential properties at the time of design, plus the need to facilitate assessment in a relatively short period, and to increase compliance by making property tax payments generally acceptable to the public. Some ten years on, the issue now is whether these features will be retained as part of a continuing transition, or whether pressure will build to transform them into a more conventional long-term design, and by so doing, address what the OECD (2021, p. 118) describes as "potentially problematic approaches". 16 However, banding is still used for Britain's council tax 30 years after its introduction, although its structure is slightly different from LPT's valuation bands (eight or nine bands as against 20 in the Irish case, and greater variation in intervals). The biggest difference between the two jurisdictions in terms of valuation and banding is that a re-banding has been implemented in Ireland whereas in England and Scotland no general re-banding or revaluation has taken place since the introduction of council tax in CJLG December 2022 95 1991. In Britain this has resulted in out-of-date valuations, likely inequities in residential property tax liabilities across regions and types of dwellings, and, given the time that has elapsed since the last valuation over 30 years ago and the subsequent property price changes, a tax that is now politically more difficult to reform.
As for their appropriateness for other countries, the argument for self-assessment and valuation bands is strongest when a new system is implemented from scratch and a tailored approach is required, rather than a reform of an existing property tax system where many of the more traditional design features are already likely to be in place. Therefore, although unconventional and second best, self-assessment and banding should not be completely dismissed for other countries, but should be considered on a case-bycase basis, and especially for the few remaining Commonwealth countries that currently do not levy a property tax, those whose property tax is in need of reform, or those whose administrative capacity to assess the valuation of residential properties is weak (Franzsen and McCluskey 2005;Collier et al. 2018). Writing over 20 years ago, Plimmer et al. (2002, p. 80) concluded that "value banding for property tax purposes could have a wider application in terms of international usage". Ireland's successful adoption of valuation bands (and the recent re-banding) is an example for others to consider and possibly replicate.

Collection and compliance
In designing the LPT, the Irish authorities prioritised the argument that 'tax administration is tax policy'. 17 While other system features were important, a significant weight was given to tax administration. The decision to focus on the tax administration element was evident in the 2012 Inter-Departmental Group report where six of the 18 recommendations were related to compliance, collection, enforcement and audit. The involvement of the central tax collection agency (Revenue) in the design of the tax, in conjunction with relevant government departments (most particularly Finance and Local Government), combined with the focus on tax administration, collection and enforcement were all evidence of a collection-led rather than valuation-led approach.
An example of this is the multiple payment methods made available to taxpayers aimed at enhancing the convenience of paying taxes (see Table 8). Alongside provision for instalments and other flexible payment arrangements, an unusual option for a property tax is withholding tax at source, integrated into the PAYE (Pay As You Earn) system. This also applies in the case of non-compliance, where Revenue uses its powers to instruct an employer or pension provider to deduct an outstanding LPT liability. 18 Together with Revenue clearance on the sale or transfer of residential properties and the use of the 17 As Kennedy and Walsh (2016, p. 3) write: "… design must take account of implementation issues and implementation needs good design to be effective". 18 For example, approximately 50,000 mandatory deductions from wages/pensions per annum were made in the first three years of the LPT.
CJLG December 2022 96 aforementioned 'Revenue estimate', these features have helped to ensure a very high compliance rate, in excess of 95%. This is notably higher than the equivalent figure for commercial rates, which are collected locally. In this case, the arguments of local knowledge and greater incentives to collect that are usually cited in support of local collection are outweighed by the reputation, powers and economiesof-scale arguments that favour collection centrally.
The decision to assign the administration and collection of the LPT to Revenue was crucial "in gaining the public's acceptance and in ensuring the legitimacy of a new tax on property" (Turley 2022, p. 22).
In the Irish case, the argument for centralisation was strong, not only because of Revenue's involvement in the design of the tax, but also due to its reputation in collection and enforcement. Although the local authorities have not objected to this centralisation of property tax collection, this design feature is an example of a solution tailored to specific circumstances and should not be taken as universally applicable to all countries and suitable for all property taxes. The normal trade-offs involved when deciding in favour of local versus central collection, such as balancing efficiency with local democracy, need to be considered carefully: one size does not fit all in property tax design and administration.
As well as normal debt collection mechanisms (eg use of Revenue sheriffs, powers of seizure, recourse to courts etc), other payment and enforcement sanctions were deployed, including: surcharges, interest and penalties; withholding of tax clearance certificates; and creation of a lien or charge on the property.
Although many of these measures are not unique to Ireland, when combined they make for an administrative system that works well and that other jurisdictions could adopt. The same applies to Revenue's use of online services for taxpayers, not just for payment but also for self-assessing property valuations and filing LPT returns; with, for example, 94% of returns filed online as of May 2022 (Revenue 2022).

Other lessons
McCluskey and Woods (2010)  and (3) make it easy to pay, hard to avoid (Kennedy and Walsh 2016, pp. 14-15). Two further generic lessons from the Republic of Ireland's experience are outlined below.
In property tax, and taxation in general, there is a common preference for a broad-based, low-rate tax regime. A broad tax base combined with a low tax rate is considered optimal in terms of its impact on the economy and the behaviour of taxpayers. These are indeed features of the Irish LPT, where exemptions and deferrals are few (and reduced in the 2021 revaluation) and the basic rate (equal to 0.18% before its reduction to 0.1029% in 2021) is very low by international standards. Although the revenue amounts are relatively small, in the Irish case this can be justified firstly by the limited role of local government and the relatively few public services assigned to and delivered by local authorities in Ireland, and secondly by the need to make the new property tax palatable to property owners and LPT payers. The lesson here for other countries is the appeal of a broad-based, low-rate regime at a rate acceptable to taxpayers (and public representatives), appropriate to the level of expenditure functions assigned to local government, and consistent with local fiscal discipline.
Another reason for the success of Ireland's LPT, and a potential lesson for other jurisdictions reforming property tax, is the simplicity of the system. The LPT is relatively straightforward not only in design, but also in filing and compliance. Although the 2021 revaluation did cause some confusion among taxpayers, the LPT continues to meet the simplicity criteria of any good taxation system, and so helps to ensure high levels of compliance. Related to simplicity is the importance of speed. As evident in Table 4, the time between the publication of the Inter-Departmental Group report and the first LPT payment due was tight, just 12 months, but target dates were met without delay. This was made possible by a number of factors, including both the simple design and the tailored approach. Complexities in property tax systems elsewhere (for example different property classes, differential rates, multiple bases, various reliefs) are generally absent in the LPT, making for a property tax system that taxpayers can understand and tolerate.

Conclusion
When writing about property tax reform, Rosengard (2013, p. 174) noted that "leaders seldom have the opportunity to design property tax with a blank slate". However, Ireland's new residential property tax was an exception. In addition to the opportunity to adopt international best practice in property tax design, the introduction of a new tax rather than the reform of an existing system meant that the usual distributional impacts with the inevitable winners and losers were absentor at least not a constraint that might have stalled the process. As for other trade-offs involved in property tax reform, an emphasis or preference in the Irish case for a revenue mobilisation measure over one aimed at housing activation, for speed over accuracy, for simplicity over sophistication, for collection over valuation, and for voluntary compliance over punitive sanctions, combined to produce a residential property tax that is generally accepted by both politicians and taxpayers.
Acknowledging the importance of the local context when designing a property tax combined with the political economy of property tax reform, Voltaire's 18 th -century quotation, 'La perfection est l'ennemi du bien,' or in English, 'perfection is the enemy of the good,' neatly captures the potential lessons from Ireland's 21 st -century tax design. Although the LPT is not perfect, and has some 'second-best' features, it is now, as Kennedy and Walsh (2016, p. 14) write, "part of the normal business of Revenue and of property owners". 19 Further evidence for this is provided by the 2021 property revaluations, a reform 19 In explaining the success of the LPT (as against the failed attempt to introduce household water charges) and the wider policy-making process, O'Leary (2018, p. 86) describes it as "characterised as lacking in intellectual purity, but […] a process that produced a workable solution". O'Leary (2018) is only one of many reviews of the LPT, details of which can be found in section 7 of Turley (2022).

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99 that countries including Britain and some central European states (Austria, Belgium and Germany, for example) have failed to undertake, at least to date (Slack 2022). Careful consideration of both the economic and political aspects of property tax is necessary for reform to succeed. Ireland's new residential property tax is a good example of this, and provides lessons for other jurisdictions to learn.