Dublin homeowners, the State’s biggest payers of local property tax, will

have their bills cut next year, following the decision of councillors in three local authorities to lower the tax by 15 per cent.

Dublin city councillors last night voted for the cut, despite warnings from chief executive Owen Keegan that the decision could hit homeless services.

South Dublin County Council also voted yesterday to reduce next year’s local property tax rate by 15 per cent.

Dún Laoghaire-Rathdown County Council voted unanimously last night to reduce the tax by 15 per cent. Fingal Council Council meets today.

The 15 per cent cut means a house valued in May 2013 at €325,000, with a property tax liability of €585, will incur €497.25 next year.

Councillors in all 31 local authorities across the State have the right to vary local property tax by up to 15 per cent from next year. Local authorities have one more week, until September 30th, to advise Revenue of the adjustment they intend to apply, if any.

Next year each city or county council will retain 80 per cent of the tax collected in its area, with 20 per cent going to a central fund to be shared nationally. Reductions agreed by councillors apply only to the portion held by the local authority; the cash going into the central pot stays the same.

If Dublin city councillors had not changed the rate, the council would have got €63.5 million; with the 15 per cent reduction the council will get €51.1 million.

Mr Keegan had urged councillors not to implement a 15 per cent cut, because of a lack of clarity over Government funding of homeless services next year.

In a report to councillors, Mr Keegan said, despite requests, the Department of the Environment had not given sufficient clarity on its plans to fund housing, roads and homeless services, for councillors to know what funds would be available for the city in 2015.

“Due caution must be applied to reflect the lack of specific data,” he said, adding the council required €45.3 million from Government to fund homeless services in 2015.

However, Mr Keegan said rising property prices in the city, already up by almost 22 per cent in the year to June 2014, were likely to result in a “sharp increase” in the tax value when properties were reassessed in November 2016. He had recommended the councillors reduce the tax by 5 per cent each year for the next three years; a €4.1 million loss in tax yield each year. Yet the vast majority of councillors, 46, voted for the 15 per cent cut, with just 12 against.

Green Party councillor Ciarán Cuffe was the only councillor to speak in favour of Mr Keegan’s proposal, saying reducing the rate by 15 per cent was “auction politics at its worst”.

Meanwhile, Cork County Council has voted to reduce its property tax by 10 per cent which will see the council return €4.2 million to householders from its €42 million property tax fund.

Fianna Fáil proposed the 10 per cent cut, Sinn Féin tabled an amendment seeking a 15 per cent cut but this was rejected, as was a Fine Gael motion proposing no cut. Councillors voted by 36-16 in favour of the original 10 per cent cut proposed by Fianna Fáil with Sinn Féin joining with Fianna Fáil, Labour and some Independents to pass the motion.

Kerry and Galway county councils both voted not to reduce the tax.