PROPERTY TAX IS COMING

RandomName2

Okay, like that's the news of the century!

We have moved beyond the question of whether there's going to be property tax to that of:
'What's it going to be like? What's it going to cost? Who's going to be hit hardest... or not at all? Can you dodge it? What's likely to happen to those that try?'

But unfortunately we are still bogged down in the government's (obviously) disingenuous mantra that it is simply to pay for services. :pac:

And so we come to the questions of - what's fair and what's practical?

What do you think?

My personal preference would be for a modest sum for all adults in this country; something that people could reasonably manage (€150 a year?). Taken straight out of paye or cut from social welfare for public servants and recipients. respectively. However, that would be a poll tax and would not have the silly connotations of paying for local libraries or cutting the grass of local parks that go along with the hypothetical figures of between €1000 - €5000 property tax for Dublin homes. Failing that, base on household income - but that would beg the question; why not just increase income tax instead?

The country has large debts - why is so much being predicated on water and property taxes to pay them back?

GCU Flexible Demeanour

RandomName2 wrote: »

what's fair and what's practical?

What do you think?

Much of this kind of discussion is being had all over. For my part, if it's a tax on property I'd see income to be largely irrelevant. I don't see why a person who is asset rich should be exempt, just because their income is low.

I'd expect the point of this tax - which, as I understand it, is something the Troika are looking for and something that probably wouldn't be on the agenda otherwise - is to mobilise resources that would otherwise not be available. Hence, it has to bring into the fold the stored value represented by assets.

A positive of this should be that scarce resources are not wasted - it gives an incentive for pensioners to move, freeing up housing for families, and (if they include farm land - which I think they should) it gives an incentive for necessary consolidation in the agricultural sector.

That's my justification it being value-based. However, I don't think the argument that a market-value tax reflects the cost of servicing sites is valid. Urban locations get better services, but they cost less. Hence, if the tax was to be linked to services supplied, urban dwellers should pay less, not more.

Of course, if this tax is intended to fund local government, then all central government need do is provide the power to local authorities to set the level in their areas. If (as will be the case) urban local authorities find they can provide reasonable services at lower costs than predominantly rural areas, clearly this will be reflected in a lower charge.

But, from coverage, I'm not clear that this actually is intended to fund local services - I know there's references to such, but it reads more like kite-flying than an actual intention.

Slydice

lol

They're isn't a property tax coming.

It's already here.

It's called the household charge. Here's the website:
https://www.householdcharge.ie/default.aspx

What's coming is just the way the amount is calculated. All the ways seem to be a good bit more than the current 100 euro charge. Saying that though, it's not like we weren't told. It was up in loads of the opposition posters to the household charge when it was being brought in.

MadsL

Why not have a local income tax. That way with a democratically elected mayor for each metropolitan area they can be held responsible for the way local money is spent.

Good loser

I'm not sure what Local Govt costs but I think it's around €7 bn.

If the tax takes in €500m it will raise less than 10% of costs.

That means AT MOST it is a contribution to services to the extent of about 8%.

flynnlives

its a tax for a bankrupt nation to keep Inda in his 200k a year job and the other wasters in the dail
a tax to keep high level PS in their comfort zones such as the city manager of Cork who earns more then the PM of Spain.

a tax to protect the vested interest of the PS and Civil Service.

hmmm

I'd love to see a property tax with levels set by councilors. It would really help local democracy, and if one particular council was happy to be over-run by sewage, while the other decides to build a monorail well and good.

Pete_Cavan

There is more to a property tax than just raising revenue, if done properly. A Land Value Tax encourages efficient use of land. Land is a factor of production so is vital to the economy, it is also fixed in supply so for any land that is not used efficiently there is an opportunity cost to the rest of the economy. Taxing land would force those who own land but are not doing anything with it (be they private individuals, the state, NAMA, etc) to sell to those who can do something with it. LVT is about more than the revenue it raises, it has many economic benefits without distorting the economy.

LVT discourages speculative property deals and deters developers from speculatively building up a land bank but does not punish farmers and those who live on and own marginal land unfairly for owning large areas of land (the tax could only levied on value over a certain threshold to exclude small holdings or farmland altogether). It is proven not to distort the economy to favour any particular group. Along with proper planning reforms, it would prevent future speculative property bubbles like we saw here during the boom and provide a boost to the economy.

GCU Flexible Demeanour

Pete_Cavan wrote: »

LVT discourages speculative property deals and deters developers from speculatively building up a land bank but does not punish farmers and those who live on and own marginal land unfairly for owning large areas of land (the tax could only levied on value over a certain threshold to exclude small holdings or farmland altogether).

Your logic is fine, apart from this arbitrary exclusion of farm land. There is absolutely no reason to exclude farm land, and much to be gained by giving an incentive to small farmers and part-time farmers to leave the sector by selling to another producer if they cannot generate an income from the asset they are sitting on.

Manach

I for one welcome a chance to keep the concuillors in the life-style that they are accustomed to.
Also, as a historian re: rural land, I'd mention in passing the prior history Ireland has had when governments demand monies from the rural areas and the confrontation that this engendered.

GCU Flexible Demeanour

Manach wrote: »

I for one welcome a chance to keep the concuillors in the life-style that they are accustomed to.

I'd agree that if it's to fund local services, local councillors should be responsible for setting the level of tax and justifying what it is spent on to the people who elect them.

Manach wrote: »

Also, as a historian re: rural land, I'd mention in passing the prior history Ireland has had when governments demand monies from the rural areas and the confrontation that this engendered.

How many people were engaged in agriculture then, as compared to now? The farmers' lobby is a spent political force. There's too few of them, and they are too old, to mount any effective campaign.

The only reason anyone is mentioning an exemption for agricultural land is habit.

flynnlives

flynnlives wrote: »

its a tax for a bankrupt nation to keep Inda in his 200k a year job and the other wasters in the dail
a tax to keep high level PS in their comfort zones such as the city manager of Cork who earns more then the PM of Spain.

a tax to protect the vested interest of the PS and Civil Service.

You also left out keeping one of the best social welfare rates in the world, and still supporting tens of thousands of non working migrants.:eek:

GCU Flexible Demeanour

GCU Flexible Demeanour wrote: »

Your logic is fine, apart from this arbitrary exclusion of farm land. There is absolutely no reason to exclude farm land, and much to be gained by giving an incentive to small farmers and part-time farmers to leave the sector by selling to another producer if they cannot generate an income from the asset they are sitting on.

Im not a farmer, but alot of the land in the west is not profitable but is still keeping a certain amount of (older)people ticking over and off the dole.

If you tax that land the small farmers will have to sell, this land is useless for any commercial farmer as it needs too much attention. Anyway, If they make a profit they will be paying tax on that profit from the land.

It would also give no incentive for anybody to get into farming as they would be taxed twice, its aleady starting to die out completely in some areas.

GCU Flexible Demeanour

Deleted User wrote: »

Im not a farmer, but alot of the land in the west is not profitable but is still keeping a certain amount of (older)people ticking over and off the dole.

I'm afraid that statement just doesn't make sense.

You may mean to say something different.

Deleted User wrote: »

If they make a profit they will be paying tax on that profit from the land.

But isn't the point to release some of the value tied up in property. This will, very quickly, become a circular exchange.

Including agricultural land would have all the benefits outlined by Pete_Cavan in respect of land in general. It would also ensure that agricultural land values matched its productive potential.

GCU Flexible Demeanour

GCU Flexible Demeanour wrote: »

I'm afraid that statement just doesn't make sense.

You may mean to say something different. But isn't the point to release some of the value tied up in property. This will, very quickly, become a circular exchange.

Including agricultural land would have all the benefits outlined by Pete_Cavan in respect of land in general. It would also ensure that agricultural land values matched its productive potential.

A lot of land that is been farmed now in the west is not suitable for any professional farming, it is of just too poor quality and will never be of much use for anything.(There was a reason Cromwell didn't want Connaught, if connaught had good land that the english wanted the rest of us would probably of been on those slave ships to the plantations).

But there are some willing and able to make a very poor living off this land equivalent in sums to the dole, they are better doing this than increasing the dole queues in my opinion. These farmers are never going to be farmers that will reach the tax bracket never mind been able to pay property taxes on land that is one degree off bog. Im talking about those small farms where you would hardly be able to turn a tractor in some of the fields, and not the bigger viable farms with decent land further East and South.

Anyway as a Farmers son i thinks most of these will be finished within 20 years with vast swathes of very poor land lying empty and growing wild with younger people not willing to invest there time or money into it for such poor return. You may get smallholders willing to grow there own vegetables and raise chickens, but nobody would touch it if property taxes applied.

If i follow your thinking, then then they should rightly cut subsidies, let land prices fall to a value that would be worth an investment as a viable farm >200 acres. But you still would be get capital taxes on any profit this farm makes if any, like any business.

GCU Flexible Demeanour

Deleted User wrote: »

… there are some willing and able to make a very poor living off this land equivalent in sums to the dole, they are better doing this than increasing the dole queues …

I think you need to reconsider; what you are saying is these are people who you only see fit for either scratching a living out of dirt, or the dole.

Deleted User wrote: »

You may get smallholders willing to grow there own vegetables and raise chickens, but nobody would touch it if property taxes applied.

But the point is that a property tax will be proportionate to the value of the land. If the land is really valueless (in the sense of it being unsaleable, even at a price of €1), no tax will apply. However, as is more likely the case, if land can be used for some productive purpose, a property tax will provide an incentive for it to be so used. The value of the land will not exceed its value for that productive purpose.

Dannyboy83

RandomName2 wrote: »

Okay, like that's the news of the century!

We have moved beyond the question of whether there's going to be property tax to that of:
'What's it going to be like? What's it going to cost? Who's going to be hit hardest... or not at all? Can you dodge it? What's likely to happen to those that try?'

But unfortunately we are still bogged down in the government's (obviously) disingenuous mantra that it is simply to pay for services. :pac:

And so we come to the questions of - what's fair and what's practical?

What do you think?

My personal preference would be for a modest sum for all adults in this country; something that people could reasonably manage (€150 a year?). Taken straight out of paye or cut from social welfare for public servants and recipients. respectively. However, that would be a poll tax and would not have the silly connotations of paying for local libraries or cutting the grass of local parks that go along with the hypothetical figures of between €1000 - €5000 property tax for Dublin homes. Failing that, base on household income - but that would beg the question; why not just increase income tax instead?

The country has large debts - why is so much being predicated on water and property taxes to pay them back?

It's just easier to sell to the electorate, that's all.

Property tax is something that other countries have, and we don't.
If other countries had a tax on beans, then they'd be bringing that in here too.

It's just a tax, but they need a way to sell it without falling on their own sword.

I'll be exempt from the property tax, for a short while at least, but I think everyone should have to pay - me included.

Godge

GCU Flexible Demeanour wrote: »

But the point is that a property tax will be proportionate to the value of the land. If the land is really valueless (in the sense of it being unsaleable, even at a price of €1), no tax will apply. However, as is more likely the case, if land can be used for some productive purpose, a property tax will provide an incentive for it to be so used. The value of the land will not exceed its value for that productive purpose.

This is one of the three advantages that make a property tax much better from an economic point of view that increased income tax.

(1) The property cannot be moved abroad and short of demolishing it cannot be avoided. Activity such as services and manufacturing that generate wages and salaries can be moved abroad if the cost of hiring is made too high by the cost of income tax.
(2) Income tax is levied on those working in Ireland and takes directly from the economy. A proportion of property in Ireland (c. 10%?) is owned by foreigners or those Irish tax resident abroad and therefore some of the tax raised is money brought into the country.
(3) If you have a derelict site in central Dublin worth millions, the property tax acts as an incentive to get some return from the site.

Shea O'Meara

I'm completely against it.
It's blood from a stone time. Saying it's to pay for services may be true, but it's not the lack of this new tax over the years that has Ireland in the mess it's in.
To blackmail people into paying by scaremongering about services breaking down if people don't pay it is a disgrace.
This coupled with the forthcoming 'communication tax' (patent pending) for anyone with a TV, desk top or laptop is basically a fleecing of the public, who already are paying back a private debt thanks to the bail outs for the investors who gambled and lost, but got paid anyway.
Don't you pay tax when you buy your house? What's that for so? Do you get that taken off your bill?
Logically, for me, if you buy something you own it. Why must you continue to pay for it after the fact? Should I pay 50c a week toward the shoes I got for a wedding I attended last month? I mean I'm sure it could be justified in all the ways this tax on property is being sold to us.

Godge

Shea O'Meara wrote: »

I'm completely against it.
It's blood from a stone time. Saying it's to pay for services may be true, but it's not the lack of this new tax over the years that has Ireland in the mess it's in.
To blackmail people into paying by scaremongering about services breaking down if people don't pay it is a disgrace.
This coupled with the forthcoming 'communication tax' (patent pending) for anyone with a TV, desk top or laptop is basically a fleecing of the public, who already are paying back a private debt thanks to the bail outs for the investors who gambled and lost, but got paid anyway.
Don't you pay tax when you buy your house? What's that for so? Do you get that taken off your bill?
Logically, for me, if you buy something you own it. Why must you continue to pay for it after the fact? Should I pay 50c a week toward the shoes I got for a wedding I attended last month? I mean I'm sure it could be justified in all the ways this tax on property is being sold to us.

You pay car tax every year, you pay tv license every year, you pay dog license every year, so following your logic, you should not pay these either?

seamus

Yeah, I'd definitely prefer to see a move towards local councils having more direct authority for their budgeting and funding, such that each LA would set their own rates based on their needs.

Calculation is a tricky one because valuation alone doesn't really cut it. A family of 4 people in a €100k house will consume far more resources than a single man in a €200k apartment.

Square metreage would seem to be fairer, one rate based on the amount of living space in the property, a nominal rate for the amount of recreation space (i.e. garden), and a separate rate for agricultural or commerical land space. Waste or undeveloped land should equally be taxed.

AlekSmart

Godge wrote: »

You pay car tax every year, you pay tv license every year, you pay dog license every year, so following your logic, you should not pay these either?

Good and valid points Godge.

One may,should they wish avoid ALL of the above taxes by the simple expedient of NOT accquiring the relevant taxable items...Car,TV,Dog.

What this NEW!,IMPROVED! Property Tax will do,IMO,is to raise a real question in many peoples heads of whether they actually need to OWN their residences at all.

If (and it's BIG If) the Property Tax were to be accompanied by a meaningful reworking of the entire Private Rented Accomodation rulebook,then Irish society would have made a great leap back into reality.

However,the fact that a significant element of our Political Class are totally bound up in the Property Development "Game" ensures that no meaningful attempt will be made.

As it stands,Irish Government Policy is to hang on in there until the Property Sector "Picks-Up again" and we get back to normal.......:o

Shea O'Meara

Godge wrote: »

You pay car tax every year, you pay tv license every year, you pay dog license every year, so following your logic, you should not pay these either?

You misunderstand;

Car Tax is supposed to off-lay various car related costs to the state, the finer points of that particular line of bull**** escape me at present.
TV Licence is for the service RTE provide and you can receive on your TV, but having said that I wouldn't pay it if I had an option.
Not familiar with an on going monthly, yearly dog tax.

The yearly tax on something you bought and paid for (and paid tax with that purchase), in this case a house, is not the same, unless of course the State will be cutting your grass or giving you a hand with re-painting the kitchen.

View

Shea O'Meara wrote: »

The yearly tax on something you bought and paid for (and paid tax with that purchase), in this case a house, is not the same, unless of course the State will be cutting your grass or giving you a hand with re-painting the kitchen.

You mean the way when you pay your car tax, the State pops round and services your car for you (and/or sets up your TV for you), right?

mr.underdog

Very interesting. Does anyone know anything about the 'Irish Citizens Party and it's founder Jim Connolly or is that just a wind up of the original 'James Connolly' and the 'Irish Citizens Army' ?

Godge

Shea O'Meara wrote: »

You misunderstand;

Car Tax is supposed to off-lay various car related costs to the state, the finer points of that particular line of bull**** escape me at present.
TV Licence is for the service RTE provide and you can receive on your TV, but having said that I wouldn't pay it if I had an option.
Not familiar with an on going monthly, yearly dog tax.

The yearly tax on something you bought and paid for (and paid tax with that purchase), in this case a house, is not the same, unless of course the State will be cutting your grass or giving you a hand with re-painting the kitchen.

no but the state is building and maintaining a public road to your house, providing street lighting for your house, providing gardai and a courts service to deal with crimes against your house (look at the number of burglary cases before the courts), is providing schools and school transport near your house, is subsidising utility access to your house be it water, electricity or sewage. For those in rural areas who say we have our own well and septic tank, the rest of us are paying for the Rural Broadband Scheme. There are lots of things the State does that can be linked to your house.

Imagine if you could not access a public road, you would have to live off the land and/or hike across fields and mountains to the nearest village for supplies.

JRant

A property tax would be more than fair if it was part of an overhaul off the entire tax system. A more fluid scale of tax payments could be introduced, its not rocket science.

As it stands though the preception is that is to bail out the banks and preception is reality to most people.

I'd hope people have no problem contributing towards society as a whole. It may be a pain at times but I'd rather that than living in an "mé fein" society.

foxcoverteddy

Well unless council tenents, unfinished estate homes and rented accomodation are not exempt, then there should be a national outcry and possible disobedience, because those people share the services the rest are paying for.
Same as the household charge clown hogan, only property owners pay, we have a government of sicko's, professional they may be, but are adept at looking after their own, fcuk the rest of you.
Words are falling on deaf ears.