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

I thank Deputy Shortall. I am aware that she has been raising this issue for some time. I have little doubt at all that if I wanted to have a look at her budget proposals, they would be freely and publicly available.

The vacant homes tax, VHT, is a new measure announced in budget 2023 that aims to increase the supply of homes for rent or purchase to meet demand. Further detail on this measure is set out in the Finance Bill, which was published on 20 October. As stated in my budget speech, this measure aims to increase the supply of homes for rent or purchase, rather than raise revenue. In developing a new tax, an important consideration is clarity. It is important to ensure that the tax is easy to understand and administer. This is why I chose to set it at a multiple of a property's basic local property tax, LPT, charge as the LPT system is well understood.

The purpose of the VHT is to encourage behavioural change. Accordingly, the rate should be set at a level that will influence property owners' decision-making. A tax charged at three times a property's basic LPT charge represents a considerable financial penalty to those who leave properties vacant and will incentivise property owners to bring such properties back into use.

Let me bring this to life by way of an example for the House. The rate means that, for example, the owner of a vacant residential property valued at €250,000 would face a VHT charge of €625 in addition to the annual LPT charge of €225. The owner of a property valued at €400,000 would face a VHT charge worth €1,215, in addition to his or her annual LPT charge of €405, while the owner of a house valued at €500,000 would face a VHT charge of €1,485 in addition to an annual LPT charge of €495.

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