Michael D'Arcy (Fine Gael) | Oireachtas source

There is no good time to bring in a new tax at any stage anywhere because people do not like new taxes. Realistically, one must make a decision. Does one favour a property tax or not? When one compares a property tax or increased income taxes, there is no question of increasing income tax. Income tax increases are always a negative in respect of job creation. I held a financial forum in my home town of Gorey a few weeks' ago. There were 37 people at the meeting to whom we gave a simple choice between implementing a property tax or increasing income taxes. I must admit that I was very surprised by the outcome. Everybody favoured implementing a property tax over increasing income tax. It was a private ballot where everybody had the option of putting it on the record.

I was equally surprised when I read the amendments tabled by Fianna Fáil. This is not the television programme "Dallas" and Deputy Micheál Martin is not Bobby Ewing. He cannot step out of the shower and state we will ignore everything that happened in the past and pretend Fianna Fáil had nothing to do with agreeing to the memorandum of understanding. The Fianna Fáil-led Government of which he was a senior member agreed to the introduction of a property tax under that memorandum of understanding and that is exactly what we are implementing. In its opposition to the property tax - stating it is the wrong tax at the wrong time - Fianna Fáil is being somewhat dishonest. As stated, there is probably no right time to impose a new tax on the public.

In the context of its capacity as part of the Northern Ireland Executive, Sinn Féin has proved itself capable of implementing a property tax, a family home tax or whatever one wants to call it which is much more expensive than what we are discussing. I was very happy when the Minister agreed to fix the local property tax until 2016 because this means there will be clarity and no equivocation. For example, we will not be informed that the property tax will be doubled or trebled next year. The tax may or may not increase after the next general election. That will depend on who is in power at that point.

There is a need to highlight some facts. The best guesstimate is that there are 1.8 million homes in the State. We know that there are 750,000 mortgages on approximately 450,000 homes. If one subtracts one from the other and then subtracts the result from the guesstimate to which I refer, it is obvious that there are 1.4 million homes which are not the subject of mortgages. These are the facts. However, there are others which we should not ignore. I have stated on every occasion which has presented itself that there is a group of people who are in a particularly difficult position and to whom the property tax should not apply. I refer to those who purchased at the peak of the boom from 2002 to 2008. For whatever reason, these individuals' homes are in negative equity. They paid enormous stamp duty on their homes and the personal insolvency legislation is not going to apply to them. Senators may ask why this is the case. As the Minister of State is aware, the legislation to which I refer will apply to those who find themselves in the very worst of circumstances. We are informed that there are 45,000 such individuals. Not everyone is going to go down the route of personal insolvency. The people to whom I refer are those who will beg, borrow or scrape together the money to allow them to hold on to their properties and ensure they are not obliged to use the provisions of the Personal Insolvency Act which is in place for those who have no other options available to them. For some of these individuals, bankruptcy will be the only option. A majority of people will opt not to avail of the provisions of the Personal Insolvency Act. In such circumstances, it would be wrong to oblige those to whom I refer to pay property tax. I understand the Government does not want there to be many exemptions, particularly as this would lead to the system becoming diluted and the 1.8 million homes to which I refer becoming 1.4 million or 1.5 million.

What angers those who paid the household charge most is that another coterie of individuals have not paid it. As is the case with television licences, 80% to 85% of people pay, but the other 15% to 20% will not pay no matter what. Those who have paid are satisfied to pay their taxes, as is the case with the vast majority of citizens within the State. Those who do not pay because they do not deem it appropriate should be obliged to pay. There should, however, be some leeway for those who purchased their homes at the peak of the market, paid enormous stamp duty on them and now find themselves in negative equity, Those to whom I refer should be given a break. If they meet very strict criteria, they should be considered to have already paid property tax in the form of stamp duty. This could be done if there was a will to do it. Such an action would show that apart from putting in place the personal insolvency route, the Government was listening and trying to do something for the people in question. These individuals would not save a fortune if they were not obliged to pay property tax. It is not a question of money; rather, it is one of principle. If my suggestion was taken on board, it would demonstrate that the Government was prepared to do something for those who were caught out at the peak of the boom. I ask the Minister of State to communicate my very personal and strongly held view on this matter to the Minister for Finance. Many of my friends find themselves in the dilemma to which I refer and will not opt to take the personal insolvency route. We should try to do something for them.