Property tax, how is it likely to implemented?

Freiheit

Am I the only one scared by reports yesterday of a forthcoming property tax of on average E1000 per year? which if you can't afford it will be procured 'later' , if not in life then on death?. Sounds terribly draconian as income doesn't appear to be considered, rather site value alone. This to pay for the profligate banks which weren't our burden to begin with.

Sad, worried and mad.:mad:

Cookie_Monster

The sooner the better tbh, the last thing we need is more income taxes and the money has to come from somewhere.

Site value is the wrong way to do it though and should be based on sq metres.

RichardAnd

I don't agree with the principal of property tax as it's another one of those iffy tax methodologies like wealth tax. Then again, I don't think excessive taxing is right in any way shape or form but I guess it's here to stay.

Methinks the property tax will be collected like TV liences (another baseless tax).

flanzer

I'm thinking, anyone who has paid stamp duty on their current house/home will be exempt

Welease

Cookie_Monster wrote: »

Site value is the wrong way to do it though and should be based on sq metres.

Why? I think there are many pro's and con's to each system.. The obvious flaw in sq m. is that we are saying a 100sq/m site in Leitrim with no water/sewerage/gas mains/transport services should pay more than a 95sq/m site in D4? Seems a tad unfair doesnt it?

macannrb

the government badly needs cash, and they will come up with plenty of ways of doing it. So this property tax will come, when is another question

RichardAnd

macannrb wrote: »

the government badly needs cash, and they will come up with plenty of ways of doing it. So this property tax will come, when is another question

Pretty much. So long as they don't tax childrens' shoes, anything is up for grabs :rolleyes:

catbear

I think in the last budget stamp duty was greatly reduced as to being worth very little to the government compared to the bubble era, that's just the visible shift away from one off tax to annual tax. As another poster said I think that recent purchasers will probably be given a reduction. It sounds unfair I know but then society should never have tolerated gazzumping ten years ago.

bigwormbundoran

Welease wrote: »

Why? I think there are many pro's and con's to each system.. The obvious flaw in sq m. is that we are saying a 100sq/m site in Leitrim with no water/sewerage/gas mains/transport services should pay more than a 95sq/m site in D4? Seems a tad unfair doesnt it?

I was just about to say the very same, though seeing as the residents of the more affluent areas are likely to hold more power over the government they in turn will be more likely to introduce the sq/m measure. Theyll easily get away with it by saying its alot easier to just measure it up than to value it to an agreeable interpretation of what its worth. Though a set sq/m value for each area could also be done I suppose, one can but wait and see.

dan_d

Welease wrote: »

Why? I think there are many pro's and con's to each system.. The obvious flaw in sq m. is that we are saying a 100sq/m site in Leitrim with no water/sewerage/gas mains/transport services should pay more than a 95sq/m site in D4? Seems a tad unfair doesnt it?

Well, that's ok until you find a situation whereby the valuations fly through the roof. The square meterage is a fixed constant (in that it will only change if people make a conscious decision to extend, knowing the consequences), whereas the site valuation is at the mercy of the fluctuations of the market. Given the behaviour of all involved in the sale of property in the last decade, I for one would be extremely unhappy to be paying any tax like this, and wholly against it. Taxes should be based on fixed constants such as square meterage.Like the stamp duty, basing a tax on the site valuation would just bring money rolling into the Gov coffers at the whim of estate agents, and we've all seen how that worked out...it caused them to stoke the property fire higher and higher and higher.

No. Definitely not a good idea to base it on valuations, even just based on past performance of politicians and Government alone.

Cookie_Monster

Welease wrote: »

Why? I think there are many pro's and con's to each system.. The obvious flaw in sq m. is that we are saying a 100sq/m site in Leitrim with no water/sewerage/gas mains/transport services should pay more than a 95sq/m site in D4? Seems a tad unfair doesnt it?

because site value is a totally false figure (as the last ten years have shown, some random figure will just be slapped on a site with little or no justification) whereas sq.m is comparable everywhere.

To compensate fo rthe rural urban divide you could have rates per sq m. x density factors so those living in high pop densities pay less due to more efficient usage of provided services, with one of housing in the middle of nowhere paying higher rates for being much less sustainably and costly to supply.

Welease

dan_d wrote: »

Well, that's ok until you find a situation whereby the valuations fly through the roof. The square meterage is a fixed constant (in that it will only change if people make a conscious decision to extend, knowing the consequences), whereas the site valuation is at the mercy of the fluctuations of the market. Given the behaviour of all involved in the sale of property in the last decade, I for one would be extremely unhappy to be paying any tax like this, and wholly against it. Taxes should be based on fixed constants such as square meterage.Like the stamp duty, basing a tax on the site valuation would just bring money rolling into the Gov coffers at the whim of estate agents, and we've all seen how that worked out...it caused them to stoke the property fire higher and higher and higher.

No. Definitely not a good idea to base it on valuations, even just based on past performance of politicians and Government alone.

But you could model it on the UK system, whereby the site valuation is a fixed point in time.. Which in the UK, I think (would need to check) was 1988.. Any new builds are valued in relation to existing building in 1988 ti ascertain their valuation.. The last house I sold in the UK was sold to £250,000.. but its Council Tax valuation was £70,000.

jester77

Welease wrote: »

Why? I think there are many pro's and con's to each system.. The obvious flaw in sq m. is that we are saying a 100sq/m site in Leitrim with no water/sewerage/gas mains/transport services should pay more than a 95sq/m site in D4? Seems a tad unfair doesnt it?

Tax per sq meter is fair, but the cost of the sq meter should be based on location.

Either way, I don't agree with property tax on your main residence. The average person will burst their ass working for 20+ years just to pay off their mortgage, and that should be it. Let a person retire with the knowledge that they have their home and only paying their utilities to worry about. I would have no problem with tax on secondary properties.

Welease

Cookie_Monster wrote: »

because site value is a totally false figure (as the last ten years have shown, some random figure will just be slapped on a site with little or no justification) whereas sq.m is comparable everywhere.

To compensate fo rthe rural urban divide you could have rates per sq m. x density factors so those living in high pop densities pay less due to more efficient usage of provided services, with one of housing in the middle of nowhere paying higher rates for being much less sustainably and costly to supply.

But sq m isnt comparable everywhere if you dont have services and the cost of the site was a fraction of another site..
As per my other response, we could use the UK system which although it uses a site valuation doesnt allow for boom/bust "real" prices.

Sorry meant to add.. I think part of the problem with ANY Irish system is its not clear what the taxes will be used for.. The UK system is far clearer, my taxes pay for the police, street lighting, bins, council services etc. .. so the cost to me is very much a function of the services I may receive.. that likely won't be the case in Ireland.

danbohan

jester77 wrote: »

Tax per sq meter is fair, but the cost of the sq meter should be based on location.

Either way, I don't agree with property tax on your main residence. The average person will burst their ass working for 20+ years just to pay off their mortgage, and that should be it. Let a person retire with the knowledge that they have their home and only paying their utilities to worry about. I would have no problem with tax on secondary properties.

The average person will burst their ass working for 20+ years just to pay off their mortgage

the average person in most countrys in the world do the same , they still have to pay a property tax i know i do , so why should it be different in ireland ?

sarumite

Cookie_Monster wrote: »

because site value is a totally false figure (as the last ten years have shown, some random figure will just be slapped on a site with little or no justification)whereas sq.m is comparable everywhere.

To compensate fo rthe rural urban divide you could have rates per sq m. x density factors so those living in high pop densities pay less due to more efficient usage of provided services, with one of housing in the middle of nowhere paying higher rates for being much less sustainably and costly to supply.

A sq.m in D4 is hardly comparable to a sq.m in Leitrim to be fair. Its the same argument people made when Tatcher introduced the poll tax. While it was comparable, it certainly wasn't fair. I don't know how they will do it, but several factors should be considered inlcuding size and valuation.

steve9859

It annoys me that only property owners are singled out. Everyone should pay, like the council tax in the UK, whether you rent or own. What you pay is based on the value of the property in which you live (in very straightforward value bands that you can find on-line). So if you are renting and you cant afford the tax, them move to a lower value property in a cheaper part of town

As for the point about how it should be calculated, it will only be workable if it is as simple as possible, so that people know what they are getting into when they move house. Just a handful of price bands, irrespective of location or anything else.

Cookie_Monster

sarumite wrote: »

A sq.m in D4 is hardly comparable to a sq.m in Leitrim to be fair.

that's why I said multiply it by a density factor to equate them giving (say) 5 bands of tax per sq m

sarumite

steve9859 wrote: »

It annoys me that only property owners are singled out. Everyone should pay, like the council tax in the UK, whether you rent or own.

In the UK, council tax is directed towards property itself. The owner passes the tax onto the tenants. I don't see why it would be any different here.

ednwireland

Freiheit wrote: »

Am I the only one scared by reports yesterday of a forthcoming property tax of on average E1000 per year? which if you can't afford it will be procured 'later' , if not in life then on death?. Sounds terribly draconian as income doesn't appear to be considered, rather site value alone. This to pay for the profligate banks which weren't our burden to begin with.

Sad, worried and mad.:mad:

they come round with a bin, you empty your wallet into, they carry on providing as few services as possible and paying themselves huge salaries (compared to me) for not providing those services.

actually i wouldnt have a problem paying a 1000 euro a year if i got something tangibble for that, currently i have private water , pay for my bins, the roads are rarely repaired - hold on thats the road fund what tdo the councils do here anyway

sollar

I'm terrified that the power will be given to local authorities to charge what they like for property tax. Our county council doubled recycling costs in the middle of a resession and now they have problems with fly tipping. They haven't got the first clue about what people can and can't afford.

Also, how are fine gael going to charge the 2004 to 2008 NE bridage a property tax when they were going to give them extra relief a few months ago?? No doubt people on social welfare won't have to pay either so who is going to pay??

Cool Mo D

A site value tax (which would not include the value of the buildings, only the site) is the fairest way for many, many reasons.

- It encourages people to make efficient use of the land, and punishes landowners who let their sites fall into dereliction (a huge issue in Ireland's cities) while building up a land bank.

- It will increase densities in our cities and towns to be more sustainable, as making more use of your land carries no tax penalty.

- It makes the development of expensive public transport infrastructure way easier. For example, 10 years ago, it cost £6 billion for London to build the Jubilee line tube extension. The goverment have no obvious way of getting that back, until you realise that the value of sites around the extension has risen £15 billion. A site value tax means that capital intensive public projects can pay for themselves.

- It does not punish farmers, rural dwellers, and those who live on and own marginal land unfairly for owning large areas of land.

- It is proven not to distort the economy to favour any particular group.

The only disadvantage (and it is a serious one), is figuring out what a fair site value is. The most accurate way would be to take the selling price of a new build house/office block, and subtract the cost of building the structure, and taking the rest as the site value.

There was in fact a political movement called Georgism, very influential at the turn of the 20th century, which was devoted to replacing all other taxes with a land value tax, although it has fallen out of common knowledge.

whiteonion

Most civilised countries have property taxes, why should Ireland be any different?

sollar

whiteonion wrote: »

Most civilised countries have property taxes, why should Ireland be any different?

FF should have left rates in place back in the 70's and this country would have been saved alot of heartache.

Rabble Rabble

Cookie_Monster wrote: »

that's why I said multiply it by a density factor to equate them giving (say) 5 bands of tax per sq m

Thats the dumbest property tax ever. You would tax a property worth €100K 5 times more than a d4 property worth €1M.

Nonsense, we can value propertys based on the local prices and tax accordingly. Dublin needs to be taxed much higher than the country anyway as it takes most of the resources.

sarumite

Rabble Rabble wrote: »

Dublin needs to be taxed much higher than the country anyway as it takes most of the resources.

I am going to quote you on this suggestion.

Rabble Rabble wrote: »

Thats the dumbest property tax ever.

robd

Cool Mo D wrote: »

A site value tax (which would not include the value of the buildings, only the site) is the fairest way for many, many reasons.

- It encourages people to make efficient use of the land, and punishes landowners who let their sites fall into dereliction (a huge issue in Ireland's cities) while building up a land bank.

- It will increase densities in our cities and towns to be more sustainable, as making more use of your land carries no tax penalty.

- It makes the development of expensive public transport infrastructure way easier. For example, 10 years ago, it cost £6 billion for London to build the Jubilee line tube extension. The goverment have no obvious way of getting that back, until you realise that the value of sites around the extension has risen £15 billion. A site value tax means that capital intensive public projects can pay for themselves.

- It does not punish farmers, rural dwellers, and those who live on and own marginal land unfairly for owning large areas of land.

- It is proven not to distort the economy to favour any particular group.

The only disadvantage (and it is a serious one), is figuring out what a fair site value is. The most accurate way would be to take the selling price of a new build house/office block, and subtract the cost of building the structure, and taking the rest as the site value.

There was in fact a political movement called Georgism, very influential at the turn of the 20th century, which was devoted to replacing all other taxes with a land value tax, although it has fallen out of common knowledge.

This is the first post in this thread which correctly outlines what a site valuation vs a property tax actually is.

Plenty of reading at http://en.wikipedia.org/wiki/Site_valuation_tax also.

To answer some previous misunderstandings in other posters posts.

Site valuation takes account of the size of the site and the location of the site. I wouldn't expect EA's to value each site. There is already details of site in the stamp databases, hence I would expect the government to pick a target revenue then divide it by the total sqm of all sites. There is no difference between owning and renting from a government revenue perspective. You're either an owner occupier or a landlord and you pay the tax.

The really good thing about site valuation vs property valuation is that it is by it's nature an eco tax. It encourages sites to be developed fully. Apartments would pay much much less than a 4 bed detached house with nice gardens front and back. You don't get penalized for doing it up and adding extensions etc. There's account taken of proximity to city and public transport access. It encourages older people to trade down, freeing up bigger accommodation for families. It discourages hoarding of unused properties.

RichardAnd

Rabble Rabble wrote: »

Thats the dumbest property tax ever. You would tax a property worth €100K 5 times more than a d4 property worth €1M.

Nonsense, we can value propertys based on the local prices and tax accordingly. Dublin needs to be taxed much higher than the country anyway as it takes most of the resources.

Interesting synopsis but sadly, that's not how taxes work. I pay income tax to fund child benefit yet I have no children. I contribute education yet I have no use for it personally. My taxes also go to fun social carers yet I know of no one who avails of their services. You do this too and whilst it probably isn't fair, it's just the way things work.

Tigger

Cookie_Monster wrote: »

because site value is a totally false figure (as the last ten years have shown, some random figure will just be slapped on a site with little or no justification) whereas sq.m is comparable everywhere.

To compensate fo rthe rural urban divide you could have rates per sq m. x density factors so those living in high pop densities pay less due to more efficient usage of provided services, with one of housing in the middle of nowhere paying higher rates for being much less sustainably and costly to supply.

like busses and trains ?
i pay for my water and my roads are a joke
why should i pay more

Merch

Rabble Rabble wrote: »

Thats the dumbest property tax ever. You would tax a property worth €100K 5 times more than a d4 property worth €1M.

Nonsense, we can value propertys based on the local prices and tax accordingly. Dublin needs to be taxed much higher than the country anyway as it takes most of the resources.

My God!? all of it, based on the values of property when we still have unrealistic values currently?
As someone else said, if a service was to be provided to say some remote town in the country, the cost would be significantly greater.
I would say isolated, in particular individual settlements are less sustainable in many ways than higher density settlements, because services (where they exist in, wether in either rural or urban areas) are more cost effective to run for a larger population, it seems as if you are suggesting ahh shure those up in Dublin type of thing???

I'm not trying to criticise people from rural Ireland, whether townies or not, just pointing out what seems obvious to me

gigino

People who paid 9% stamp duty have already paid a fortune in property tax, sometimes equivalent to a years salary or more in one lump sum.

Introducing another property tax will only depress the property market more, which will mean more people will default, more people cannot sell etc - and the banks will need more money as a result.


The more the property market is allowed - or forced - to collapse, the more help / aid / bailout the banks will need. If people are afraid to spend money on houses or house improvements, more people become unemployed.

The government should first control spending to at least European levels.

Rabble Rabble

Merch wrote: »

My God!? all of it, based on the values of property when we still have unrealistic values currently?
As someone else said, if a service was to be provided to say some remote town in the country, the cost would be significantly greater.
I would say isolated, in particular individual settlements are less sustainable in many ways than higher density settlements, because services (where they exist in, wether in either rural or urban areas) are more cost effective to run for a larger population, it seems as if you are suggesting ahh shure those up in Dublin type of thing???

I'm not trying to criticise people from rural Ireland, whether townies or not, just pointing out what seems obvious to me

Rubbish. Property taxes are wealth taxes. Country people pay for their water and refuse etc. unlike Dubliners - who leech off the system for water. There are separate charges already for services provided by the local councils. This is about transferring wealth.

So if you live in the more expensive house, you pay the more expensive tax. Thats what a property tax is, anything else is a poll tax.

So in the British system you pay more in central London, than in Wales. Or the Isle of Skye.

( This is remedial by the way).

If you cant afford it, sell up and move.

Merch

Rabble Rabble wrote: »

Rubbish. Property taxes are wealth taxes. Country people pay for their water and refuse etc. unlike Dubliners - who leech off the system for water. There are separate charges already for services provided by the local councils. This is about transferring wealth.

So if you live in the more expensive house, you pay the more expensive tax. Thats what a property tax is, anything else is a poll tax.

So in the British system you pay more in central London, than in Wales. Or the Isle of Skye.

( This is remedial by the way).

If you cant afford it, sell up and move.

? you seem to have some grudge to bear?? I haven't said if I consider a property tax a wealth tax or not?
Whats all this about Dubliners leeching?? look that kind of talk is just silly to me, the system is currently that we dont pay, does that mean I dont try to conserve water? no it doesnt.
I have to say I think there should be a more common and fairer system for water and waste charges throughout the country but this is to do with local councils and not individuals/families that happen to live in different counties. I'd be pro water charges if I thought it wouldnt turn into a jobs for the boys, bureaucratic mess/waste of money.

Im not sure where you are coming in with the last line? who can afford to sell up and leave, Im not too keen on property taxes.

What I have said was I agree with the poster that suggested value a property on its floor area, rather than market value.

You seem to have some kind of grudge to bear against people living in Dublin? I dont know why but a general dislike of people living in a certain area seems kinda immature

conorhal

I loathe the idea of property taxes. It feels far too much like renting your own home from the government.

If they must be implimented then there is only one fair way to do so in my opinion. A tax based on the sale price of a property.

This was the solution settled on in parts of California after it was decided that property taxes on many, often elderly people, that had bought homes at reasonable prices were being forced from their homes because they were suddenly unable to afford to pay the taxes on the home they had lived in for years simply because the 'low rent district' they had lived in all their lives had suddenly becoming 'fashionable'.
My folks bought their home for something like 6 thousand pounds. At the hight of the boom a neighbour was trying to sell their house for close to 700 grand (post bust it actually sold for 350 grand).
As a retired elderly couple with a small pension it seems unfair to apply punitatve rates for tax due to appreciation, their home is not a revenue generating asset, so a tax based on the cost of the sale price seems to be the only fair way to proceed.
Should my folks sell up, the house would then be taxed at the new sale price for the next occupant (or the valuation price if a relative inherits it).

If the tax is based on the sale price one can assume that the purchaser has an income in line with the value of the property and can take the tax cost of the value of the home into consideration when they make the decision to buy.

ei.sdraob

Cookie_Monster wrote: »

because site value is a totally false figure (as the last ten years have shown, some random figure will just be slapped on a site with little or no justification) whereas sq.m is comparable everywhere.

To compensate fo rthe rural urban divide you could have rates per sq m. x density factors so those living in high pop densities pay less due to more efficient usage of provided services, with one of housing in the middle of nowhere paying higher rates for being much less sustainably and costly to supply.

People in the country side do pay more for services, that includes bins, water, electricity and yes roads via road taxes and higher fuel usage
and so on

ardmacha

It feels far too much like renting your own home from the government.

Complete nonsense. There is an annual tax on my car, I do not feel that this is renting my car to the government.

As to elderly people, don't make them move, in such cases allow the tax be rolled up until the house is sold. Property taxes need not be huge, an average of €1000/year would only entail an accumulation of €20,000-€25,000 or so on a pensioners house, still a small enough fraction of its value.

Such arrangements should be combined with some allowance for people who paid stamp duty in the last 10 years.

Cookie_Monster

Rabble Rabble wrote: »

Property taxes are wealth taxes.

all taxes are wealth taxes


@conorhal

That will just lead to all sorts of dodgy dealing in declaring the selling/purchasing price price. How do you determine the tax due on a house that has changed ownership but has not been sold (inheritance). How do you effectively calculate and up to date tax rate on a property last sold 100 years ago say?
I think it would lead to a lot of issues, say you have a street of 10 house, all same size and spec and each was sold in a different year, so all would end up at different rates despite being worth effectively the same now and being the same size.

robd

conorhal wrote: »

I loathe the idea of property taxes. It feels far too much like renting your own home from the government.

If they must be implimented then there is only one fair way to do so in my opinion. A tax based on the sale price of a property.

This was the solution settled on in parts of California after it was decided that property taxes on many, often elderly people, that had bought homes at reasonable prices were being forced from their homes because they were suddenly unable to afford to pay the taxes on the home they had lived in for years simply because the 'low rent district' they had lived in all their lives had suddenly becoming 'fashionable'.
My folks bought their home for something like 6 thousand pounds. At the hight of the boom a neighbour was trying to sell their house for close to 700 grand (post bust it actually sold for 350 grand).
As a retired elderly couple with a small pension it seems unfair to apply punitatve rates for tax due to appreciation, their home is not a revenue generating asset, so a tax based on the cost of the sale price seems to be the only fair way to proceed.
Should my folks sell up, the house would then be taxed at the new sale price for the next occupant (or the valuation price if a relative inherits it).

If the tax is based on the sale price one can assume that the purchaser has an income in line with the value of the property and can take the tax cost of the value of the home into consideration when they make the decision to buy.

This is a frustrating thread. The proposed tax is a site valuation tax, not a property tax. The home itself wouldn't come in to it and the site valuation would not be subject to fluctuations as seen in recent times as it would be linked to CPI. Please go and read how site valuation tax works. http://en.wikipedia.org/wiki/Land_value_tax

The only people who may be displaced would be those sitting on a little detached house with a huge garden. Given we've reached peak oil and the price of fuel is only going one way, this is ecologically sound, as we wish to discourage this type of under development.

ei.sdraob

robd wrote: »

Given we've reached peak oil

When seems like i missed the memo

robd wrote: »

and the price of fuel houses is only going one way

FYP

conorhal

Cookie_Monster wrote: »

all taxes are wealth taxes


@conorhal

That will just lead to all sorts of dodgy dealing in declaring the selling/purchasing price price. How do you determine the tax due on a house that has changed ownership but has not been sold (inheritance). How do you effectively calculate and up to date tax rate on a property last sold 100 years ago say?
I think it would lead to a lot of issues, say you have a street of 10 house, all same size and spec and each was sold in a different year, so all would end up at different rates despite being worth effectively the same now and being the same size.

Well the sale price seems to me to be an effective means of valuation. I can't see it being subject to any more dodgy dealing then having an auctioneer do it, who might shave a few grand off a valuation for sombody.
In the case of inheritance, as I said, when deeds or ownership is transfered then a valuation must take place citing the current value of the house. All valuation takes place when a property transfers ownership, because at that point a house is a liquid asset.
I would add one clause, that if the inheritor is a current occupant of the house for X peroid of time (thus it's their home rather then an inherited asset) then the valuation should be 50% original value and 50% current value. This would be a recognition for the kinds of people like my folks poor neighbor that spent 15yrs caring for her elderly parents, didn't work and had never married. It would be a shame to see sombody like that unable to afford to continue living in their own home.

I'm utterly unconcerned if that leads to different tax evaluations on one street, I'm talking about a fair assesment of ability to pay and ensuring that people can keep their homes, also it ensures that communities can stay together, thats an important social and societal aspect that a blunt current value property tax ignores. Current value or square footage are just arbitrarty, look at the celtic tiger years did for the meaning of such methods of valuation.

conorhal

robd wrote: »

This is a frustrating thread. The proposed tax is a site valuation tax, not a property tax. The home itself wouldn't come in to it and the site valuation would not be subject to fluctuations as seen in recent times as it would be linked to CPI. Please go and read how site valuation tax works. http://en.wikipedia.org/wiki/Land_value_tax

The only people who may be displaced would be those sitting on a little detached house with a huge garden. Given we've reached peak oil and the price of fuel is only going one way, this is ecologically sound, as we wish to discourage this type of under development.

And I'm proposing an alternative, problem?

So as long as we're chucking people out of their homes for ecologically sound reasons that ok then? We should probably also beat them with the rubber hose that they used to water that garden with I suppose...:rolleyes:

ei.sdraob

conorhal wrote: »

So as long as we're chucking people out of their homes for ecologically sound reasons that ok then?

Green politics taken to its grim conclusion

robd

conorhal wrote: »

And I'm proposing an alternative, problem?

Which is complete rubbish. It's no different than stamp duty, in that it's a tax on the transaction, which is subject to huge fluctuations (in volumes) like we've just seen. Hence our tax base was debased and we ended up with a monstrous deficit. Did you miss that? The whole idea of moving to a site valuation tax is that it would bring a constant amount of revenue per year.

I'll shut up about the ecological side of it as it's distracting from the main point really.

conorhal

robd wrote: »

Which is complete rubbish. It's no different than stamp duty, in that it's a tax on the transaction, which is subject to huge fluctuations (in volumes) like we've just seen. Hence our tax base was debased and we ended up with a monstrous deficit. Did you miss that? The whole idea of moving to a site valuation tax is that it would bring a constant amount of revenue per year.

I'll shut up about the ecological side of it as it's distracting from the main point really.

I think you misunderstand what I'm proposing. It's nothing like stamp duty, because unlike stamp duty it would be an annual tax not a once off payment, the value of which is based on the transaction, and it would be a very stable and predictable revenue base precisely because it is NOT subject to wild fluctuations, simply because the revenue generated by an area is the aggegate value of existing property taxes, and that doesn't change a lot because only a few houses will be sold in a given area in any particular year. Thus the tax take in an area will be not subject to property bubble fluctuations (or crashes), and the people in the area will not be at the mercy of trends like the gentrification or a property bubble rapidly inflating the value of their modest home and forcing them out.

robd

conorhal wrote: »

I think you misunderstand what I'm proposing. It's nothing like stamp duty, because unlike stamp duty it would be an annual tax not a once off payment, the value of which is based on the transaction, and it would be a very stable and predictable revenue base precisely because it is NOT subject to wild fluctuations, simply because the revenue generated by an area is the aggegate value of existing property taxes, and that doesn't change a lot because only a few houses will be sold in a given area in any particular year. Thus the tax take in an area will be not subject to property bubble fluctuations (or crashes), and the people in the area will not be at the mercy of trends like the gentrification or a property bubble rapidly inflating the value of their modest home and forcing them out.

OK, I did misunderstand.

However, your idea is not properly thought out, and overly complex to implement when you go to implement it. Every property is different, different size, different number of beds, semi-d, detached apartment etc. You'd end up having to create baskets of properties and do all sorts of things in terms of weighting to come up with a fare average. Then someone buys that lovely detached house on 1 acre, knocks it down and builds 100 apartments, completing skewing the calcs. It would cost a fortune to implement and would be constantly interfered with for political gain.

Site valuation based on the sqm of the land is the way to go. The winners, apartment holders, the losers, owners of large detached houses. Of course, what happens to the crap Edwardian 2-up 2-down houses? The preservations societies are going to have a fit. Our preservation system is over zealous though. We need to better preserve the really great stuff and get rid of the crap.

conorhal

robd wrote: »

OK, I did misunderstand.

However, your idea is not properly thought out, and overly complex to implement when you go to implement it. Every property is different, different size, different number of beds, semi-d, detached apartment etc. You'd end up having to create baskets of properties and do all sorts of things in terms of weighting to come up with a fare average. Then someone buys that lovely detached house on 1 acre, knocks it down and builds 100 apartments, completing skewing the calcs. It would cost a fortune to implement and would be constantly interfered with for political gain.

Site valuation based on the sqm of the land is the way to go. The winners, apartment holders, the losers, owners of large detached houses. Of course, what happens to the crap Edwardian 2-up 2-down houses? The preservations societies are going to have a fit. Our preservation system is over zealous though. We need to better preserve the really great stuff and get rid of the crap.

I think it would be very easy to implement as it would use the same basic structure as stamp duty which is already in place.
Instead of being issued a demand for stamp duty when you buy a house, you are instead issued with an annual tax demand using bands (like stamp duty) based on how much you paid to calculate the amount of tax due.
In this scenario, my folks that paid 6 grand would pay tax in the, say, 1 -50,000 euro bracket, thus ensuring that people that have lived in an area for 40yrs and are retired are not burdened with excessive demands or forced to move out of a home and a community that they have built their lives in.
If they sell the house or a family member inherits it, a requirement for transferring the deeds is to register the sale price or property value and a demand is issued on the basis of that price. If the new owner can afford to buy the house at it's current value then I assume that they can afford the taxation that goes with that value (say a 250 to 350 grand band).
I think it's a simple elegant and socially inclusive method.

Your proposal is ideologically motivated and only concerned with one single issue enviornmentalism. Policy based on such single issue medeling and social engineering can only lead to disaster, and whenever I hear greens talking about how they would solve ecological problems, they all tend to sound like they are proposing the green equivalent of Mao's 'Great Leap Forward', and look at how that turned out.

robd

conorhal wrote: »

I think it would be very easy to implement as it would use the same basic structure as stamp duty which is already in place.
Instead of being issued a demand for stamp duty when you buy a house, you are instead issued with an annual tax demand using bands (like stamp duty) based on how much you paid to calculate the amount of tax due.
In this scenario, my folks that paid 6 grand would pay tax in the, say, 1 -50,000 euro bracket, thus ensuring that people that have lived in an area for 40yrs and are retired are not burdened with excessive demands or forced to move out of a home and a community that they have built their lives in.
If they sell the house or a family member inherits it, a requirement for transferring the deeds is to register the sale price or property value and a demand is issued on the basis of that price. If the new owner can afford to buy the house at it's current value then I assume that they can afford the taxation that goes with that value (say a 250 to 350 grand band).
I think it's a simple elegant and socially inclusive method.

Your proposal is ideologically motivated and only concerned with one single issue enviornmentalism. Policy based on such single issue medeling and social engineering can only lead to disaster, and whenever I hear greens talking about how they would solve ecological problems, they all tend to sound like they are proposing the green equivalent of Mao's 'Great Leap Forward', and look at how that turned out.

Let me be very clear. I couldn't give a flying f about the environment. I'm only interested in the economic affect of peaking energy and commodity production, which is intrinsically tied to the environment. Peak oil discoveries we're 40 years ago and it's becoming increasingly expensive to tap oil reserves and mine coal, iron ore, copper etc. This is pushing up the price of absolutely everything, and will over time push up the price of credit as that to is linked. The days of living in draughty big old houses is coming to and end basically, not for idealistic reasons but for pure financial reasons.

Any tax needs to realise this, and encourage a move in the right direction, otherwise as a society we are just sticking our heads in the sand.

As regards your parents living in a house that they paid 6 grand for. They're probably retired with a nice nest egg, thus they're nice and plump with regards to taxation. Their income is low but their accumulated wealth is high, compared to the current generation who's income is higher but accumulated wealth is lower, ZERO in the case of the negative equity generation. If they can afford to pay their taxes, great they can live their days out in their nice house. If they can't then sell up and move to something more appropriate to their needs, a two bed apartment perhaps. This would free up the place for a family who are much more in need of a big house. This benefits society at the expense of the individual. In regards to your parents, tough !!!

Current taxation and benefits in this country beggar belief. The family home is excluded for calculations. So you can have a 6m home but no income, so you get pension, medical card and all the trappings. If this house is tapped for income, then the state no longer needs to provide support. In reality providing support is just a freebie to old folks kids anyway though inheritance.

[Jackass]

This is a labour led tax and is a fu*king terrible idea.

1/ It will stagnate the existing property market disastor. There are banks who are holding out for money from sold apartment blocks and this will just be anoher negative factor to hault the market, meaning a lock down on banking liquidity and making all the going concerns even more toxic.

2/ It targets the vunrable, people who have mortgages at inflated prices who can't afford their payments and are trapped in massive negative equity and arrears now how another big bill to face.

3/ Labour are notorious for going after anyone with a scrap of money or success, and it doesn't exactly promote being sensible when other people are wreckless and the people who are doing ok have to foot the bill.

It's one of those measures that sadly always comes with Labour. Yet they'll prevent cleaning up the outrageous civil service over staffing and wage bill, the FIRST thing the IMF pointed out as absolutely hemmeraging cash. It's a hell of a lot cheaper to have 20,000 - 40,000 people on the dole than to be paying them all on average E50,000 per year (or 2 billion per year).

Make cuts on spending, dont tax your way out of trouble, at least 70% cuts / 30% tax, but more like 80 / 20 is right. Basic Economics.

ardmacha

It targets the vunrable, people who have mortgages at inflated prices

This is typical of the whining going on here. A well designed property tax doesn't target the vulnerable, it simply targets all people with houses. Almost half of houses don't have a mortgage, and half of those that do have a reasonable mortgage. Several posters here have suggested some reduction for people who paid a lot of stamp duty.

Pretty much every place in the developed world has a property tax, it is not any more unfair than any other tax and is a proper part of a State with a budget deficit. This thread has the usual we are Ireland and we are different from everyone else, common sense doesn't apply here.

Whatever about corporation tax, the EU paymaster do have reasonable case when they ask why Ireland does not use a tax that is in almost every other EU state.

jamesbrond

I think it will be much like the council tax in the UK.
If you live in an area you pay the cost of living in that area.

I think the first thing that will happens though is this.
Mortgage interest relief as well as tenants tax relief is also set to go. That will probably bring in more money straight away than any property tax. And it can be implemented at the stroke of a pen. More or less zero cost to it. They wont have to send bills, just pull the reliefs and its done. Instant savings at no cost.

gigino

robd wrote: »

Site valuation based on the sqm of the land is the way to go.

so a poor old single person living in a run-down old cottage on 4 acres in the wilds of donegal or may0 or clare, miles from services, is going to pay more than a tribunal barrister living in a mansion in Dublin 4 ?

What a silly idea.

Many people are already in negative equity, another property tax will just push some people over the edge. It would be impossioble to collect anyway. A bit like trying to collect the BBC television licence in Crossmaglen......safer not trying !