Z
z106
Guest
Just heard this as a headline on the news as a recommendation to the government.
Does anyone kniow the ins and outs of this one?
Does anyone kniow the ins and outs of this one?
It might be political dynamite, but so will any decisions to cut the health/education budgets or raise taxes next year to cover the budget deficit.
If it only applied to the value of a property in excess of say €500k and to investment porperties it would take the sting out of it for most ordinary workers.
Ireland already has among the lowest property taxes in the world, and it would be less of a drain on enterprise and competitiveness than most other solutions to our problems.
Makes a big change from section 23, doesn't it?
If it only applied to the value of a property in excess of say €500k and to investment porperties it would take the sting out of it for most ordinary workers.
Ireland already has among the lowest property taxes in the world, and it would be less of a drain on enterprise and competitiveness than most other solutions to our problems.
Makes a big change from section 23, doesn't it?
ubiquitous
Registered User
- Messages
- 3,782
Like the proposal to curtail the minimum wage, this would have been a good idea in order to dampen the economy 7 or 8 years ago but at this stage in the cycle it would be counter-productive, unjust and impractical.
ButtermilkJa
Registered User
- Messages
- 660
I agree, these measures would have been great to help create a stable economy when the boom times kicked-off but would be worthless and counter-productive now when the economy is in nose-dive and everyone is stretched as it is.
Typical. Why is it always the clever people looking on from outside while we leave the idiots run the country
Tax take in this context could (presumably more easily) be increased by rolling back on stuff like allowing certain expenses (including 100% of mortgage interest) against rental income? Not saying that this would be a good idea (I have no idea to be honest) but just mentioning it.
ButtermilkJa
Registered User
- Messages
- 660
Yes it would. Many people suggested years ago that they should increase the SD on investors and those buying second or holiday homes, and reduce it for FTB. This would have made homes affordable for FTB and more restrictive for investors/speculators and so we would not have had the crazy bubble (and now crash) that has all but destroyed the good times we had.
But like I said, they didn't listen then and now they want to apply new rules to the game when it's over. Really amazes me what goes on in these peoples heads.
ubiquitous
Registered User
- Messages
- 3,782
The Bacon report of 1998 proposed similar measures designed to screw investors in the hope that owner-occupiers would gain correspondingly. The govt implemented these measures. They were a disaster, leading to a shortage of rental properties and sharp increases in rents (which, surprise surprise led to big wage demands on employers). They were abolished in Dec 2001 and within months there was a fall in rents.
The last thing we need now is another bubble in the rental market.
What is so unjust about applying a tax on vacant properties or those with holiday homes? Vacant properties especially are a gross misallocation of resources and should be discouraged by the government.
I wouldn't agree with this. The budget deficit will have to be made up somehow:
1. It wouldn't be as counterproductive as raising income tax or cutting investment in education/infrastructure since it will have much less direct effect on our competitiveness.
2. Unfair in my view would be paying for it through cutbacks which would affect the most vunerable in our society, or through tax hikes which will place the burden on production & enterprise. As Vincent Browne says on his show almost nightly, why should those who benefitted most from the boom not pay to get us out of the bust?
3. While there might be practical difficulties in valuing houses, many other countries levy property taxes, as we had here until those affected (the well off) lobbied to have then scrapped.
ubiquitous
Registered User
- Messages
- 3,782
Vincent Browne as usual is talking through his behind. The people who now face negative equity as a result of being suckered into buying property at inflated prices during the past 5-6 years, were not "those who benefitted most from the boom". They were the ones who paid dearly for the boom, basically lining the pockets of others - the generation game as David McWilliams called it.
Applying taxes on vacant properties or holiday homes is imho a fair policy in normal circumstances but would have disastrous effects if done now. Whatever limited liquidity and confidence remaining in the property market would disappear overnight, leading to widespread bankruptcies and possibly a crisis among our banks.
Applying taxes on vacant properties or holiday homes is imho a fair policy in normal circumstances but would have disastrous effects if done now. Whatever limited liquidity and confidence remaining in the property market would disappear overnight, leading to widespread bankruptcies and possibly a crisis among our banks.
elefantfresh
Registered User
- Messages
- 450
If this comes in does that mean only for new purchases? I paid my SD already so they're not going to hassle me for more money now every year are they?
ButtermilkJa
Registered User
- Messages
- 660
I agree with that in general. We don't want to 'screw' investors as they are needed to supply rental properties in all economies regardless. What I would like to see however, are measures brought in that make it difficult or expensive for speculators to buy and flip properties short-term, therefore inflating prices for everyone. Taxing these people heavily would be a good move.
It may not be the answer we're looking for to make up the shortfall in taxes, as most likely it will deter speculators, but at least it might control radical fluctuations in property prices next time the boom comes around. Better have these policies in place now rather than waiting until we're in the thick of it again.
ubiquitous
Registered User
- Messages
- 3,782
Of course they will. The whole idea of the property tax, as espoused by Rory O'Donnell of the ERSI on radio this morning, is to spread the tax burden over all properties. The problem they see is that stamp duty is only collected on new purchases, a very small subset of the entire sector.
Effectively those who bought recently will be double-taxed. Hence the injustice.
ButtermilkJa
Registered User
- Messages
- 660
Well, the latest from the Government is that they don't see this as being a viable solution. However, if it did come in I would imagine there would be some kind of equalisation for those who have already paid heavily.
This issue could be resolved by exempting the first €500k from the tax and placing other safeguards in to deal with any inequities that arise - these issues shouldn't distract from whether a property tax is a justified revenue generator in principle.
No one likes paying more taxes, but our deficit is looking like rising towards €5bn next year and money will have to be got from somewhere. The key question for me is whether a property tax is preferable to income tax hikes/expenditure cuts which will do more to harm our competitiveness and prolong the recession.
We need to get beyond worrying about whether it will damage the property market and recognise that it was the property market which damaged our economy in the first place.
M
mercman
Guest
Vacant properties especially are a gross misallocation of resources and should be discouraged by the government.
This is a ridiculous statement. Communism is dead and uried
If a person wishes to purchase a property and leave it empty so be it. The idea of a property Tax for Investment properties seems like a good idea and should have been introduced years ago. If an Investment property can be afforded then an Investment Tax of 0.75% should be imposed across the board, including Land which is not farmed.
This is a ridiculous statement. Communism is dead and uried
If a person wishes to purchase a property and leave it empty so be it. The idea of a property Tax for Investment properties seems like a good idea and should have been introduced years ago. If an Investment property can be afforded then an Investment Tax of 0.75% should be imposed across the board, including Land which is not farmed.