How about a construction sector tax?

SeanW

Just been thinking - with a €5bn "structural deficit" after the McCarthy report is implemented (I think that was conservative btw and I believe there's a lot more than €5bn/year in wasteful expenditure).

The government now wants to make up €5bn a year in taxes. And of course they want to sock it to the middle and lower classes with property taxes "carbon taxes" and water charges :mad:

Of course the buzzword has been about gov.ie getting a "stable" source of income - i.e. fixed taxes, so that they can keep sending their ministers on junkets and overpaying useless civil servants regardless of the condition of the economy.

Since it's the property developers that creamed it during the bubble and caused much of the distortion, how about making them pay in the future via a construction tax? I.E. all non-infrastructural development be subject to a new tax? To pay for stuff like the bank guarantee.

gurramok

They would pass it onto the consumer, thats why it would be a bad idea. Having a higher CGT on land or even a tax on zoned unserviced land lying idle around the cities would be alot better.

sparklepants

SeanW wrote: »

Just been thinking - with a €5bn "structural deficit" after the McCarthy report is implemented (I think that was conservative btw and I believe there's a lot more than €5bn/year in wasteful expenditure).

The government now wants to make up €5bn a year in taxes. And of course they want to sock it to the middle and lower classes with property taxes "carbon taxes" and water charges :mad:

Of course the buzzword has been about gov.ie getting a "stable" source of income - i.e. fixed taxes, so that they can keep sending their ministers on junkets and overpaying useless civil servants regardless of the condition of the economy.

Since it's the property developers that creamed it during the bubble and caused much of the distortion, how about making them pay in the future via a construction tax? I.E. all non-infrastructural development be subject to a new tax? To pay for stuff like the bank guarantee.

That would be the exact same as stamp duty, as it would ultimately be paid for by the buyer. Reliance on construction-related taxes is exactly what we don't need, and is a major part of the reason that we're in the state we're in.

Moriarty

Great way to make an extra 30 euros this year anyway.

RealityCheck

SeanW wrote: »

Since it's the property developers that creamed it during the bubble and caused much of the distortion, how about making them pay in the future via a construction tax? I.E. all non-infrastructural development be subject to a new tax? To pay for stuff like the bank guarantee.

Probably a bit of a non runner since they are all broke, but yes it would have been a good idea in the good times as it would have slowed down the boom and prevented the disasterous consequences that have occured.

The way I see it is that the domestic construction industry is finished for at least the next ten years so the idea really has no future. Many dont realise that it is highly unlikely that there will a consumer driven housing boom any time in the next ten years.

Infact its the Irish taxpayer that has to pay for their greedy past through the NAMA vehicle which leave the country with a burden of debt for our future generations to deal with. Its really too late to talk about screwing the property developers. They have already well and truely screwed us up.

Slumlion

SeanW wrote: »

Just been thinking - with a €5bn "structural deficit" after the McCarthy report is implemented (I think that was conservative btw and I believe there's a lot more than €5bn/year in wasteful expenditure).

The government now wants to make up €5bn a year in taxes. And of course they want to sock it to the middle and lower classes with property taxes "carbon taxes" and water charges :mad:

Of course the buzzword has been about gov.ie getting a "stable" source of income - i.e. fixed taxes, so that they can keep sending their ministers on junkets and overpaying useless civil servants regardless of the condition of the economy.

Since it's the property developers that creamed it during the bubble and caused much of the distortion, how about making them pay in the future via a construction tax? I.E. all non-infrastructural development be subject to a new tax? To pay for stuff like the bank guarantee.

If only you had of thought of that idea 6 years ago,the construction sector must be BOOMING in longford.
Hilarious.

thebman

Better off taxing people for sitting on idle property to force house prices and renting particularly of commercial property to their proper level.

Have the inevitable fire sale, allow whatever developers are going to go bankrupt to do so and hopefully allow us to focus on getting our actual economy going.

SeanW

gurramok wrote: »

They would pass it onto the consumer, thats why it would be a bad idea.

No, I was thinking of putting a levy on property developers profits, rather than the actual sales, so that it comes out of the developers margin.

Having a higher CGT on land or even a tax on zoned unserviced land lying idle around the cities would be alot better.

thebman wrote: »

Better off taxing people for sitting on idle property to force house prices and renting particularly of commercial property to their proper level.

Have the inevitable fire sale, allow whatever developers are going to go bankrupt to do so and hopefully allow us to focus on getting our actual economy going.

These sound like better ideas.

turgon

SeanW wrote: »

No, I was thinking of putting a levy on property developers profits, rather than the actual sales, so that it comes out of the developers margin.

Then wouldn't the developers just increase their profits by increasing the price?

Joey the lips

Stupid proposal.its stimulating building we need!

By the way the worst is still yet to come!

I guarantee you by the end owning a house will be the last thing on our kids mind

diverdriver

When are people going to realise that ultimately all taxes are paid by you and me. I'm self employed any tax I pay comes from the people who pay me which in turn comes from their customers. If I didn't have to pay tax. I would be paid less because I would need less.

Talk about turkeys voting for Christmas:rolleyes:

But you are right about water taxes, property taxes and carbon taxes. Carbon taxes are probably the most odious of all. A sop to the greens and easily the most useless way of saving the planet ever.

thebman

Well we all know raising taxes will just harm the economy even more but what choice does the state have when the alternative appears to be bankruptcy?

RealityCheck

thebman wrote: »

Well we all know raising taxes will just harm the economy even more but what choice does the state have when the alternative appears to be bankruptcy?

Rule one of how to run an economy: Reduce taxes in the bad times raise taxes in the good times.

Rule one of how to run the Irish economy (FF style): Reduce taxes in the good times so as to stay popular and keep in power for 12 years unoppossed, and increase taxes in the bad times to stave off bankruptcy.

Hopefully we never make that mistake again....:rolleyes:

johnnyc

Joey the lips wrote: »

By the way the worst is still yet to come!

Have to agree with you, I recon that in a decade or 2 people will say 2009 was a good year compared to the years that followed?

MG

Moriarty wrote: »

Great way to make an extra 30 euros this year anyway.

After they go into examinership, we'd probably only get 5c in the Euro.

SeanW

turgon wrote: »

Then wouldn't the developers just increase their profits by increasing the price?

Joey the lips wrote: »

Stupid proposal.its stimulating building we need!

The developers couldn't increase their prices because there is an oversupply of property. Market forces are demanding the downward spiral prices are on.

And why would we need to stimulate building when there is excess supply and prices are under downward pressure?

Well we all know raising taxes will just harm the economy even more but what choice does the state have when the alternative appears to be bankruptcy?

Cut spending. The McCarthy report was a good start but I'm sure there's even more stuff that could be axed or reduced without too much pain. Then, as a last resort, increase some existing taxes in preference to creating new ones.

Bren1609

There already is on it's called Relvenat Contracts Tax. Increasing taxes is not the answer.