Dr. Ronan Lyons:

I am grateful to Deputy Ellis for reminding me about idle shops. I had noted and forgot to mention the issue. Part of the reason is that until very recently there was a rebate on commercial rates for leaving something empty. I understand local authorities now have the option to reduce the rebate. It is the exact opposite of what we want the tax system to do. We want the tax system to punish, rather than reward, vacancy. For me, the obvious answer is a land tax., which would replace commercial rates and apply to publicly and privately owned buildings and land. The same would apply whether the property was occupied. It is in people's interests if they own sites or buildings to ensure they are used. That is also the primary tool I would use to lower vacancy rates, whether it be the same land tax or a reformed local property tax.

I understand, from a legal perspective, that taxation of assets on the grounds of nature of use is slippery. We may end up in the Supreme Court on that point. Giving per person tax credits is straightforward. We already do it for income tax. A property tax which was much higher on paper, but was actually the same tax for a standard family based on the occupancy or nature of the house, would, de facto, punish people. People would have to apply for tax credits that lowered their property tax bill if they lived in a property. If nobody lived in a property, the owners would face a much higher property tax bill. That would be a way of getting around some of the legal issues. It is the most important stick. People respond to financial questions.