Pearse Doherty (Donegal, Sinn Fein) | Oireachtas source

The Minister made changes in last year's Finance Bill in regard to this structure because it was going to get away with paying no stamp duty on a €1.3 billion sale of residential or non-residential property. As I said, 1% is better than nothing but the stamp duty on non-residential property is not 1%, it is 7.5%. This is not an entity that is engaged in selling shares. It is not a company that is involved in research and development, R&D, or manufacturing and the company is being sold through its shares. This is an entity structured in a way that allows it to purchase and develop property in the State.

REITs and IREFs do nothing else. Therefore, when they sell their shares, they are selling the apartment blocks, shopping centres and other commercial entities. They are able to do so in a way that is not envisaged. It was never envisaged that they could sell commercial property at a 1% rate. This was a loophole that was exploited by Green REIT. The Minister has talked about keeping it under review. However, he knows what the issue is, and he is willing to let it go, which is not acceptable.

I am conscious that this amendment is also grouped with amendment No. 148. I will speak to that amendment now. It asks the Minister to lay before the House a report on the introduction of a residential property tax surcharge where property is purchased by a non-resident. The Minister will know, because his tax strategy papers also discuss this issue, that a 2% stamp duty surcharge on non-residents purchasing residential property will be introduced in the North and in Britain from 1 April 2021. The objective of that policy is to try to control price inflation, which is nothing like what we have seen here in recent years. The intention is also to support residents in attaining home ownership.

Sinn Féin's amendment is about doing as other jurisdictions are starting to do so that a non-resident purchasing residential property through one of these structures would pay additional tax by way of a surcharge. Britain has decided to impose a 2% stamp duty surcharge. Here, never mind a surcharge, the Minister does not even want them to pay 2% and wants them to pay as little as 1%. These are the types of policies we need to look at. There is a serious issue with non-residential investors disturbing the market and pushing up prices as a result. Calling for these two reports is a mechanism to allow us to table amendments.

I strongly argue that the Minister should not allow REITs to get away with paying 1% stamp duty when every other company that sells or disposes of commercial property in the State is required to pay 7.5%. What is so special about these REITs? Why does Fine Gael think they are so special above every other structure? These are multibillion euro structures and not wee companies. They are not corner shops, but multibillion euro companies that are able to pay a fraction of what others would have to pay on disposal of non-commercial property.