Mick Wallace (Wexford, Independent) | Oireachtas source

I get the point that the Minister makes but I take a different position. I find it incredible that we have allowed this to go on for so long. I had a debate with the former Minister for Finance in this House on 16 January 2014. I said to him:

The Government might view real estate investment trusts, REITs, as a quick fix measure to get rid of properties on the books of ... NAMA and the banks, but questions must be asked about the increased corporatisation of property, with little financial gain for the State. REITs are not taxed on their rental income as long as they pay 85% of it to shareholders as a dividend. [There is different corporation tax] as long as their income relates to rental income and non-resident investors are also exempt from Irish capital gains tax. There must surely be implications for the rental market in the years ahead.

That was nearly four years ago. The Minister responded to me with some points: "My officials will be monitoring the uptake of REITs in the Irish property market, but it is not expected that REIT ownership of property will reach the level of concentration at which a distortion of competition in the market may occur." He went on to say:

I also wish to highlight to the Deputy that potential benefits for property tenants were a motivating factor in the introduction of the REIT framework last year. REITs are specifically designed for the long-term holding of income-producing property.

Then he said: “It is hoped that the introduction of this type of professional property management into the Irish market will, in the long term, help to standardise and improve management standards across the rental property sector as a whole, which would be of benefit to both investors and tenants.”

That was four years ago. I do not understand, when we saw that this was going off the Richter scale, that the Government did not act earlier and deal with what was a licence to print money. It had incredible potential to distort the property market, which it did, and especially the rental market. We sat idly by. The Minister is making a change now, and that is to be welcomed, as limited as it may be, but can he explain why we did not react at an earlier stage?

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