Eamon Ryan (Dublin Bay South, Green Party)
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I thank the Chair for allowing me to speak now because I am due to attend a meeting of the Joint Committee on Communications, Climate Action and Environment which will shortly begin. I very much welcome this discussion, which is a good example of the work this committee can do.

I asked the Taoiseach earlier today about the Government's approach on this issue. Perhaps the officials could inform me further in that regard. The Taoiseach informed me that the Minister for Finance was to today launch a proposal or reflect on a paper that went to Cabinet today. In the absence of the Minister, perhaps the officials could give members some indication of what that involves. I very much see this as an opportunity.

One of the areas on which I want to focus is the possibility of a switch from the current model of local property tax towards a site value form of property tax, which I believe would bring a variety of benefits to the country. Is that being considered as part of the review that is taking place? I will briefly outline why it makes sense. Central to the national planning framework is the conviction that we have to start bringing development back to the centre of our communities, make efficient use of our land and stop the ongoing sprawl of cities in our country which has huge cost to the State in terms of transport, health, education and other services.

One of the main benefits of a site value tax is it gives a great kick towards more sustainable, concentrated development. Second, in the absence of any other measures to get back the value that the State often applies in terms of the building of infrastructure and so on, it provides a mechanism whereby that value would not necessarily accrue to the private landowner but, rather, would be a public value, which could come from rezoning, investment in the public transport system or the building of a school, that would have a real effect in terms of increasing property and land values. A site value tax would be a very effective way of capturing some of that value. It is a method used in Denmark, Australia, parts of America and other locations. We are not looking for something untested or out of the ordinary. In my experience, it has always been opposed by the Department of Finance because of the belief that we do not know who owns what land.

In 2009, the tax commission set out some of those difficulties, as well as difficulties in terms of how to assess the site value. However, my understanding is that in the interim we have built up a better register of land ownership and there are new mechanisms involving computerised data and indexes of property transactions. The work done by Ronan Lyons in Trinity College Dublin shows that there are ways in which such valuation schemes could be introduced at low cost. There is a gain to the State in terms of the incentive towards a better form of housing development and also a better form of local government revenue. I would like site value tax to apply to commercial land as well as residential land, thus replacing the rates system. It would bring huge benefits. It is not an issue of Dublin versus the rest of the country. The level of tax would not necessarily vary, although research would be needed in terms of what people in Dublin would pay compared to those elsewhere in the country. However it would begin stopping the unsustainable use of land in our country by putting absolutely valid and correct constraints on landowners. I am very interested to know whether the witnesses or other departmental officials are considering that as part of the review.