Fianna Fáil tax-incentive plan for house building criticised

Some experts have criticised Fianna Fáil's plans to give developers tax breaks, saying it would not solve the housing crisis.

Fianna Fáil has suggested that VAT should be cut to 9% for three years and development levies should be reduced to encourage more building.

A repair and lease scheme for vacant units introduced last year has only seen an uptake of seven out of a target of 800.

However, some experts say that it is site prices rather than construction costs that are driving up house prices.

Architect Mel Reynolds says reducing VAT will only make matters worse.

"The danger with using the crisis as a Trojan horse, in a way, if industry does this, when you get a blanket incentive like a VAT reduction applied to the entire country, not only does the scheme in Galway improve in terms of profitability, but your land value in Dublin for your land-hoarders increases by about 25%," he said.

KEYWORDS: housing


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