Seanad debates
Tuesday, 3 December 2019
Finance Bill 2019: Committee Stage
2:30 pm
Michael D'Arcy (Wexford, Fine Gael) | Oireachtas source
The previous tax relief for rent paid was abolished in budget 2011 and is no longer available to those who commenced renting for the first time from 8 December 2010. This followed a recommendation in the 2009 report by the Commission on Taxation that rent relief should be discontinued. The view of this independent commission was that in the same manner that mortgage interest relief increased the cost of housing, rent relief increased the cost of private rental accommodation. Accordingly, the result of reintroducing this relief would be a transfer of Exchequer funding directly to landlords, which would not have the intended effect of reducing the pressure on tenants. In addition, a tax credit of this nature would be of little benefit to lower income workers, the unemployed and students, who may not receive the benefit of the relief because they may not be paying sufficient income tax. The actions the Government proposes to take to address concerns about the cost of rental accommodation are set out in Rebuilding Ireland, the action plan for housing and homelessness. Finally, at the time of its abolition, the rental tax relief was costing the Exchequer up to €97 million per annum. Under certain assumptions it is likely that the annual cost of the proposal, if introduced, would be even higher. I do not propose to accept this recommendation.
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