Readers like you keep news free for everyone.

More than 5,000 readers have already pitched in to keep free access to The Journal.

For the price of one cup of coffee each week you can help keep paywalls away.

Support us today
Not now
Advertisement

New zoned land tax branded a 'total joke' by opposition TDs

The tax was announced by Finance Minister Paschal Donohoe this afternoon and will replace the vacant sites levy.

Housing Minister Darragh O'Brien
Housing Minister Darragh O'Brien
Image: Sasko Lazarov

THE OPPOSITION HAS criticised the Government’s proposed “zoned land tax” announced today as part of Budget 2022. 

The Government is to introduce the tax in order to encourage the use of land for building homes, however People Before Profit TD Richard Boyd Barrett has branded the levy “a total joke”. 

The tax, which will be administered by Revenue, was announced by Finance Minister Paschal Donohoe this afternoon and will replace the vacant sites tax. 

Announcing the measure, the Finance Minister said housing is “the core challenge facing the country over the next number of years”.

He said he appreciates the strain, anxiety and worry being caused by the shortage of homes.

The “zoned land tax” will be introduced to “encourage the use of land for building homes,” he said.

“The tax will apply to land which is zoned suitable for residential development and is serviced, but has not been developed for housing. It will therefore target land in areas which are zoned residential or which are zoned for a mix of uses, including residential.”

Donohoe said that prior to the tax coming into effect maps will be drawn up by local authorities.

There will also be a lead-in times for this tax, which prompted jeers from the Opposition benches in the Dáil chamber this afternoon. 

“I am proposing a two-year lead-in time for land zoned before January 2022, and a three-year lead in time for land zoned after January 2022,” he says. “This will also give scope to review the workings of the tax, to listen to stakeholders, and ensure it is both effective and equitable.

“The tax will be based on the market value of the land and I have determined that the rate at the outset should be 3%. This aligns with the starting point for the vacant site levy when it was first introduced.”

Reacting to the announcement, Boyd Barrett criticised the lead-in times for the tax coming into effect and the fact that the new tax is 4% less than the vacant sites levy which it will replace. 

“This is worse than useless compared to the radical action needed to unlock sites in hands if speculators,” he said. 

Sinn Féin’s Housing spokesperson Eoin O’Broin said: “Yet again the Government has given a boost to land hoarders. 

“The rate will be just 3%, well below the rate of land value inflation in high demand areas. This is yet another example of a Government not serious about the causes of the housing crisis. 

“Once again the interests of large landowners and developers are being put before working people in need of affordable homes,” said O’Broin. 

Help-to-Buy

As part of Budget 2022, Donohoe also announced that the Help-To-Buy scheme will be extended beyond December 2021 into next year.

He also proposed that the relief for pre-letting expenses for landlords for a further three years, which he says will “continue to encourage landlords in the residential rental sector to return empty properties to the market as quickly as possible”.

Making a difference

A mix of advertising and supporting contributions helps keep paywalls away from valuable information like this article.

Over 5,000 readers like you have already stepped up and support us with a monthly payment or a once-off donation.

For the price of one cup of coffee each week you can make sure we can keep reliable, meaningful news open to everyone regardless of their ability to pay.

The Housing for All investment of €4 billion will include the largest capital budget of €2.6 billion.

Funding for homeless services will be €194 million, and there will be an increase in Traveller Specific Accommodation Schemes to €18 million. There will be increased funding for housing adaptation grants from €60m to €65m and retrofitting will also increase by €20 million to €85 million.

Speaking in the Dáil this afternoon Donohoe said that the Government is conscious of the cost of living pressures faced by people.

He says his Department is forecasting that debt will come in at just under €240 billion next year.

Modified domestic demand grew by almost 8.5% in the second quarter this year, surpassing the level immediately preceding the pandemic for the first time since the crisis.

He says it is expected to grow 5.25% and 6.5% in 2022.

By the end of the year the unemployment rate is forecast to be just over 9%.

Donohoe said that employment is forecast to grow by just under 8% or around 150,000 jobs this year.

He says that next year, the unemployment rate is expected to fall to around 6.5% by the fourth quarter, adding that employment is expected to grow by just over 13% or 275,000 jobs in 2022.

About the author:

Read next:

COMMENTS (8)

This is YOUR comments community. Stay civil, stay constructive, stay on topic. Please familiarise yourself with our comments policy here before taking part.
write a comment

    Leave a commentcancel