Michael McGrath (Cork South Central, Fianna Fail) | Oireachtas source

How many Ministers even have a mortgage on the family home?

The Minister said the exemptions are largely based on the exemptions to the household charge, which are exceptionally narrow in nature. The Minister failed to point out, however, that those on mortgage interest supplement, who were exempted from the household charge, are not being exempted from the property tax. Around 16,000 of the lowest income families in the country, who cannot pay their mortgage without the assistance of the State, are now being required to pay this property tax. It makes a mockery of the lip service paid by the Government to addressing the mortgage arrears crisis.

All of that is without even mentioning the buy to let mortgage book, which is in a complete mess, as the Minister well knows.

We know that three out of ten of them are in arrears of 90 days or more. They will need to pay the non-principal private residence charge next year but the NPPR will then be abolished from 2014 onwards.

A report by Davy estimates that half of family home mortgages are in negative equity at this point. That is at least 400,000 family home mortgages where the value of the mortgage is greater than the value of the property. How is it fair to impose a tax on a net liability, which is what these families have? It is wrong to suggest that negative equity is not a problem so long as the family can continue to service the mortgage. It is a real trap for people and is deeply unfair to impose a property tax without taking any account of the value of the mortgage vis-à-visthe value of the house. The budget is doing nothing for those people.

Approximately 160,000 people paid at least €10,000 on stamp duty over the past ten years and many of them had to borrow that money. They are repaying that money every month in their mortgage repayment and as they see it they are already paying their property tax. In addition there are people in rural areas - the Taoiseach will know this well - who have paid up to €15,000 to local authorities in respect of development contributions to build a one-off house in the countryside.

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