Property Tax - suggestions

321654

The easiest way to manage this i think is to do the following :

1 - Abolish stamp duty.

2 - Bring in a property tax on all houses bought from that date on.


People who have already paid property tax in the form of stamp duty will not be taxed twice.

Those who buy now, will know ahead of buying that they will be paying tax from then on.

It might stimulate the economy a bit.

My landlord says he already pays tax at 41% on any profit made from his business. That, and the stamp duty he paid when he bought the houses seems fair enough to me.
Why tax people who already paid their tax and are paying it now still. We cant kill off businesses now. And landlords are running a necessary business, whether we like to believe that or not.

And why tax people who have holiday homes either? They have paid tax too when they bought and probably taken a hit already anyway in the value. I just dont see the point in asking for this, other than begrudgery, which there is a lot of going around in Ireland at the moment. People just hate to see others doing well in life.

Tax should be paid on income. A house or indeed a second house has no specific income bar rent (which tax is paid on as it is earned) until it is sold. So tax is paid when it is bought already. And tax will be paid when its disposed of. Property is taxed to the neck as it is.

The only income from property not taxed at present is the rent a room scheme. I see no problem with taxing this income.

321654

Fighting Irish wrote: »

lol @ people wanting more taxes

No quite true. PEople want more taxes for OTHER people.
Sad really what its come to isnt it.

SkepticOne

I think with any tax like this there would probably need to be an exemption for people who bought in recent years at inflated prices but, in principle, I would be in favour of this sort of this sort of tax instead of a tax on transactions like stamp duty. Something I think is going to be important in the coming years is labour mobility and stamp duty works against this.

gurramok

P. Breathnach wrote: »

It's an odd phenomenon that when people preface a statement by saying "with all due respect" they usually then say something quite disrespectful.

Have a look at post #43, it was reaction to another poster.

P. Breathnach wrote: »

A house is a form of wealth. Building a house benefits many people financially. Living in a house is a benefit to the occupier. Who hasn't a clue?

Eh, we're talking about economic wealth here. How does building a house benefit 'many' people?
It benefits a few(builders etc) in building it and servicing it, how does that generate wealth for the economy?
It seems you want the economy to go back to building countless houses again as you say they generate wealth!
Who hasn't a clue?

Fighting Irish wrote: »

wait are we talking about a once off property tax or a yearly property tax?
I'm talking about a yearly property tax

Same here

321654 wrote: »

My landlord says he already pays tax at 41% on any profit made from his business. That, and the stamp duty he paid when he bought the houses seems fair enough to me.
Why tax people who already paid their tax and are paying it now still. We cant kill off businesses now. And landlords are running a necessary business, whether we like to believe that or not.

You're landlord has written off huge mortgage interest and fixtures and fittings against tax every year, thats hundreds of millions the govt could have.
Landlords have benefited hugely since the bubble started. Now we have a huge oversupply of them so no need to incentivise property investors anymore.

321654

gurramok wrote: »

You're landlord has written off huge mortgage interest and fixtures and fittings against tax every year, thats hundreds of millions the govt could have.
Landlords have benefited hugely since the bubble started. Now we have a huge oversupply of them so no need to incentivise property investors anymore.

Now that is some serious begrudgery right there.
He has written down the costs of doing business. Like every single other business there is.

You could say any business has benefitted hugely since the bubbles started. Should we now not allow all of the businesses in the country to deduct all of their running expenses from their profits?

Treating those who own second properties the same as treating any other business is not incentivising them. Its treating them fairly. Expenses are expenses, and profits are profits, no matter what business you run.

I have to keep track of all expenses and orders in my job. As well as interest on loans for cashflow etc. Its all written off the profits. Why? Because its the cost of doing business and is not profit.

We have a huge oversupply of everything in this country. Should we now tax people just because we can, or should we be fare about it and tax profits only, which is the correct way to do it.

And remember, while rents are falling and there is an oversupply of property now, its very easy to pick on those who got up off their holes and started a business (which generates tax for the revenue).
But when things swing around, its you and i who will be paying for these extra charges on businesses in the end price.

gurramok

Hold on, its not begrudgery, its simple maths. There are too many landlords who have very few tenants hence no need to incentivise anymore to join their numbers.
Incentivisation should be directed at creating industry/services that generate wealth, lets not pour more money into property.

Your business is a business. Assuming your not connected to property, your business is generating wealth, thats a good thing. Property investment in my view does not generate wealth for the country, it should be down the list of priorities for any govt to incentivise and now is the perfect time to do so due to chronic oversupply.

Regarding the write-off expenses/mortgage interest, from memory that was introduced around 2000/2001 to address a genuine housing shortage in the rental market hence no need for it anymore.

321654

gurramok wrote: »

Hold on, its not begrudgery, its simple maths. There are too many landlords who have very few tenants hence no need to incentivise anymore to join their numbers.
Incentivisation should be directed at creating industry/services that generate wealth, lets not pour more money into property.

Your business is a business. Assuming your not connected to property, your business is generating wealth, thats a good thing. Property investment in my view does not generate wealth for the country, it should be down the list of priorities for any govt to incentivise and now is the perfect time to do so due to chronic oversupply.

Regarding the write-off expenses/mortgage interest, from memory that was introduced around 2000/2001 to address a genuine housing shortage in the rental market hence no need for it anymore.

Im sorry but it is blatant begrudgery no matter how you try to dress it up.

It does generate wealth. Im not even going to bother explaining how it does. Im sure you know and you're just arguing for the sake of arguing.

And we all remember what a disaster the tax changes in 2000/2001 were dont we.

Again let me point out that a landlord running his business is exactly like the same as any other company running a business.
They sell a poduct. They have expenses. They make profits. They deduct running costs. They pay tax on profits. They dont make profits every year. They will pay tax when they dispose of the business. They are subject to market forces.

In fact landlords pay more tax as it is than the average business.

And singling out any sector for extra tax is just unfair. No matter which sector.
This is the biggest problem we have right now in this country. Everyone is not rowing the boat in the same direction. They all want someone else to do the rowing.

Anonymous1987

gurramok wrote: »

Hold on, its not begrudgery, its simple maths. There are too many landlords who have very few tenants hence no need to incentivise anymore to join their numbers.
Incentivisation should be directed at creating industry/services that generate wealth, lets not pour more money into property.

Your business is a business. Assuming your not connected to property, your business is generating wealth, thats a good thing. Property investment in my view does not generate wealth for the country, it should be down the list of priorities for any govt to incentivise and now is the perfect time to do so due to chronic oversupply.

Regarding the write-off expenses/mortgage interest, from memory that was introduced around 2000/2001 to address a genuine housing shortage in the rental market hence no need for it anymore.

Property development and investment does generate wealth. It is a physical good. An undeveloped site sells for less than one with a house on it. The difference is the wealth creation generated from the house. Rather than haven an open field you now have a building suitable for living.

As for investing in a property improvements made to a house generate wealth. This includes fixtures and fittings; you would pay less for a house that hasn't being painted or renovated in 20 years than a house that is newly renovated. The difference again is investment and wealth creation. These should be tax deductible as an expense because the landlord is paying to improve the house if you were to remove this, many landlords will not see the benefit in improving their properties as any additional rent or sales price they might receive for these improvements will be eroded by tax. Therefore a glut of substandard properties would emerge on the market as the profit motive would be taken away.

Fighting Irish

Its fairly simple what this government needs to do, stop helping the people who don't even try

P. Breathnach

gurramok wrote: »

Have a look at post #43, it was reaction to another poster.

Fair comment: I didn't see that one.

Eh, we're talking about economic wealth here. How does building a house benefit 'many' people?
It benefits a few(builders etc) in building it and servicing it, how does that generate wealth for the economy?
It seems you want the economy to go back to building countless houses again as you say they generate wealth!
Who hasn't a clue?

Why are you posting in an economics forum if you don't accept economic realities? You have ignored or distorted any argument that I have put up that actually has an economics dimension to it.

Further, the distinction you persistently make between professional and other landlords is quite unclear, and appears to be capriciously applied.

I won't accuse you of begrudgery, as 321654 has. It's worse: it's randomly-directed spite.

gurramok

P. Breathnach, i've re-read your posts and all i can see is that you are talking about wealth held by individuals who rent out houses. They do constitute a tiny number of the workforce.

My point was that investing in property as a first priority for an investor who wants to invest is pretty lame. It should be down the list of investment priorites as(now listen), it does not generate income for the country.
You cannot export physical goods(as Anonymous1987 called them) like houses. It does not generate wealth, it circulates wealth in a country just like the public sector does for example, it does not grow national economic wealth.

They are not tradeable goods and only benefit a wealthy minority of which some think they are wealthy but up to their eyes in debt hence my reference to them be weeded out as they are unstabilising to the banking system.

These landlords or what i prefer to call them as amateur BTL's helped put the banking system down the tubes and alot benefited from the bubble, its now high time they contributed to a recovery by a pittance of a €1,000 tax per property.
And yes, abolish stamp duty and at the same time withdraw the tax incentives landlords have for writing off mortgage interest as tax deductable.

As you are so opposed to a tax on rental/vacant property, kindly explain why Ireland should be different in the EU in not having a property tax?

I hope you won't describe the above like some words used here as begrudgery, bollocks or randomly-directed spite

blast05

It should be down the list of investment priorites as(now listen), it does not generate income for the country.

This is a new one to me ... an investor should only invest in something that will make money for country ! Have you ever invested in anything in your life ? If so, then who did you do it for and what made you chose one option over another ..... answer to the second part in case you don't get is 'whatever will make you most money' ...... and this was the reality of property in this country for much of the last decade.

These landlords or what i prefer to call them as amateur BTL's helped put the banking system down the tubes and alot benefited from the bubble

You still don't get it. Most BTL properties bought in the Celtic Tiger are now in negative equity territory so how are they making money ? And which contributed more to the state the banks are in now - a few tens of thousands of buy to let landlords who were merely uptaking on the opportunities that governmnet strategy/policy drove OR was it government policy plus lack of regulation plus the mega builders who now have massive massive loans that will never be paid off
You still haven't answered my earlier question as to why i should have to pay a property tax on my holiday home

and at the same time withdraw the tax incentives landlords have for writing off mortgage interest as tax deductable.

Lets do the same for all businesses in this country re writing off expenses against profits and we'll see where we end up. Even if its only done in the property sector then what will happen is that there will be a complete and utter collapse of the property market with even larger numbers of landlords than at present unable to meet repayments and declaring bankruptcy which will leave the banks/government to shoulder the debt which they won't be able to afford and will lead to either the ECB or IMF coming in running the country ..... and then we wil see real pain - of course this may happen anyway.
This won't be the fault of the landlords, it will be caused by a complete reversal in economic policy by the government. So like it or lump it, but if landlords get screwed in the way you would like them to be screwed, then everyone (including you) will feel the pain.

They are not tradeable goods and only benefit a wealthy minority

You are being deliberately ridiculous or are just plain ignorant
What of the massive amounts of money that has found its way into the hands of the building suppliers over the last 10 years as a basic example.
What of the in excess of 300,000 working in the property sector over the last 10 years - i am sure they would beg to differ, there is a motorway infrastructure being built throughout the country that was built on the back of the taxes from the property boom which benefits almost everyone, there were massive pay risees in the public sector which were unsustainably funded by the boom - i think these people would consider themselves to have benefited.

gurramok

blast05 wrote: »

This is a new one to me ... an investor should only invest in something that will make money for country ! Have you ever invested in anything in your life ? If so, then who did you do it for and what made you chose one option over another ..... answer to the second part in case you don't get is 'whatever will make you most money' ...... and this was the reality of property in this country for much of the last decade

None of your business on where my investments have been involved in

So there you have it in your last sentence, its an admittance of greed for the individual that put us in this mess. That does not make it right, its damn well wrong.
They should of invested in export based industry/services to help generate wealth.

blast05 wrote: »

You still don't get it. Most BTL properties bought in the Celtic Tiger are now in negative equity territory so how are they making money ? And which contributed more to the state the banks are in now - a few tens of thousands of buy to let landlords who were merely uptaking on the opportunities that governmnet strategy/policy drove OR was it government policy plus lack of regulation plus the mega builders who now have massive massive loans that will never be paid off
You still haven't answered my earlier question as to why i should have to pay a property tax on my holiday home

So you would prefer for those BTL's in negative equity to be not touched and prolong the pain for the banking system as you know those BTL's will go bust as it will be many years before prices will recover coupled with many years for the rental sector to recover. Zombie banking comes to mind.

I answered your question. Tax holiday homes as they are a luxury. Ask the army of unemployed what they think of them as well.

blast05 wrote: »

Lets do the same for all businesses in this country re writing off expenses against profits and we'll see where we end up. Even if its only done in the property sector then what will happen is that there will be a complete and utter collapse of the property market with even larger numbers of landlords than at present unable to meet repayments and declaring bankruptcy which will leave the banks/government to shoulder the debt which they won't be able to afford and will lead to either the ECB or IMF coming in running the country ..... and then we wil see real pain - of course this may happen anyway.
This won't be the fault of the landlords, it will be caused by a complete reversal in economic policy by the government. So like it or lump it, but if landlords get screwed in the way you would like them to be screwed, then everyone (including you) will feel the pain.

So i see you approve of the section 23 tax schemes then? Lets face it, there will be pain, they are going to go bust anyway as they are overstretched with many of them on interest only mortgages hence my earlier point about weeding them out. the prudent who i believe there are many will survive, they are professional.
The IMF stuff is down to govt mismanagement. The housing bubble is a huge consequence of that ever occurring.

blast05 wrote: »

You are being deliberately ridiculous or are just plain ignorant
What of the massive amounts of money that has found its way into the hands of the building suppliers over the last 10 years as a basic example.
What of the in excess of 300,000 working in the property sector over the last 10 years - i am sure they would beg to differ, there is a motorway infrastructure being built throughout the country that was built on the back of the taxes from the property boom which benefits almost everyone, there were massive pay risees in the public sector which were unsustainably funded by the boom - i think these people would consider themselves to have benefited.

300,000 working in property was double what a sustainable construction sector should have. Building suppliers, did they export stuff?

The key word here is 'unsustainable'. Those benefits you speak of were not generating wealth, they were based on passing the debt onto buyers who in turn paid up front for those tax revenues.

So i take it that you approve of the continuation for example of the Rent Supplement scheme to landlords then which you and i pay for?

That coupled with the generous tax breaks for property investors are costing this country a fortune. Too many benefits available, taking some of that back via a property tax is righteous.

321654

Gurramok you just dont get it all do you.

A man makes some money, uses it and gets a loan for the rest to buy a van and going out cleaning windows. He charges people to have their windows cleaned. At the end of the year if he makes a profit he pays tax on it. But he deducts his expense (interest on the loan, repairs, petrol, cleaning materials, ladder and so on) and pays tax on the remainder. He might also make a loss.

A man makes some money, uses it and gets a loan for the rest to buy a house and rents it out. He charges people rent to live in the house. At the end of the year if he makes a profit he pays tax on it. But he deducts his expense (interest on the loan, repairs, cleaning materials, improvements and so on) and pays tax on the remainder. He might also make a loss

Whats the difference?

Theres need for renters AND buyers in a property market. To rent, someone must own the property and be willing to rent it. And there must be profit in it to attract these investors. And that these people are running a business the same as anyone running any other business. Their profits will go up and down with economic cycles.

Ireland does have a property tax right now. Its a stupid property tax that needs review, but it is a property tax. And taxing anyone who has already paid this tax is nothing short of double taxation. Rather like VAT on VRT (how do they get away with that).

So if we discourage property investors what will that do for renters? I for one dont want a repeat of the long lines of 2001 looking for somewhere to live and having to bid on rent with others on the doorsteps. Is everyone to buy their own house? How do we get movement of labour then. Or where are immigrants to live. Despite what you may think this economic downturn will recover and people will be looking to settle down, invest or sell again.

The property situation is the same the world over.

Is Ireland different?

You obviously do direct your spite though. Straight at any house owner.

Are you trying to drive prices down so you can buy a house? Or do you just hate people who were able to buy houses (which is what i think most likely)?
Do you think that talking down property will have any effect on the market? Im sorry to tell you it wont. The market will respond to economic forces as it always does everywhere.

Godge

321654 wrote: »

Im sorry but it is blatant begrudgery no matter how you try to dress it up.

It does generate wealth. Im not even going to bother explaining how it does. Im sure you know and you're just arguing for the sake of arguing.

And we all remember what a disaster the tax changes in 2000/2001 were dont we.

Again let me point out that a landlord running his business is exactly like the same as any other company running a business.
They sell a poduct. They have expenses. They make profits. They deduct running costs. They pay tax on profits. They dont make profits every year. They will pay tax when they dispose of the business. They are subject to market forces.

In fact landlords pay more tax as it is than the average business.

And singling out any sector for extra tax is just unfair. No matter which sector.
This is the biggest problem we have right now in this country. Everyone is not rowing the boat in the same direction. They all want someone else to do the rowing.

That is complete rubbish. A landlord is not the same as any other business and they need to be singled out.

The following example shows why. Say I have a facility to borrow some money but I have am choosing between investing in buying a property (which creates zero jobs) or investing in a friend's business (creating 20 jobs). Well the tax system favours investing in a property by allowing me to write off the mortgage interest against tax while investing in my friend's business gains no tax incentive.

The tax system favours the builder and property owning friends of FF. We need a tax system that penalises property ownership but rewards businesses creating jobs.

Godge

Godge wrote: »

That is complete rubbish. A landlord is not the same as any other business and they need to be singled out.

The following example shows why. Say I have a facility to borrow some money but I have am choosing between investing in buying a property (which creates zero jobs) or investing in a friend's business (creating 20 jobs). Well the tax system favours investing in a property by allowing me to write off the mortgage interest against tax while investing in my friend's business gains no tax incentive.

The tax system favours the builder and property owning friends of FF. We need a tax system that penalises property ownership but rewards businesses creating jobs.

You are assuming then, that there exists a sufficient housing stock for you to purchase a house to rent out, and there also exists sufficient stock for these 20 people to rent or buy.

321654

Godge wrote: »

That is complete rubbish. A landlord is not the same as any other business and they need to be singled out.

The following example shows why. Say I have a facility to borrow some money but I have am choosing between investing in buying a property (which creates zero jobs) or investing in a friend's business (creating 20 jobs). Well the tax system favours investing in a property by allowing me to write off the mortgage interest against tax while investing in my friend's business gains no tax incentive.

More rubbish.
You cant compare a person buying a property themselves, to you investing investing in a company that creates jobs.

Please compare like with like.

The person buying a house to let it invests in his own business. Effectively creating a business for himself of which he is the only employee.

If you invest in your own business employing only yourself you have exactly the same effect.


And saying investing in a house creates no jobs is a load of bollox too.
Think about what you are saying.

Everything money is spent on is supporting jobs. Right down to the Mars bar you buy on your way to work tomorrow.

P. Breathnach

gurramok wrote: »

P. Breathnach, i've re-read your posts and all i can see is that you are talking about wealth held by individuals who rent out houses. They do constitute a tiny number of the workforce.

It doesn't matter a damn how many there are; we are discussing principles (well, I am).

My point was that investing in property as a first priority for an investor who wants to invest is pretty lame. It should be down the list of investment priorites as(now listen), it does not generate income for the country.
You cannot export physical goods(as Anonymous1987 called them) like houses. It does not generate wealth, it circulates wealth in a country just like the public sector does for example, it does not grow national economic wealth.

Do you know anything at all about economics? Or motives for investment?

They are not tradeable goods and only benefit a wealthy minority of which some think they are wealthy but up to their eyes in debt hence my reference to them be weeded out as they are unstabilising to the banking system.

Assertion is not proof. And why do you seem to despise people who are in debt?

You appear to want marginal landlords to be forced into capital deficit rather than to survive in business. Should that happen, loan defaults are likely to increase. How might that increase the stability of the banking system? As I already said, you cannot change the past, and you cannot simply reverse transactions that happened one or two or three years ago (I sure there are many people who wish they could).

These landlords or what i prefer to call them as amateur BTL's helped put the banking system down the tubes and alot benefited from the bubble, its now high time they contributed to a recovery by a pittance of a €1,000 tax per property.

I already mentioned the marginal effect that this might have (an economic concept) and you ignored it. It seems to me that you are in an economics forum and have no interest in economics.

And yes, abolish stamp duty and at the same time withdraw the tax incentives landlords have for writing off mortgage interest as tax deductable.

Would you care to explore the economic effect of such a policy change?

As you are so opposed to a tax on rental/vacant property, kindly explain why Ireland should be different in the EU in not having a property tax?

You said that you re-read my posts, and yet you represent that as my position! I oppose levying a property tax solely on investment properties or second homes.

I hope you won't describe the above like some words used here as begrudgery, bollocks or randomly-directed spite

Just bollocks this time.

I do recognise, gurramok, that you are not for turning on this. I have continued posting to pass the time, and have been justifying it to myself on the basis that there might be others reading who are open to persuasion. But I have had enough.

gurramok

321654 wrote: »

Gurramok you just dont get it all do you.

A man makes some money, uses it and gets a loan for the rest to buy a van and going out cleaning windows. He charges people to have their windows cleaned. At the end of the year if he makes a profit he pays tax on it. But he deducts his expense (interest on the loan, repairs, petrol, cleaning materials, ladder and so on) and pays tax on the remainder. He might also make a loss.

A man makes some money, uses it and gets a loan for the rest to buy a house and rents it out. He charges people rent to live in the house. At the end of the year if he makes a profit he pays tax on it. But he deducts his expense (interest on the loan, repairs, cleaning materials, improvements and so on) and pays tax on the remainder. He might also make a loss

Whats the difference?

A window cleaner has a job cleaning windows and perhaps employs a team doing the rounds hence further jobs created. Where's the job creation that the second person creates?

321654 wrote: »

Theres need for renters AND buyers in a property market. To rent, someone must own the property and be willing to rent it. And there must be profit in it to attract these investors. And that these people are running a business the same as anyone running any other business. Their profits will go up and down with economic cycles.

Ireland does have a property tax right now. Its a stupid property tax that needs review, but it is a property tax. And taxing anyone who has already paid this tax is nothing short of double taxation. Rather like VAT on VRT (how do they get away with that).

So if we discourage property investors what will that do for renters? I for one dont want a repeat of the long lines of 2001 looking for somewhere to live and having to bid on rent with others on the doorsteps. Is everyone to buy their own house? How do we get movement of labour then. Or where are immigrants to live. Despite what you may think this economic downturn will recover and people will be looking to settle down, invest or sell again.

The property situation is the same the world over.

Is Ireland different?

No Ireland is not different regarding in the cycles you describe. What you are missing is teh big elephant in the room and i explained in a previous past is that there is a chronic oversupply of available property to rent.
Along with Irish emigration and immigrants returning home plus our majorly home grown recession, it will be many years before you will queue like in 2001.
If for lets say in 2020, a shortage arises of rental property due to demand, then lets introduce some tax breaks again to get more rental property available. I am talking about short term where there is NO shortage hence no need for property investment incentivisation.[/quote]

321654 wrote: »

You obviously do direct your spite though. Straight at any house owner.

No, you have it wrong there. Where did i say to tax the heavens out of any homeowner?
I've argued to withdraw generous tax breaks from landlords which are far superior to that tax break a PPR has called mortgage interest relief.

I only stated a preference of a property tax on PPR's which is fair and based on means but i did say if it was in this thread or another to start taxing multiple home ownership first.

321654 wrote: »

Are you trying to drive prices down so you can buy a house? Or do you just hate people who were able to buy houses (which is what i think most likely)?
Do you think that talking down property will have any effect on the market? Im sorry to tell you it wont. The market will respond to economic forces as it always does everywhere.

Dramatics here or what?

Whats your last paragraph regarding perceptions got to do with the topic?

As explained, economic forces will dictate the direction the market will head. It will be many years before a recovery, we all might be in nursing homes by then

-zaraba wrote:

You are assuming then, that there exists a sufficient housing stock for you to purchase a house to rent out, and there also exists sufficient stock for these 20 people to rent or buy.

Yes there is at present and for the short term. Oversupply in both sales property and rental property is available for those 20 workers.

321654

Can we please get some people who understand economics in here.
Gurramok obviously doesnt and is letting his hatred of anyone people better off than himself show through in every post.

P. Breathnach wrote: »

I do recognise, gurramok, that you are not for turning on this. I have continued posting to pass the time, and have been justifying it to myself on the basis that there might be others reading who are open to persuasion. But I have had enough.

I know. Its painful isnt it.
Whats the point.

gurramok

P. Breathnach wrote:

You appear to want marginal landlords to be forced into capital deficit rather than to survive in business. Should that happen, loan defaults are likely to increase. How might that increase the stability of the banking system? As I already said, you cannot change the past, and you cannot simply reverse transactions that happened one or two or three years ago (I sure there are many people who wish they could).

So lets see. If we go by your position in not weeding out overstretched property investors, we know they are in negative equity and will be for many years and they contribute a portion of their earnings to supplement the rent coming in on their property.

Now, these guys are going to go bust. What you are saying is to delay that bust for some economic miracle to happen around the corner, i'm afraid that will not happen.

What i was saying, do the pain now and our banking system which is the lifeblood of the economy will get through this mess alot quicker.

Would you care to explore the economic effect of such a policy change?

Hint, not every landlord is in difficulty, a hell of alot can afford what they have and run their rentals quite efficiently where a tax of €1,000 would be a drop in the ocean.

321654 wrote:

Gurramok obviously doesnt and is letting his hatred of anyone people better off than himself show through in every post.

Again, wrong perception. I have shown no hatred of anybody in any situation, it seems a couple of posters have the view that they(property investors) should not want to share any of their 'wealth' through a little bit of tax.

Godge

321654 wrote: »

More rubbish.
You cant compare a person buying a property themselves, to you investing investing in a company that creates jobs.

Please compare like with like.

The person buying a house to let it invests in his own business. Effectively creating a business for himself of which he is the only employee.

If you invest in your own business employing only yourself you have exactly the same effect.


And saying investing in a house creates no jobs is a load of bollox too.
Think about what you are saying.

Everything money is spent on is supporting jobs. Right down to the Mars bar you buy on your way to work tomorrow.

Investing in a house that is already built creates no jobs.
Investing in a house that is not built creates some jobs for a short length of time that eventually are unsustainable because you have too much property - sounds like Ireland 2009.

Not everything money is spent on is supporting jobs. And even if it was, some money spent has a greater effect on jobs than other money spent e.g. money spent on a holiday abroad creates jobs abroad rather than in Ireland.

The point I am trying to make is that the tax system should encourage the creation of sustainable jobs in Ireland. We don't need any more property so tax it heavily to introduce a serious disincentive to invest in property and at the same time reduce taxes on income and relaunch business expansion schemes.

The fact that some people were too stupid (and ignorant of economics) to spot a classic asset bubble shouldn't spare them from the pain of correcting our problems.

Godge

321654 wrote: »

Can we please get some people who understand economics in here.
Gurramok obviously doesnt and is letting his hatred of anyone people better off than himself show through in every post.

When people are losing an argument, many of them choose, rather than walking away, to hurl personal insults.

nesf

Godge wrote: »

Investing in a house that is already built creates no jobs.
Investing in a house that is not built creates some jobs for a short length of time that eventually are unsustainable because you have too much property - sounds like Ireland 2009.

Not everything money is spent on is supporting jobs. And even if it was, some money spent has a greater effect on jobs than other money spent e.g. money spent on a holiday abroad creates jobs abroad rather than in Ireland.

The point I am trying to make is that the tax system should encourage the creation of sustainable jobs in Ireland. We don't need any more property so tax it heavily to introduce a serious disincentive to invest in property and at the same time reduce taxes on income and relaunch business expansion schemes.

The fact that some people were too stupid (and ignorant of economics) to spot a classic asset bubble shouldn't spare them from the pain of correcting our problems.

However we do, in the medium term, need to ensure sufficient investment in property to keep the rental market healthy and competitive, so there's no point in taxing it to the ground. The whole law of unintended consequences springs to mind here.

nesf

Godge wrote: »

When people are losing an argument, many of them choose, rather than walking away, to hurl personal insults.

http://www.boards.ie/gathering/tirelessrebutter.jpg tbh

DJDC

The fact that some people were too stupid (and ignorant of economics) to spot a classic asset bubble shouldn't spare them from the pain of correcting our problems.

Quit the superiority complex. The fact is many Irish politicans and bankers saw this boom was starting to self-destruct in 2005/2006 but they didn't have the power(ECB controlling interest rates) or balls(money was too good) to stop it. This kind of boom-bust cycle is going to keep happening as long as the Fed maintain its Keynesian approach towards growth.

blast05

Tax holiday homes as they are a luxury

As are yachts and vintage cars and a thousand other things but they aren't taxed. In my case, property was built with inheritance on which relevant tax was paid plus 2 SSIA's plus savings and there was no cost whatsoever on the state in terms of providing services as previously pointed out - in fact it was another profit for the state as i contributed a few grand to the council of which they did not have to spend as much as a single cent as a consequence of me building. I could have invested it in shares in some company that has nothing to do with Ireland or bought a yacht that would have to be imported ..... but no, pretty much all the money went back into the Irish economy between contrcution materials and labour on which i will be now penalised if the proposals go ahead. Why should this be other than the political need to implement it to satisfy the jealousy of the petty classes ? Or perhaps you can clarify why i should have to pay the proposed tax on this property ?

Property tax on principle primary residence is fine in theory as is property tax on investment properties, again in theory, but its simply unjust to have it on peoples holiday homes or indeed any other luxury items.

andrewdeerpark

DJDC wrote: »

The fact is many Irish politicans and bankers saw this boom was starting to self-destruct in 2005/2006 but they didn't have the power(ECB controlling interest rates) or balls(money was too good) to stop it.

Incorrect, while raising interest rates was not an option they could have used imaginative taxation to discourage investment by professional investors who were able to price first time buyers out of the market.

Its that equity release mortgages and the way these landlords could bundle all their properties together and use the joined up collateral that priced ordinary buyers out of the market.

These same individuals also block booked developments from plans and flipped the house just by paying a booking deposit to turn a handy buck.

The government knew this was going on and did not intervene that is Bertie Ahern's travesty.

Its also why a property tax on professional landlords is required now to ensure this does not happen in future.

Traditional

tax the people even more
what a great country to live in .ha ha

funky.monkey

If the government tried to bring in a property tax at the moment while ordinary people are already finding things so tough, then I think it would provoke a really serious backlash against the government and the state. Esspecially from the lower paid and those on social welfare who simply couldn't afford another sudden expense like 1000 a year property tax.
I would predict a large "Can't Pay / Won't Pay" campaign, and when the property tax demand letters start dropping through letterboxes, people will tear them up and bin them. what will happen next ? Will the government start trying to evict people who refuse to pay ? will we see scenes of families and old ladies being thrown out of their homes onto the street because they can't pay their property tax ? If the government does this then maybe estates will start to organise defence committies to prevent families being evicted, and soon you will have barricades going up at the entrance to estates to prevent them getting in. The government and the state should be careful it doesn't create a situation where ordinary people have nothing left to lose and everything to gain from seeing the collapse of the central governemnt.