Simon Harris (Wicklow, Fine Gael)

In the early days of my time in this office, I agree with the Deputy's broader point on spending reviews, not monetising every problem and making sure there is value for money. I will engage with colleagues in relation to that as well.

I also acknowledge, and Deputy Doherty made this point earlier, and I was not saying it to be discourteous, that the way the rules of this place work is that people request reports by way of an amendment, but often they do that to vocalise their opposition to or, the odd time, their support for a measure coming forward. I do not believe a report into this matter in the Finance Bill per se is the best way to proceed.

Let me deal with the substance of the issues Deputy O'Callaghan raises and share my perspective on them. We do take all decisions regarding taxation measures in line with our Department's tax expenditure valuation guidelines. These guidelines do make clear that any policy proposal that involves tax expenditure should only occur in limited circumstances where there are demonstrable market failures and where a tax-based incentive is deemed more efficient than a direct expenditure intervention. I have been making this point. We know we have different political viewpoints on this but we do have a significant number of apartment developments or planning permission for apartments. In this city alone there are more than 40,000 that people who build apartments have deemed unviable to construct currently. What we are trying to do here is reduce the viability gap through a number of ways. This is just one way by which we are trying to do it.

The guidelines on tax expenditure valuations were most recently updated in 2024. They also set out the criteria that should be considered as part of the reviews of tax expenditures as well. Targeted tax incentives to encourage people to build more apartments and increased capital investment in infrastructure to support new schemes form the main housing measures of budget 2026.

The root cause of viability issues in relation to apartments is structurally high costs. Accordingly, sustainable progress on improving viability requires a relentless focus on cost reduction that maximises private sector participation. We can all have our views on the profit levels of companies and everything else, but at the end of the day, we need these companies to build apartments. That also has to be effected. If they are not building today, they have decided it is not viable to build from their commercial proposition. Do we do something to make it viable or do we just not concern ourselves with that? I believe we seek to make those developments viable because we want people to have an opportunity to be able to access those homes.

Where data exists in relation to the Exchequer cost of tax relief for housing market development, its is publicly available and is included in the Department of Finance report on tax expenditures published annually in advance of the budget, as well as in Revenue's publication on the cost of tax expenditures. The Finance Bill 2025 provides for the changes to the tax system announced on budget day that are intended to complement direct expenditure and capital investment in housing. Going forward, as data becomes available for these new schemes, it will be included in my Department's annual report on tax expenditures. In line with my Department's guidelines for tax expenditure evaluation, any expenditures that are expiring will also be subject to detailed review. These reviews are published by my Department.

As the Deputy reminded us, my predecessor committed to continuing to review the interplay of different tax schemes. I, too, commit to doing that. Having regard to the fact that indicative costings have already been prepared and published for the new measures - and, as stated, these will be included in the annual report on tax expenditures going forward and as data becomes available - I do not believe that an additional report is specifically necessary at this time. However, I am happy to engage with the Deputy on the thrust of what he is trying to get at, which is to look at the interplay between the different tax schemes and the benefit involved in terms of advancing the policy objectives. I will undertake to do that. I will also undertake to engage constructively, no doubt at the Committee on Finance, Public Expenditure, Public Service Reform and Digitisation and Taoiseach, as this issue arises in the period ahead.

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