Mr. Hubert Fitzpatrick:

The Kenny report was published in 1973, some 50 years ago. At that time, there was no stamp duty, no capital gains tax, no Part V and no development levies. The environment today is totally different from where we were in 1973, and it is somewhat out of date to keep referring to a report that is now 50 years old.

I might give one or two examples of adequate land sharing measures that are there at the moment. Development levies, under section 48, were introduced around 2003. Prior to that, the connection levy payable to local authorities was very small and related to the cost of making that connection for services. Section 48 development levies were brought in to fund infrastructure that could be delivered anywhere in the local authority area. If somebody were paying development levies in Drogheda, County Louth, for instance, that could fund infrastructure in Ardee. That is a form of land value sharing.

I will give a typical example, although figures can be very subjective. The value of 1 acre of agricultural land might be €10,000. If the land might be owned at 15 units to the acre and planning permission is then secured, it might suddenly be worth €300,000 an acre. If we say, conservatively, that the section 48 development levy was worth €7,500 and an Irish Water levy was worth €7,500, that would equate to €15,000. That acre of land would generate €225,000 to fund public infrastructure, which would equate to 75% of the enhanced value of the land. The very same could be done if the land value were to increase to €500,000. In that case, we would end up with a 45% tax.

We need to sit back and look at the detail of this in concrete examples. More than adequate land value sharing mechanisms are in place at the moment, and the vast bulk of all the development levies paid in respect of any buildings being built today is being spent to fund public infrastructure elsewhere within the local authority area.

We are all familiar with the schedule of public infrastructure works that local authorities prepare under the section 48 development contribution scheme. I have not referred to section 49 development contribution schemes where special further levies apply. We need to make sure we do not kill the goose that lays the golden egg here because we also have to add in the 20% provided for under Part V. We will find that a zoning tax such as the one proposed will actually devalue agricultural land because the industry will not be able to bear this. It will have unintended consequences.

The Government has brought a lot of initiatives to the table over the past 18 months and we have to give those initiatives time to deliver. We need certainty within the industry going forward to ensure the investment climate is right and that funders are coming in place and are happy to fund. Bringing more uncertainty to the market through new initiatives will detract from future housing supply.

We would welcome the opportunity to share further examples with the committee regarding current land value sharing mechanisms that are in place. When we weight up all of these initiatives my position is that we already have a high land value sharing tax applicable to the industry from which the public benefits.