Pearse Doherty (Donegal, Sinn Fein)
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58. To ask the Minister for Finance the number of forward purchase agreements that were made prior to the passing of the financial resolution on 19 May 2021 providing for a 10% stamp duty measure on the bulk purchase of homes, such that the residential units under such agreements will not be subject to the measure when they are completed; the number of such units; the number of such forward purchase agreements that have been made since the passage of the financial resolution on 19 May 2021; and if he will make a statement on the matter. [31812/21]

Pearse Doherty (Donegal, Sinn Fein)
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In the middle of May, the Government brought forward a financial resolution to the Dáil to provide for a 10% stamp duty charge on the bulk purchase of ten or more residential homes. I assume the Minister, Deputy Donohoe, and the Minister for Housing, Local Government and Heritage crafted this measure in the full knowledge of activities in the housing market. Will the Minister indicate how many forward purchase agreements, which are exempt from the charge, were made prior to the introduction of this measure and in respect of which building completion and transactions have not yet occurred? Will he further indicate how many units are involved under those agreements and how many agreements, involving how many units, have been made since the resolution was passed?

Paschal Donohoe (Dublin Central, Fine Gael)
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The financial resolution passed by the Dáil on 19 May provides for a new higher stamp duty rate of 10% where at least ten residential units, excluding apartments, are acquired by an individual or corporate entity such as a company in any 12-month period. This new measure is triggered when a residential unit is acquired on or after 20 May 2021, with the look-back 12-month period commencing at that time on a rolling basis. The units acquired during that period are aggregated. When the tenth unit is acquired, it is chargeable at the 10% rate, and this rate also then applies to the other nine units and any other units acquired at the same time as the tenth unit. However, while any units acquired before 20 May are taken into account in establishing whether the threshold of ten units has been reached, the 10% rate of stamp duty is not applied to those units but only to units acquired on or after that date.

As the Deputy will be aware, multiple purchases by local authorities, approved housing bodies and the Housing Agency are outside the scope of the higher stamp duty provision. In this regard, he should also note that when putting this financial resolution on a permanent statutory footing, I propose providing an exemption from the 10% rate for the provision of the mortgage to rent scheme by private sector participants.

Finally, I am advised that the information sought by the Deputy in connection with forward purchase agreements is not collected by any Department. However, I will explore with the Minister for Housing, Local Government and Heritage whether it is possible to put in place a reporting regime for agreements of this nature.

Pearse Doherty (Donegal, Sinn Fein)
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That is an interesting but not surprising response from the Minister. He has no idea how many forward purchase agreements are already in place, yet he exempted every single one of them from the 10% stamp duty charge. He has no idea how many transactions have been completed since that date, yet he exempted them all from the increased stamp duty. That speaks volumes about how the Government was dragged, kicking and screaming, to this point, where it did want to be in the first place. The Minister did not want to tax the vulture funds and we know that from having this argument with him for the past number of years. He resisted it at every single twist and turn.

He has exempted some developments but he does not know how much is involved in that. He does not know how many bulk purchases could happen over the next number of years because he has no knowledge of how many such agreements are in place. As Minister for Finance, did he even look to find out that information? Did he inquire about it at any stage or did he just say, "Ah well, let it be", when he exempted all of them?

Paschal Donohoe (Dublin Central, Fine Gael)
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I made those decisions motivated by how we can put in place policies that deal with the issue that needed to be dealt with, which was the bulk purchase of family houses, while getting the balance right also allowing more apartments to be built in the future. I have information on the kinds of purchases, including forward purchases, that took place in recent years. However, on the question the Deputy asked regarding forward purchases that are currently being completed or are under way, that information is not available to me. This does not undermine the policy rationale for what I did. The reason I excluded those forward purchases is that they will enable more apartments to be built and made available to rent and more homes to be made available to people in the future. As the Deputy will be aware, taxation in regard to these investment funds occurs when income is returned to the investor who invests in the funds.

Pearse Doherty (Donegal, Sinn Fein)
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I ask the Minister to let me explain this to him. It is not about apartments. He exempted every single apartment from this stamp duty charge. This is about homes. He exempted funds that are buying full housing estates if there was a forward purchase arrangement already in place. That is the point. It is nothing to do with apartments, every one of which is exempt in any case under his policy. This is about people buying homes. It is about what happened in Maynooth being allowed to happen again.

The Minister has no idea how many such agreements are in place. He could read the reports published online that would give him some detail in this regard. His answer speaks volumes in that it shows he did not even look for that information or want to find it out. He came before this House and said that every single forward purchase agreement for homes will be exempt where a contract has already been entered into, as will every such project that completes over the next few months. This is being done because the reality is that Fine Gael did not want to go here in any case. It was dragged, kicking and screaming to this place where it had to introduce a minimum stamp duty. The provision in question will not make much of a difference because, if the rent yield is increased by approximately 10%, it will nullify the small stamp duty increase the Minister has imposed on only a certain section of homes.

Paschal Donohoe (Dublin Central, Fine Gael)
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The 10% stamp duty rate is ten times what is applied under the standard rate.

It is one third higher than the stamp duty rate that applies for commercial property. It is many times higher than the standard rate of stamp duty because of the intention I have to deter these kinds of purchases in the future. Of course, it must be seen in conjunction with the other aspect of that policy, namely, that it applies to ten or more houses that are purchased. That is the other part of the policy that is put forward. The only reason I put this policy in place is to get the balance right between trying to deal with an issue I accept needed to be dealt with, and allowing the supply in the future of more homes which will be apartments. If we were to extend this practice to forward purchases as well, the net effect would be fewer homes built for people in the future. I do not want to see that. I want to see more homes available. That is why the policy we have in place gets the balance right.