Tuesday, Jul 27, 2010
A silver bullet for the emerald isle?
Irish Independent: Property tax: how will it work
The prospect of a property tax is looming large as the Government attempts to plug holes in the Exchequer finances. An annual tax based on the value and size of the property is being considered. For a lower-valued house, homeowners would pay around €250 a year, while those with a pricier house in a sought-after area would pay more than €3,000 a year. The Commission on Taxation report recommended that the tax should apply to residential properties, second homes and holiday homes, which means it would replace the €200 levy imposed by local authorities. The owners of residential housing that is rented out would also have to pay the tax. Commission recommendations would see the tax applied to vacant housing units as well.
Posted by drewster @ 10:23 PM (736 views) Add Comment
4 Comments
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1. drewster said...
[Credit to gruffydd on the HPC forums: http://www.housepricecrash.co.uk/forum/index.php?showtopic=146265]
2. mark wadsworth said...
Splendid.
What the Irish also ought to consider is scrapping all the tax breaks for land ownership and construction that they have. There's no point taxing something and subsidising it at the same time.
3. easybetman said...
Sounds good on first look but reading the details, it is just a council tax where amount paid are banded. Further, those who "can't pay" are exempted, though vacant properties will be hit. It also requires properties to be valued individually. 1% on last transaction price adjusted for an index will be much simpler and if the valuation has changed for the worse, then the owner is welcome to get an approved surveyor to update the valuation (and hence a lower bill) at his own expenses.
http://www.independent.ie/business/personal-finance/property-mortgages/property-tax-how-will-it-work-2241335.html
4. drewster said...
easybetman,
Yes I agree there are flaws. For one, the tax is based on the value of the property, not the land. Secondly it's based on asset value, not on rental value (it's better to tax the rental value of land rather than the selling price, because rents don't fluctuate so much). Thirdly there are exemptions. Still, it's a step in the right direction for a country which for too long undertaxed property.