No Hints On Irish Property Tax

by Jason Gorringe, Tax-News.com, London

29 June 2010

Irish Prime Minister, Brian Cowen has declined to comment on the possible introduction of a property tax, as was advocated by the Commission of Taxation for introduction in 2009.

Responding to questioning by the leader of opposition party, Fine Gael, Enda Kenny, Cowen said that the government would be evaluating the proposal “as a budgetary matter… decided at the time of the budget.” He observed that the move would be a significant “structural change in the taxation system.”

He made the comments following media reports that identified that the tax was under consideration, at annual rates ranging from EUR250 to EUR3,000, depending on the size and value of the home in question. Such a tax could generate as much as EUR2bn for the government annually.

Cowen said that the government was looking at a number of proposals, among them a site value tax. He disclosed that the talks towards a new tax on real estate was as a result of measures to widen the tax base, as was recommended by the Commission for Taxation, in its pre-budget report last year.

Speaking in August 2009 to national broadcaster RTE, Irish Minister for Finance, Brian Lenihan said that while a property tax would not be introduced in the December 2009 budget, there "remains room for an increase in taxes on real estate at a later date."

The Fine Gael leader has announced that if proposed, the party would reject a broad property tax.

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