So, the Government have just introduced a €200 property tax for owners of second homes, which might I remind you has been effective since the 31st of July, but now the Government are seriously exploring the idea of introducing a Residential Property Tax for all! That’s right, you heard me, anyone who owns a home, regardless if it’s your first, second, third … or fourth, if you own it, you might just have to pay tax for it in the not so distant future.
So why introduce the Tax? The idea behind the introduction of a Residential Property Tax for all is to help fill the massive shortfall we are currently experiencing with Ireland’s finances. Although it might sound like this might help to narrow the large gap it has been estimated that if the tax was brought in that it is unlikely to generate more than €1 billion a year i.e. it won’t really improve our current financial situation.
Happy to note that there could be a few teething problems with the implementation of the Tax which could delay it awhile namely; how will the Tax be calculated in a way that is fair for all? i.e. flat rate, calculated on property size, calculated on property value? Second, how would the Tax managed i.e. setup and administration for the X number of properties in Ireland. Thirdly, anger and opposition. An extra Tax means extra financial pressure on all homeowners in the current economic climate.
Following the recent introduction of the €200 property tax for second homes, it seems inevitable that homeowners will not escape this recession without a property tax of some sort. If the Tax is introduced maybe this time round it will be the same last time i.e. The Residential Property Tax in the 1990s caused a deal of disagreement that it was eventually phased out.