Cathal Crowe (Clare, Fianna Fail)
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229. To ask the Minister for Finance if his Department will consider the introduction of a scheme to assist first-time buyers of homes that are not new builds, similar to the help-to-buy scheme, who are financially out of reach of purchasing a newly build home. [5647/22]

Paschal Donohoe (Dublin Central, Fine Gael)
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The Help to Buy (HTB) incentive is a scheme to assist first-time purchasers with the deposit they need to buy or build a new house or apartment. The incentive gives a refund of Income Tax and Deposit Interest Retention Tax (DIRT) paid in Ireland over the previous four years, subject to limits outlined in the legislation. Section 477C Taxes Consolidation Act (TCA) 1997 outlines the definitions and conditions that apply to the HTB scheme.

HTB is specifically designed to encourage an increase in demand for new build homes in order to support the construction of an additional supply of such properties. An increase in the supply of new housing remains a priority aim of Government policy. A move to include second-hand properties within the scope of the Help to Buy scheme itself would not improve the effectiveness of the relief; on the contrary, it could serve to dilute the incentive effect of the measure in terms of encouraging additional supply.

With regard to the Deputy's question as to whether my Department will consider the introduction of a new scheme, similar to the HTB scheme, to assist first-time buyers of homes that are not new builds, it would be usual that proposals for tax expenditure measures would be assessed in accordance with my Department's Tax Expenditure Guidelines. These make clear that it is important that any policy proposal which involves tax expenditures should only occur in limited circumstances where there are demonstrable market failures and where a tax-based incentive is more efficient than a direct expenditure intervention.

A scheme along the lines proposed by the Deputy would provide no incentive effect for encouraging the building of new homes and would be likely to have a significant deadweight element and a high Exchequer cost. I must always be mindful of the public finances and the many demands on the Exchequer. Tax reliefs, no matter how worthwhile the policy objective, lead to a narrowing of the tax base and a strong and convincing case for the benefits and outcomes need to be articulated in order for due consideration to be given for the commitment of scarce taxpayer resources for such reliefs.

Finally, as the Deputy may know, in my Budget 2022 address, in addition to announcing an extension of HTB for a further year, I also undertook that a formal review of the scheme would take place in 2022. The intention is that the review will be fundamental in nature, and that it will inform decisions for Budget 2023 and Finance Bill 2022.