Written answers

Tuesday, 20 June 2017

Department of Finance

Living City Initiative

Photo of Barry CowenBarry Cowen (Offaly, Fianna Fail)
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290. To ask the Minister for Finance his views on the fact that the uptake of the Living City initiative has been lower than anticipated or desired from a policy perspective; the reason for the low take up; his further views on the fact that claiming for the LCI is unnecessarily complicated and could be made more user friendly (details supplied); his further views on the fact that the public knowledge of the scheme is very low; and his views on whether more regeneration areas should be covered under the scheme. [27826/17]

Photo of Paschal DonohoePaschal Donohoe (Dublin Central, Fine Gael)
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The Living City Initiative was originally introduced in Finance Act 2013 on a pilot basis to encourage the regeneration of the historic cities of Waterford and Limerick. As you may be aware, the original intention was to restrict the scheme to Georgian houses.  The particular focus of the scheme was to encourage people back to the centres of these cities to live in historic buildings, in particular Georgian houses, and to encourage the regeneration of the retail heartland of central business districts. Following an ex-ante cost/benefit analysis of the scheme and consideration of submissions from interested parties, I decided to extend the Initiative in 2014 to the cities of Dublin, Cork, Galway, and Kilkenny and to broaden its scope to include all houses constructed prior to 1915. The pre-1915 requirement only applies to the residential elements of the scheme (owner-occupier and rented residential) and not to the commercial element which does not have such a restriction.

To date, take-up of the Living City Initiative scheme has been lower than anticipated.  Officials in my Department reviewed the Living City Initiative in 2016 in consultation with the relevant councils and the Department of Arts, Heritage, Regional, Rural and Gaeltacht Affairs. This review was included in the Report on Tax Expenditures (October 2016) that was published on Budget Day.

In light of the findings in the report, I announced a number of changes to the scheme in Budget 2017 in order to make it more attractive and effective. The principal change extended the residential element of the scheme to landlords, who are now able to claim the relief by way of accelerated capital allowances for the conversion and refurbishment of property, which was built prior to 1915, where such property is to be used for residential purposes. In addition, I also decided to remove the requirement for a pre-1915 building to have been originally constructed for use as a dwelling in order to qualify for the residential element of the Initiative. The floor area restriction for owner-occupiers has also been removed, while the minimum amount of capital expenditure required for eligibility for relief, under all elements of the scheme, was also amended and must now only exceed €5,000. The possibility of extending the special regeneration areas was considered, but I decided that such a change would dilute the incentive's potential impact on the originally targeted areas and that it would be better to get it working effectively before considering any further extension of the areas eligible.

I am advised by Revenue that the number of applications received by the Councils for relief under the residential element of the scheme has increased from 51 in November 2016, before the amendments were introduced, to 61 in April 2017. The scheme was publicised and promoted by way of town hall meetings/workshops and door-to-door leaflet drops organised by the relevant City and County Councils following its launch in May 2015. These workshops were also attended by a representative from Revenue to provide more detailed information as required. Information regarding the Incentive is also available on the websites of Revenue, Department of Finance and the relevant City and County Councils. In addition, my officials have been in contact with officials in the Department of Arts, Heritage, Regional, Rural and Gaeltacht Affairs with regard to potential opportunities to further promote the incentive.

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