Mr. John Hogan:

I thank Deputy Ryan for his comments. As regards his first point on what he discussed earlier today with the Taoiseach, the Minister has this afternoon issued a press release announcing a review of the local property tax, LPT. Today he briefed his Government colleagues on the approach the Department will be advancing during 2018. The review will include a consultation process to enable all interested parties and individuals to submit their views on the future of LPT. It will start in February and will, in particular, consider the impact on LPT liabilities of properly priced developments. It will include an examination of the outstanding recommendations of the 2015 Thornhill report and will be conducted by a cross-departmental group chaired by this Department and comprising officials from Revenue Commissioners and the Departments of Public Expenditure and Reform and Housing, Planning and Local Government. It is expected that it will be completed by the end of August and the group will provide several policy options for consideration by the Minister.

The purpose of the review will be to inform the Minister of any actions he may recommend to Government concerning the overall yield from LPT and its contribution to total tax revenue. As I said in my opening address, the review will be informed by the desirability of achieving relative stability over the short and longer terms on LPT payments of liable persons. It will kick off in February and move on from there.

As regards the issue of site value tax, Deputy Ryan can appreciate that it was considered at some length in the original Thornhill report of 2012, which considered the issue of the market value tax that was ultimately opted for versus site value tax and the options and opportunities in that regard. It was concluded that site value tax did not stand up to the rigorous scrutiny across several parameters or indicators by which a property tax would be introduced in the same manner that market value tax did. The Deputy is correct that along with the Thornhill report there were previous explorations of the potential for a property tax by both commissions of taxation that looked at the approach and rejected the idea of a site value tax. When the Thornhill report considered the options or the development of property taxes in other countries, it found that site value tax was not as common as one might have expected.

For all those reasons, it was rejected. The challenge in this regard now relates to whether we go over ground which we have already covered and which was considered quite extensively in the original Thornhill report. While any movement in that direction would, quite correctly, be a decision for the Minister, we need to be careful that we are not starting from zero again and that the work on this particular methodology of introducing LPT would not be repeated.