Simon Harris (Wicklow, Fine Gael)
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I agree with much of what Deputy McGrath has said. He is right to ask how this provision will ensure that land is actually utilised and not left idle. In response, I refer him to the Minister's speech on budget day where he indicated that he plans to launch a public consultation process shortly on the issue of incentivising the use of currently unused land. This will relate to land zoned and serviced for residential development. The aim of the consultation is to assess the extent to which the taxation system can be utilised to encourage the development of such zoned and serviced land to assist with the shortage of residential properties in certain areas, of which we are all well aware. Any existing levies will be considered as part of that consultation and any taxation measures which may be introduced as a result of the consultation will take account of any levies currently in place. The issue of how to utilise unused land is one that the Minister is eager to engage with and he will launch a consultation process shortly in that regard. It is a problem that the Government is acutely aware of at present.

Regarding Deputy Doherty's point about replacing one set of tax provisions which are having a distorting effect with another set of provisions, the Minister for Finance is of the view that if one does so, one runs the risk of continuing to distort the market. He is also concerned that one would effectively shoe horn transactions into a set period. I know I am not directly addressing the section but rather the suggestion made by the Deputy in his contribution. The Minister was very clear on budget day and on a number of occasions subsequently that this provision will be kept under very close review. If it is found that transactions and the sale of land for development are leading to abuse or to increased costs of development, particularly in the area of housing, the Minister will not hesitate to introduce whatever measures are open to him and the Government in order to correct the situation.

The Minister gave consideration to replacing the windfall tax provisions with a higher single rate of capital gains tax above the current rate of 33% on any profits or gains from land disposals attributable to increases in land value above the non-developed or agricultural-use value. However, the Minister was concerned that, as with Deputy Doherty's suggestion, that could have a distorting effect on the market. We will keep this under close review. I note the words of caution expressed by Deputy Doherty and the comments of Deputy McGrath on the issue of unused land.