Reduced VAT on new build houses and apartments.

Dinarius

Would it seriously result in a reduction in what the buyer pays?

Or would it just result in exchequer coffers being even worse off than they already are?

D.

ytpe2r5bxkn0c1

No.

Yes.

maryishere

Vat here is 23%, it should be reduced to the rate it is in the UK, I think its 20% there. That will save everyone money on most things. The UK government spends money on its armed forces, what do we squander all the money on in this country?

Something is wrong anyway ; it costs €100,000 more to build a house south of the border compared to north of the border. No wonder there are so few houses being built.

bear1

maryishere wrote: »

Vat here is 23%, it should be reduced to the rate it is in the UK, I think its 20% there. That will save everyone money on most things. The UK government spends money on its armed forces, what do we squander all the money on in this country?

Something is wrong anyway ; it costs €100,000 more to build a house south of the border compared to north of the border. No wonder there are so few houses being built.

What has the British armed forces got to do with building houses in Ireland?
100k more? Where did you get this info?
Also.. it isn't 23% here when it comes to houses. It's either 13.5% or 0%.
In the UK you need to pay council rates I believe they are called where here you don't.. So no it isn't as cheap as you think over there.
Want a real solution to our problems? Scrap height restrictions in major cities and let developed build up rather than out.
It's a farce that anything over 10 storeys becomes a shock horror story to nimbys

maryishere

Only six European countries pay more in VAT on goods and services than we do in Ireland, with Germany’s rate 4% lower.

http://www.thejournal.ie/vat-in-ireland-comparison-to-europe-1803395-Jan2015/

Cutting vat on goods here could be self financing and win win for everyone, as so many people buy online now, sometimes from the UK etc.

ytpe2r5bxkn0c1

maryishere wrote: »

Only six European countries pay more in VAT on goods and services than we do in Ireland, with Germany’s rate 4% lower.

http://www.thejournal.ie/vat-in-ireland-comparison-to-europe-1803395-Jan2015/

Cutting vat on goods here could be self financing and win win for everyone, as so many people buy online now, sometimes from the UK etc.

Yes, fair enough but would a reduced rate lower the price of houses sufficiently to ease the housing crisis?

Of course not.

noodler

maryishere wrote: »

Only six European countries pay more in VAT on goods and services than we do in Ireland, with Germany’s rate 4% lower.

http://www.thejournal.ie/vat-in-ireland-comparison-to-europe-1803395-Jan2015/

Cutting vat on goods here could be self financing and win win for everyone, as so many people buy online now, sometimes from the UK etc.

Was the point not already made that the top rate if vat doesn't apply in this discussion?

the_pen_turner

vat isn't the issue . at least not the major ones

the issues I see are
land costs
fact that builders are not hiring guys permanently. most guys are self employed and subbing
all the subbies have to pay all the business costs themselves which is higher than if they all worked for a company
diesel prices
material prices
insurance and h&s compliance costs
extra costs from higher spec and building regs
customers wanting turn key homes all finished inside and out. not like years ago where all was built was a shell and the basic rooms

bear1

maryishere wrote: »

Only six European countries pay more in VAT on goods and services than we do in Ireland, with Germany’s rate 4% lower.

http://www.thejournal.ie/vat-in-ireland-comparison-to-europe-1803395-Jan2015/

Cutting vat on goods here could be self financing and win win for everyone, as so many people buy online now, sometimes from the UK etc.

Again, what has this got to do with houses? I already told you we pay less in VAT for houses then your example being the UK.
In fact the UK even up'd their VAT to 20 from a 17 a years ago and yet we either pay 13.5% or 0. So, explain how we are paying more in VAT than the UK when it comes to houses?

Karangue

Pay in cash no vat.

riclad

A large part of the cost of a house in dublin is site cost , in the boom investors bought land for crazy prices .
They,ll expect to get a good return on their investment.
builders have to buy land and also get finance before a single brick is put up.
And they need to make a profit.
i,m not an expert but modern houses are built to a higher spec than in the 80s.
Another issue is it takes a long time to get planning permission for a large estate.
reducing vat wont help solve those issues.
It seems house building stopped in 2008,
its gonna be hard to get it going again in large no,s

maryishere

riclad wrote: »

A large part of the cost of a house in dublin is site cost , in the boom investors bought land for crazy prices .
They,ll expect to get a good return on their investment.
builders have to buy land and also get finance before a single brick is put up.
And they need to make a profit.
i,m not an expert but modern houses are built to a higher spec than in the 80s.
Another issue is it takes a long time to get planning permission for a large estate.
reducing vat wont help solve those issues.
It seems house building stopped in 2008,
its gonna be hard to get it going again in large no,s

As far as I know / I read somewhere, the vat rate on new houses north of the border is 0%, whereas the government here in Dublin gets about 40 grand in vat on the average new house.

ytpe2r5bxkn0c1

maryishere wrote: »

As far as I know / I read somewhere, the vat rate on new houses north of the border is 0%, whereas the government here in Dublin gets about 40 grand in vat on the average new house.

You are mixing two distinct things there. Correct there is 0% vat on the sale of a new house in the UK. But.... it's the same here. Yes, vat included in the building costs of a house could amount to 40k but it would be higher in NI as the vat on building materials is higher than here.

You can't quote vat on the sale versus vat costs of building.

Donald Trump

Dinarius wrote: »

Would it seriously result in a reduction in what the buyer pays?

Or would it just result in exchequer coffers being even worse off than they already are?

D.

No. It just gives more money to builders.
Simple example:
Two people want a house - Johnny and Mick. They are the only two who want the house. and the builder needs to sell the house for the best possible price.
Both get pre-approved for mortgages. Johnny is willing to pay up to 250k for the house. Mick is willing to pay up to 260k.

Case 1) Vat is 50%:
Result: Mick gets the house for 251k.

Case 2) Vat is 0%
Result Mick gets the house for 251k

Basically the market price is set by what people are willing to pay, not by the inputs that went into the building process


Where it might have an indirect effect is if builders start making loads more money and then in theory more builders start building which increases supply and brings down prices that way. But tat argument is a little weak as building land is not freely available. For the most part, most large plots are controlled by a small amount of developers