Jackie Cahill (Tipperary, Fianna Fail)
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65. To ask the Minister for Finance if there are exemptions for a farmer who has zoned land from the proposed levy under the Finance Bill 2021; and if he will make a statement on the matter. [57858/21]

Paschal Donohoe (Dublin Central, Fine Gael)
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Finance Bill 2021 introduces the ‘Residential Zoned Land Tax’ into the Taxes Consolidation Act 1997, giving effect to a measure I announced on Budget day. This measure is part of the suite of measures included in the ‘Housing for All’ Strategy, which was published by the Government in September 2021. The Residential Zoned Land Tax is designed to prompt residential development by owners of land that is zoned for residential or mixed-use purposes and that is serviced. It will replace the Vacant Site Levy when it comes into operation.

The Residential Zoned Land Tax is an annual tax, calculated at a rate of 3% of the market value of the land. It applies to land that is both zoned as suitable for residential development and is serviced. It will not apply to land on which development cannot take place by reason of its physical condition, for example land which is contaminated.

There are a limited number of exclusions from the measure. Of relevance to a farmer, the tax will not apply to:

- residential dwellings and their gardens;

- land which is zoned for a mixture of residential and other uses (and not purely for residential development) that is integral to the operation of a business carried out on or beside it.

In order that landowners can know if their land is within scope of the tax, each local authority will prepare and publish a map identifying land within the scope of the tax.

The first draft map will be published by the local authorities on 1 November 2022. The purpose of publishing the draft map is to allow landowners, including farmers, to see if their land is within scope of the tax. If a landowner sees that their land is included on the draft map, and believes that it should not be, there are two separate courses of action open to them:

1. If the landowner believes that the land is not serviced, or falls into one of the specific limited exclusions from the tax, they can make a submission to the local authority seeking to have the map updated and their land removed from the map.

The local authority will consider the submission and make a determination on whether the land should stay on the map or be removed from it. If the landowner disagrees with the determination, they can appeal to An Bord Pleanála.

2. If the landowner believes that the land should not be zoned as suitable for residential development, they can make a submission to the local authority seeking to have the land rezoned.

The local authority will consider the submission and, if they decide it is appropriate, they will commence a variation procedure to alter the zoning of the land. This variation procedure, and the local authority’s decision on whether or not to commence one, is part of the normal zoning process.

Tax on land which is suitable for residential development on 1 January 2022 because it is both zoned and serviced on that date, and on which development has not commenced before 1 February 2024, will be due and payable in May 2024. Where the land becomes both zoned and serviced after 1 January 2022, tax will be chargeable in the third year after it comes within scope of the tax.

Agricultural land that is zoned and serviced and which is, therefore, suitable for residential development, will be within the scope of the tax. The application of the tax to such land must be looked at in terms of the ability of a local authority to plan effectively for the development of their area and the country’s current need for additional housing. Land, including agricultural land, that a local authority zones as suitable for residential development and which is serviced, is land that can be objectively identified as suitable for the development of homes in an area in which a need for housing exists.