Martin Heydon (Kildare South, Fine Gael)
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72. To ask the Minister for Finance his plans to introduce incentives for first-time buyers who are trying to purchase their first home; and if he will make a statement on the matter. [12296/16]

Michael Noonan (Limerick City, Fine Gael)
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The Programme for Partnership in Government makes reference to a "temporary targeted reduction of the rate of VAT from 13.5% to 9% on new, affordable houses and apartments, both public and private, timed to generate the maximum impact on supply and to target principally the purchasers of affordable homes".

However, I understand that such a VAT amendment would be very complicated to implement and may not deliver the relief to the purchaser, but instead would be absorbed by the builder. As the proposal is aimed at targeting the affordability of homes from the position of the purchasers, I do not believe such a VAT amendment would be of assistance.

As an alternative, and as I stated at the Oireachtas Committee on Housing recently, I have asked my Department to examine an approach through the income tax system, perhaps similar to the Home Renovation Incentive (HRI), in which a relief could be provided to home purchasers.

My officials are actively considering options for such an incentive and will set out possible parameters for its scope for my consideration in the near future.

Some of the issues that will need to be considered include the purchase price thresholds that could apply, the income level thresholds that might apply and the time span for which such an incentive might be available.