why not base the tax on land values- easier to determine for “chunks” of areas (could be set by local authorities if we find a way of trusting them) and actually taxes based on the contribution of government to the property. Road maintenance and other council services benefit most households relatively equally?
Furthermore, it could be used as a way of preventing destructive land speculation?
Thanks to Ronan for bringing this important issue to light. The lack of a use tax on residential property is indeed an anomalous feature of the Irish tax system.
I should add that among its many other omissions, this system has contributed to the poor use of land in Ireland over the construction boom period.
Which brings me to what I think is property tax’s great attribute: It brings property to its highest and best use, by punishing vacancy and rewarding tenancy.
Another point is that if revenue collection is devolved to local government (as is the practice in many countries, such as France or the US), property tax can provide a vital stream of autonomous revenue for LAs. Such a move would help to restore meaning to the current system of LG in Ireland, which has become a sleepy breeding ground for future TDs.
[…] and excessive gentrification. Properties valued below a certain threshold should be exempt. While a change in mindset would be needed to adapt to property tax, the prospect of retirees on modest pensions having to […]
[…] argued before that a tax levied on residential property that averaged 1% could raise in the order of €4bn. Again, this could be combined with other government objectives, such as energy-efficient […]
Robert Browne
,
If this government, the one now in power without the consent of the people do not stop this monocultural, arrant madness of squeezing more and more taxes out of the economy it will not be long before the economy itself is pushed into terminal decline.
What about the reverse multiplier effect of taking disposable income out of peoples hands? The government is not doing anything productive with this money. It is using it instead to service a growing national debt currently approaching 62bn, using it to recapitalise dead banks, which are still not lending, either for job creation or job preservation. Also of course, it is being used to pay for the spiraling unemployment rates (11% +). All of the above, are current expenditures, which the government are trying to fund from a shrinking tax base. Bodies that are bled and bled some more, turn white then they die! Mr. Paul Krugman says we are faced with 5 years of ‘suffering”. How polite he is! This government is not for turning on NAMA on Anglo or on the impropriety of bleeding more taxation from an anemic economy. Have I ideas? Yes, Of course! Stimulus ideas not perdition of the economy. 30 years ago, dare I say, I was getting 98% in Economics exams from one of the best economics lecturers this country has ever had, who later went on to become president of the European Parliament. All the time, these politicians were developing their “economic policies” of traipsing around Galway tents and trying to curry favour with developers. It is only since February 2008 that our great Irish economists our great economic quango’s and economic lecturers bar one (Morgen Kelly) started to acquaint themselves with sup-prime, securitization, CD’s and even the simple notion of “credit squeeze” none of these will ever suggest “reality therapy.” Why? Because, they work for the government and 98% of them inhabit the parallel universe of the Public Service. If you want the painful truth you must first and foremost go outside of the quango’s and outside of the Public Service then you will be told in the plain simple unembellished language what has to be done. The laugh of it all, is, that none of them will be receiving any pensions down the line anyway when we have had the necessary truth commission.
[…] revenues by plugging the €10bn hole in property tax receipts seems all wrong to me. A 1% annual property tax could raise in the region of €4bn a year, and would be a stable replacement for unstable transactions-based stamp duties, so this is […]
If its energy efficiency you’re after tax the fuel, not the value of the house.
in the US many older people live basically in poverty, trailer parks. you don’t want to see that happening here – there is no need for it either, these people have earned their homes and should be allowed to continue living in them without having to pay each year.
charlberg
,
“Put more bluntly, the idea that people should be entitled to have any wealth stored away in property, as opposed to other forms of wealth, untouched by the government is out of date.”
Do you come from North Korea? Old people have paid tax on income to buy that property asset in the first place and for the vast majority of taxpayers, the home has always been their main pension resource because they couldn’t trust the state. Capital gains tax is not applied on the share portfolios of young people until a profit is crystalized, so why put on a tax on property which is basically a tax on the old people? Why not just gas them and steal their assets for the state..
Such solutions are great for the public sector who don’t take any cuts and has the taxpayer treating them to gold plated pension plans. If a property tax is applied, the public sector should have no problem to extend the extraoordinarily generous pension terms available to the public sector to the taxpayers who toiled over the past four decades to support them and now face a ruinous old age.
Gassing granny is not the solution..
I’m not if you’ve ever done college debating. If you have, you may be familiar with the lowest trick in the book, known as the Hitler trick, i.e. when stuck, contort the opposing argument into something comparable to Hitler/North Korea/gassing grannies, because every sensible thinking person couldn’t possible support those things. As you can imagine, I don’t have a lot of time for those kind of arguments.
Plus, if you had taken the time to look a little wider around the site, you might have found that this is not exactly a haven for arguments in favour of expanding public sector expenditure/wage/pension levels.
barratree ,
why not base the tax on land values- easier to determine for “chunks” of areas (could be set by local authorities if we find a way of trusting them) and actually taxes based on the contribution of government to the property. Road maintenance and other council services benefit most households relatively equally?
Furthermore, it could be used as a way of preventing destructive land speculation?
Graham ,
Thanks to Ronan for bringing this important issue to light. The lack of a use tax on residential property is indeed an anomalous feature of the Irish tax system.
I should add that among its many other omissions, this system has contributed to the poor use of land in Ireland over the construction boom period.
Which brings me to what I think is property tax’s great attribute: It brings property to its highest and best use, by punishing vacancy and rewarding tenancy.
Another point is that if revenue collection is devolved to local government (as is the practice in many countries, such as France or the US), property tax can provide a vital stream of autonomous revenue for LAs. Such a move would help to restore meaning to the current system of LG in Ireland, which has become a sleepy breeding ground for future TDs.
Lopping the top half off & Ireland’s property market in a global perspective « Ronan Lyons | Blog ,
[…] A €4bn Budget day suggestion – just how much could an Irish property tax raise? […]
Property Tax | Jaedi - Truth or Consequence ,
[…] and excessive gentrification. Properties valued below a certain threshold should be exempt. While a change in mindset would be needed to adapt to property tax, the prospect of retirees on modest pensions having to […]
The case for raising Ireland's corporate tax rate and introducing a property tax | Ronan Lyons ,
[…] argued before that a tax levied on residential property that averaged 1% could raise in the order of €4bn. Again, this could be combined with other government objectives, such as energy-efficient […]
Robert Browne ,
If this government, the one now in power without the consent of the people do not stop this monocultural, arrant madness of squeezing more and more taxes out of the economy it will not be long before the economy itself is pushed into terminal decline.
What about the reverse multiplier effect of taking disposable income out of peoples hands? The government is not doing anything productive with this money. It is using it instead to service a growing national debt currently approaching 62bn, using it to recapitalise dead banks, which are still not lending, either for job creation or job preservation. Also of course, it is being used to pay for the spiraling unemployment rates (11% +). All of the above, are current expenditures, which the government are trying to fund from a shrinking tax base. Bodies that are bled and bled some more, turn white then they die! Mr. Paul Krugman says we are faced with 5 years of ‘suffering”. How polite he is! This government is not for turning on NAMA on Anglo or on the impropriety of bleeding more taxation from an anemic economy. Have I ideas? Yes, Of course! Stimulus ideas not perdition of the economy. 30 years ago, dare I say, I was getting 98% in Economics exams from one of the best economics lecturers this country has ever had, who later went on to become president of the European Parliament. All the time, these politicians were developing their “economic policies” of traipsing around Galway tents and trying to curry favour with developers. It is only since February 2008 that our great Irish economists our great economic quango’s and economic lecturers bar one (Morgen Kelly) started to acquaint themselves with sup-prime, securitization, CD’s and even the simple notion of “credit squeeze” none of these will ever suggest “reality therapy.” Why? Because, they work for the government and 98% of them inhabit the parallel universe of the Public Service. If you want the painful truth you must first and foremost go outside of the quango’s and outside of the Public Service then you will be told in the plain simple unembellished language what has to be done. The laugh of it all, is, that none of them will be receiving any pensions down the line anyway when we have had the necessary truth commission.
Irish property tax, how to bring in a property tax | Ronan Lyons ,
[…] revenues by plugging the €10bn hole in property tax receipts seems all wrong to me. A 1% annual property tax could raise in the region of €4bn a year, and would be a stable replacement for unstable transactions-based stamp duties, so this is […]
Dankoozy ,
If its energy efficiency you’re after tax the fuel, not the value of the house.
in the US many older people live basically in poverty, trailer parks. you don’t want to see that happening here – there is no need for it either, these people have earned their homes and should be allowed to continue living in them without having to pay each year.
charlberg ,
“Put more bluntly, the idea that people should be entitled to have any wealth stored away in property, as opposed to other forms of wealth, untouched by the government is out of date.”
Do you come from North Korea? Old people have paid tax on income to buy that property asset in the first place and for the vast majority of taxpayers, the home has always been their main pension resource because they couldn’t trust the state. Capital gains tax is not applied on the share portfolios of young people until a profit is crystalized, so why put on a tax on property which is basically a tax on the old people? Why not just gas them and steal their assets for the state..
Such solutions are great for the public sector who don’t take any cuts and has the taxpayer treating them to gold plated pension plans. If a property tax is applied, the public sector should have no problem to extend the extraoordinarily generous pension terms available to the public sector to the taxpayers who toiled over the past four decades to support them and now face a ruinous old age.
Gassing granny is not the solution..
Ronan Lyons ,
I’m not if you’ve ever done college debating. If you have, you may be familiar with the lowest trick in the book, known as the Hitler trick, i.e. when stuck, contort the opposing argument into something comparable to Hitler/North Korea/gassing grannies, because every sensible thinking person couldn’t possible support those things. As you can imagine, I don’t have a lot of time for those kind of arguments.
Plus, if you had taken the time to look a little wider around the site, you might have found that this is not exactly a haven for arguments in favour of expanding public sector expenditure/wage/pension levels.