Mairéad Farrell (Galway West, Sinn Fein) | Oireachtas source

As I only have four minutes, I will only focus on one particular measure but I look forward to engagement on Committee Stage.

I want to focus, therefore, on the vacant homes tax. It is something which we have long been calling for and is something which, on the face of it, most people would probably welcome. We know that we have a significant stock of vacant homes, which we can see from just going through our towns, cities and rural areas. These number 166,000 according to the recent census. We know this adds to scarcity but also creates an artificial scarcity of supply, which helps to drive high prices and rents.

We also know that tax schemes for vacant homes has worked well in other countries. It has brought stock back into use while generating revenue to re-invest in vacancy and dereliction. On the face of it then, this measure should be welcome but unfortunately, here the devil is again in the detail. The Government's stated intention is to incentivise those with idle property to bring it into use. But if that is the intention, then why design it in such a way as to make it so avoidable?

Two legal experts have described this tax as “significantly compromised, to the point it could be considered virtue-signalling.” If we have a quick look at it, we can see that the tax is done on a self-assessed basis and that it would not apply to residential properties occupied for more than 30 days in a 12-month period.

But whether this is 30 consecutive days or not is not clear. Would it not be easy for the owner of this property to just say it is a holiday home, that they come and go for more than 30 days of the year, and then, hey presto, the owner is not liable for this tax? By remaining silent, would this still permit a situation where short-term letting could occur and then with the right planning, would the property still not fall liable for this tax? Again, that is not clear.

Nor is it clear how Revenue will be checking tax compliance. Will it use the GeoDirectory data, the latest census or some other method? If we were serious, the first thing I would have expected to see was some big anti-avoidance clause jumping out at me from this particular measure, that is, some big deterrent that said to those thinking of deliberately dodging their tax obligations that there would be serious consequences

There is also the fact that the charge itself is too low and does not increase with each subsequent year. The levy will be approximately 0.3% of the value of the property and does not automatically increase every subsequent year. In France, for example, the rate is 12.5%, which then doubles the following year. When the French introduced their tax in 1998, vacancy fell by 13% over the next four years leading to a significant increase in supply. We should contrast that with what we see here. Accountancy firm Deloitte recently noted that the impact of the Minister's tax measure on increasing supply would at best be "modest” and from looking at this, I can easily see why. We can see from the Revenue forecasts how much tax it expects to generate from this and it is estimating that around €3 million to €4 million will be brought in over the year. If one considers that an average-priced house would pay around €945 per annum, then at the lowest bands of the Revenue's estimate of €3 million raised, this would equate to around 3,200 liable homes.

That is simply not good enough. If this tax was a boat, it would have so many holes in it that it would not be able to sail from Malin Head to Mizen Head. I will seek to thrash that out on Committee Stage.

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