Paschal Donohoe (Dublin Central, Fine Gael) | Oireachtas source

We dealt with this issue on Committee Stage. I will reiterate the two points I made at the time.

In principle Deputy Pearse Doherty is against any measure that might add to the price of homes or that might drive the demand for them. However, when I seek to make a policy decision to alleviate the pressure on pricing, acknowledging the fact that the ESRI carried out a report in which it argued that demand side tax incentives such as this could add to the pressure on pricing in the market, the Deputy is also against it. We are removing mortgage interest relief because increasingly it is being baked into the pricing of homes. The Deputy acknowledges that Governments can do things that drive up the price of homes, but when we seek to remove a measure such as this, he also opposes it. For clear reasons, we will not extend the relief. This is a measure that currently is only available to a certain number of people within the State based on when they bought their homes. We made an agreement with Fianna Fáil that we would abolish it, but that it would be abolished at a slower rate in order to be fair to the people who benefited from it and acknowledge the affect it had on persons who did not have it. Some contend there are measures the Government could take to force up prices. If it was to remain in the tax code, this measure would have the potential to do so. That is why we have sought to unwind it over time in a way that is fair to all.

See this speech in context