Broad tax reliefs for developers did “such harm” to the Irish economy and should not be reintroduced, the Minister for Finance has said.
Paschal Donohoe said such tax reliefs harmed housing delivery in Ireland for many years.
He said: “We should not bring in and reintroduce the reliefs that proved so costly and did such harm a number of years ago.
“We need instead to be delivering policy stability, and we need to have a stable tax and policy framework within which those who are building more homes can operate – and reintroduction of those reliefs is not a way in which we will do it.”
In particular he said Section 23 relief, which allowed companies or individuals to get a tax break on certain rental properties, proved to be “very, very costly”.
The Minister told reporters in Brussels: “From a taxation perspective, we have many plans in place that are seen to work and are seen to play a positive role: Help to Buy, the Shared Home Equity Scheme, the work that we are doing under zoned land tax are all very positive interventions that I believe play a good role in allowing more homes to be built.
“I will continue to work on those kind of ideas to see what role they can play.
“However, what I’m not going to do is reintroduce or propose the very tax reliefs that did such harm to our economy and then the building of homes for many years in Ireland.”
He said that it is “very difficult” to identify how policies like Section 23 relief could be targeted and added: “I don’t believe those policies are the ways in which we will make progress in the delivery of more homes.”
Mr Donohoe said there are “alternative ways” to meet the goal of increased housing delivery, adding that there were many possible policy changes that could be considered.
“It’s clear that we need to do more with regard to infrastructure. It’s clear that we need to be better able to meet the energy and water needs of those who are building homes.
“And it’s also increasingly clear to me that we need to reconsider the availability of planning permissions and the availability of land upon which homes can be built.”
