Annual Property Tax

http://www.timesonline.co.uk/tol/news/world/ireland/article6350966.ece

The Commission on Taxation is preparing to recommend a new property tax on homes to reduce the state’s reliance on stamp duty. The move could raise about €1 billion in the initial stages, representing an average tax of about €1,000 for homeowners who would be eligible to make the payment.

The_Conductor

Unfortunately its very much a necessary evil. I don't support a blanket tax though- I think it should be gradiated to take two factors into account- Apartment owners in managed complexes who have to pay an annual management charge for services which in many cases are supplied by councils who have taken 'in charge' estates, and 2- the market value of the property- I don't see why Michael Fingleton in his 3.4 million mansion should pay the same as Cait Dubarry, in her 120k 1 bed apartment......

Further- what is the purpose of the tax? If its to benefit the central coffer- as is obviously the case- why not abolish all distributions to local government and allow them to levy whatever they consider the market will bear in their localities. Miss Dubarry in Monasterevin might pay EUR200 a year- while a similar sized apartment in SDCC (Wyckham Way, Dundrum for arguments sake) might attract a 1,500 levy.......

I don't like bringing in the tax- but its an unfortunate reflection of the mess the country is in........

niceirishfella

God I'm really hating my country right now........Grrrrrrrrrrr

Fighting Irish

smccarrick wrote: »

Unfortunately its very much a necessary evil. I don't support a blanket tax though- I think it should be gradiated to take two factors into account- Apartment owners in managed complexes who have to pay an annual management charge for services which in many cases are supplied by councils who have taken 'in charge' estates, and 2- the market value of the property- I don't see why Michael Fingleton in his 3.4 million mansion should pay the same as Cait Dubarry, in her 120k 1 bed apartment......

Cait worked hard, Michael didn't, if this world wasn't full of sh1t Michael should have to pay more

bacon?

ye, i was reading this in metro this morning.....

i seem to remember already paying a whoper of the tax for my house... stamp duty!

a tax on a second investment property, fair enough, but a tax on your main home, this is outrageous! i mean enough allready :mad:

The_Conductor

Fighting Irish wrote: »

Cait worked hard, Michael didn't, if this world wasn't full of sh1t Michael should have to pay more

True. I haven't seen the proposals for this- how do they plan to implement it?

Fighting Irish

smccarrick wrote: »

True. I haven't seen the proposals for this- how do they plan to implement it?

I'm not planning anything because its not up to me :pac:

mrgaa1

In the north the "property tax" is based on what was the value of the house in January 2005 according to the Rates people. This was based on property's in the area of similar size etc... and includes your garage etc...
From talking to friends there they know they have to pay for it as thats the way it is but its an unfair system in that if you have a dormer house as an example you pay the same as someone who may have a two storey near by. The tax is supposed to pay for roads, sewerage, water etc....

My own view is that property tax should be based on volume and its energy rating. Volume because some people have a bungalow, dormer, two storey and some will have added an attic conversion. Based on livable space would be fairer as opposed to house price. In the north - even with the house prices being down - the rates have not changed. In fact they go a percentage each year.
Energy rating should be included because if someone spends €10k on improving their energy efficiency this should be rewarded - a BER cert should suffice.

Property tax on your second home should be increased exponentially. If you are a landlord and own x amount of properties which are being rented out then they should be treated as per your own home.

I think you'll find that the Carbon tax will be linked to property tax - one way of ensuring we all do our bit for the environment.

The_Conductor

mrgaa1 wrote: »

In the north the "property tax" is based on what was the value of the house in January 2005 according to the Rates people. This was based on property's in the area of similar size etc... and includes your garage etc...

Has there been any revision since 2005? If its to be perceived as 'fair' it must keep track of current market values (or at least the perception of them).

mrgaa1 wrote: »

From talking to friends there they know they have to pay for it as thats the way it is but its an unfair system in that if you have a dormer house as an example you pay the same as someone who may have a two storey near by. The tax is supposed to pay for roads, sewerage, water etc....

Its a manner of calculating it- and indeed people have designed houses around it. Its the same way that when tax was calculated on the number of windows- architects mysteriously had massive single windows- chimneys- it became popular to allow smoke dissipitate through thatched roofs (with the side effect that meat could be cured), doors- the whole house became open-plan etc. It doesn't matter how you design the implementation- people will find a way around it.......

mrgaa1 wrote: »

My own view is that property tax should be based on volume and its energy rating.

Volume- certainly- energy rating- I'd be hesitant to go down this road. Its no-one's fault that their pre-2005 dwelling isn't properly insulated. They are already being penalised through higher heating bills. There are 60% SEI grants available for remedial actions- but the 40% can be a deal breaker for a lot of people (particularly in the current climate (no pun on words intended)).

mrgaa1 wrote: »

Volume because some people have a bungalow, dormer, two storey and some will have added an attic conversion. Based on livable space would be fairer as opposed to house price. In the north - even with the house prices being down - the rates have not changed. In fact they go a percentage each year.
Energy rating should be included because if someone spends €10k on improving their energy efficiency this should be rewarded - a BER cert should suffice.

The person isn't spending 10k- the government is spending 6k- they are spending an additional 4k. In a lot of cases properties may not be suitable for retro-fitting insulation etc- should the owner be punished? I agree with you re: a calculation of living space etc. It would also tie in nicely with accurate measurements when buying/selling/renting.... Many estate agents refuse to be tied down to a house's measurements. Its not rocket science guys.......

mrgaa1 wrote: »

Property tax on your second home should be increased exponentially. If you are a landlord and own x amount of properties which are being rented out then they should be treated as per your own home.

Why? With 60% of our vacant housing stock nominally owned by landlords (its amazing what the developers have been allowed to get away with), surely there would be an added imperative to rent the properties at whatever the going-market-rate was- if there was a punitive cost to leaving them vacant? At the moment- if its not generating an income- it doesn't generate a tax liability. I disagree with this on a matter of principle. Ownership should infer an opportunity cost for a landlord (or anyone else), irrespective of the nature of the property.

mrgaa1 wrote: »

I think you'll find that the Carbon tax will be linked to property tax - one way of ensuring we all do our bit for the environment.

Don't bet on it. Recent internal Green Party polls have scared them. People will do their bit- if there is something in it for them. To-date its all a game of take-take-take...... The carbon based VRT and taxation of cars- has made most pre-2007 cars unsaleable in the second hand market at anything other than give-away prices. With the lower VRT on low emitting imports- some savvy dealers are exporting Irish second hand cars to NI and importing the same models from the UK- with lower VRT- for purely tax reasons. This is crazy.

heebusjeebus

If you have already forked out for stamp duty why should you be asked again to pay this annual tax?
I think if you've paid stamp and its the property you live in then you dont pay the tax.

The_Conductor

heebusjeebus wrote: »

If you have already forked out for stamp duty why should you be asked again to pay this annual tax?
I think if you've paid stamp and its the property you live in then you dont pay the tax.

Stamp duty is officially a duty to reflect the costs associated with the registration of property deeds in Dublin Castle. Nothing more, nothing less. That it was allowed turn into a whole different creature is irrelevant. If you go down the road of 'I paid stamp duty so I shouldn't have to pay property tax'- how about- 'I didn't get a FTB grant because my timing was out' and then- 'I didn't pay tax as a FTB, but due to changed financial circumstances I need to rent out my PPR- but I shouldn't pay tax'.......

Its a case of apply it- or don't apply it. We can't have 'opt-out' clauses. Stamp duty is a transaction based tax. The transaction is in the past. Ownership is in the present. If you don't like it- rent instead......

It, among other things- will teach the Irish that property ownership is not the be-all and end-all......

spockety

Technically stamp duty is paid by the seller of a house, not the buyer, I believe?

kmick

spockety wrote: »

Technically stamp duty is paid by the seller of a house, not the buyer, I believe?

You believe wrong - its paid by the buyer. In cases of investment properties CGT is payable by the seller. This property tax sounds like a croc of shti to me. I have paid stamp duty three times in the last decade so why should I be hit again.

Shambo

Another downward influence on house prices then

€1000 per annum is €83 per month after tax.

The_Conductor

Shambo wrote: »

Another downward influence on house prices then

€1000 per annum is €83 per month after tax.

Which would service an additional 25k in mortgage payments- and as a reduction in net after tax income and allowing for a max 30% of net income qualifying towards mortgage payments- is actually closer to a 40k reduction in mortgage affordability- on the national average priced house of 240k- represents a 17% reduction in affordability........

Hmmmmmm

Shambo

smccarrick wrote: »

Which would service an additional 25k in mortgage payments- and as a reduction in net after tax income and allowing for a max 30% of net income qualifying towards mortgage payments- is actually closer to a 40k reduction in mortgage affordability- on the national average priced house of 240k- represents a 17% reduction in affordability........

Hmmmmmm

Along with a few other factors;

Levies
Income tax raises
Salary reductions
Possible reduction in child benefit
Interest rate rises which are sure to happen sooner rather than later.

I hope people who are thinking of buying houses factor in all of the above when making the most imkportant purchase of thier lives.