Pearse Doherty (Donegal, Sinn Fein) | Oireachtas source

I move amendment No. 109:

In page 132, between lines 8 and 9, to insert the following:

“Report on applying a stamp duty surcharge on the purchase of residential property by corporate structures including REIT and IREF

61.The Minister shall, within six months of the passing of this Act, prepare and lay before Dáil Éireann a report on the application of 17 per cent stamp duty surcharge on the purchase of all residential property by corporate structures including REIT and IREF, including structures which derive over 50 per cent of their value from residential property for investment and/or letting purpose, upon the sale of their shares.”

These amendments concern the application of stamp duty. The first concerns the application of a 17% duty surcharge on bulk purchases of all residential property by institutional investment funds, including the bulk purchase of apartments. The second amendment concerns the application of stamp duty surcharge on the purchase of residential property by non-residents. The third amendment concerns the increase in the rate of stamp duty in the commercial property sector.

With regard to the first amendment, and consistent with earlier discussions, we in Sinn Féin are of the view and have argued for some time that a stamp duty surcharge should apply to the purchase of all residential property of investment funds without exception. This amendment will also allow for an assessment of the success or, indeed, failure of the stamp duty measures the Minister introduced in May, with a rate which is too low.

The second amendment calls for an examination of a stamp duty surcharge on the purchase of residential property by non-residents. This was examined in the tax strategy group papers. In the North, a 2% surcharge on acquisitions by non-residents came into effect on 1 April 2021. The stated objective of this surcharge is to help control house price inflation and support residents to get onto and move up the housing ladder. We propose such a measure be examined in the pursuit of a similar objective here on this part of the island.

The third amendment is to examine the increase in the rate of stamp duty in the commercial property sector. Sinn Féin has proposed an increase to 12.5% in the context of budget 2022. This would have an advantage of dampening activity in the market and directing labour resources towards the residential housing sector, where it is most needed. Furthermore, it could review the impact of Covid-19 and the move to remote working on this tax head. As noted in its tax strategy group paper, the Department believes the rebound in commercial property activity and occupancy this year may be more of a reflection of how low demand was during the height of the pandemic and long term, it anticipates lower office demand than pre-Covid levels, due to the implementation of a more permanent remote hybrid working policy.

These three amendments all concern property and stamp duty. The second one is a mirror of what is happening on another part of our island. The application of the 17% on investment funds would apply to all homes, including apartments, and the amendment is about rediverting resources away from commercial property and into house building.