Tuesday 17 October 2017

Bring in vacant site tax now - we can't wait until 2019, Donohoe to be warned

ESRI’s Kieran McQuinn urged bringing the tax forward. Photo: Frank McGrath
ESRI’s Kieran McQuinn urged bringing the tax forward. Photo: Frank McGrath
Cormac McQuinn

Cormac McQuinn

The early introduction of a vacant site tax to encourage builders to use development land is set to be tabled by a powerful Dáil committee as Budget talks enter their final week.

The Budgetary Oversight Committee will make a series of recommendations to Finance Minister Paschal Donohoe within days, with housing measures high on their list of priorities.

Although the Government has plans to introduce a levy on derelict vacant land from January 2019, a draft of the committee's report urges Mr Donohoe to consider bringing it in earlier as part of Budget 2018.

Amid the ongoing housing crisis, such a levy is seen as key in preventing developers from hoarding land and the committee heard from experts that said it should be brought in sooner.

The committee's pre-Budget report is due to be published before the end of the week.

A draft document, seen by the Irish Independent, notes that "all stakeholders were supportive of the early introduction of a vacant site tax".

It adds that the committee "recommends that the minister gives consideration to the early introduction as part of Budget 2018."

It also suggests there should be "higher rates on sites that can be easily built on and have the necessary infrastructure in place".

The Economic and Social Research Institute (ESRI) was among those arguing for the introduction of a site tax during the committee's public hearings.

The ESRI's Dr Kieran McQuinn noted it would be "quite a period of time" before the levy was introduced in 2019 and added: "We would heartily agree with any way it could be fast-tracked."

The committee will meet in private tomorrow as it continues to thrash out its report's recommendations.

Separately Fianna Fáil's housing spokesman Barry Cowen released figures that he said showed "the extent of hoarding of residential land, which is greatly exacerbating the housing crisis".

The numbers, provided by Nama, shows that the agency sold land that has capacity for more than 50,000 houses or apartments, but just 3,670 are under construction.

"The Government's Vacant Site Levy, which will not take effect until January 2019, is nowhere near strong enough to discourage land hoarding in a growing market," he said.

Irish Independent

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