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Sinn Féin leader labels Rental Tax Credit a 'half-baked measure' that could 'fuel rent hikes'

Taoieach Micheál Martin said the budget ‘directs resources to those who need it most’.

Sinn Féin leader Mary Lou McDonald during this afternoon's Leaders' Questions.
Sinn Féin leader Mary Lou McDonald during this afternoon's Leaders' Questions.

THE SINN FÉIN leader has claimed that the Rental Tax Credit could “fuel a further rent hike”.

During Leaders’ Questions this afternoon, Mary Lou McDonald accused Taoiseach Micheál Martin of leaving “the door wide open for more rent hikes, more exploitation, and more hardship”.

She added: “Taoiseach, you have messed this up, and the renters of Ireland deserve more than this half-baked measure. So I want you to correct it.”

McDonald called on the government to “give renters a real break by putting a month’s rent back into their pockets through a refundable tax credit” and “provide certainty and protection by banning rent increases for three years”.

However, Martin noted that “there is a 2% limit on the rent pressure zones as we speak”.  

Rental Tax Credit

A new tax credit for renters was one of the measures introduced in yesterday’s €11 billion budget.

It’s worth €500 per calendar year and will apply for 2022, and can be claimed until 2025.

Around 400,000 people will be eligible for the tax credit, which will cost the Exchequer around €200 million.

Finance Minister Paschal Donohoe confirmed yesterday that landlords must be registered with the Residential Tenancies Board in order for tenants to avail of the tax credit.

Landlords are required by law to register their tenancy but this isn’t always done, as was the case with numerous TDs who rented out properties.

The Sinn Féin leader said it “won’t make a dent for people paying average rents of over €2,000 per month in Dublin, or those paying nearly €1,500 a month across the state”.

McDonald also claimed that the Taoiseach previously said that a Rental Tax Credit “would be inflationary and would add to rent prices”. 

She added that because the Rental Tax Credit is non-refundable, it has “left out students and low income workers”.

However, the Taoiseach said the budget had to be “viewed in its entirety” and that the government is “helping the most vulnerable in our society”.

He also pointed to “very strong supports for students” that were enacted in yesterday’s budget, which includes a once-off €1,000 reduction in student contribution for eligible students and a once-off double payment of the Susi maintenance grant.

Martin noted that the Fiscal Advisory Council “described Budget 2023 as sensible, and said that government has managed to direct resources to those who need it most”.

Martin said that the figures in Sinn Féin’s alternative housing budget “don’t add up” and would leave a “€300 million black hole”.

‘Housing disaster’

Mary Lou McDonald responded by claiming that a “housing crisis has morphed into a housing disaster” under Martin’s time in office as Taoiseach.

She called on the Taoiseach to “correct” the housing budget and pointed to “three design errors”.

McDonald said: “€500 is not enough when you are facing the types of rents that people are paying. The tax credit is not refundable and that means students and low income workers are excluded.

“And crucially, for this to work, there has to be a ban on rent increases for three years.”

However, Martin said her proposals “would drive more houses out of the housing market”.

He said: “Every year, less people are renting out houses and the ban would have a detrimental effect on this.”

He added that McDonald “needs to get real in terms of the market” and claimed that “people don’t want to let out houses anymore because of the endless vilification that people like Deputy (Eoin) O’Broin fire upon people on an on-going basis”.

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