The stamp duty provision is immensely complicated. There must be a simpler way of stating it.
SECTION 90.
Question proposed: "That section 90 stand part of the Bill."
It is complicated because the officials wanted it to yield the exact equivalent of the revenue from residential property tax. That is the reason for the complicated financial resolution and the provision in the Bill. It was not necessary.
No ordinary person could understand it. The schedules to the Stamp Duty Act are hard to understand but this provision——
——is impossible.
A leaflet from the Revenue Commissioners is the only means by which it could be understood.
It has been brought to my attention by the Irish Property Owners Association that rented property did not come within the ambit of the residential property tax, but under the new definitions it does.
Only in terms of the sale of property. The business section of a residence is exempt and that is why the stamp duty provision is somewhat complex. An explanatory leaflet was sent to solicitors on the night of the Budget Statement, as they are the people who will have to deal with the matter. However, I accept the Deputy's assertion that it is complex.
Deputy McCreevy's point is that a house in Upper Rathmines Road in 12 bedsitters did not attract residential property tax. However, the sale of that house will now attract 9 per cent stamp duty.
Yes. It is the only way we will get tax from it.
I am not objecting to it. However, it is an extension of the tax base. If I buy a house in 12 bedsitters to convert it to a residence——
That has been the pattern. Few of those properties have been bought as single dwellings to be converted into bedsitters.
The Minister would be surprised. I am shocked at the number of houses that have remained in flats.
However, the houses coming on to the market tend to be bought for conversion to single residential use.
The first time buyer's exemption from stamp duty is creating anomalies in parts of my constituency where house building is taking place. I know a case where a person bought a house two years ago and did not qualify for stamp duty. He must now sell the house but is obliged to compete with houses being built up the road. This person put forward an interesting suggestion which perhaps the Minister's officials would consider. Rather than looking at a base of 6, 7 or 8 per cent, perhaps the first £80,000, the price of a three bedroomed house at the lower end of the market, could be the threshold exemption. This might remove some of the anomalies.
The Deputy will probably recall there was stamp duty on new houses many years ago until a clever solicitor found a way of selling the site before the roof was put on the house which meant there was no stamp duty on new houses. I am not precisely sure how the exact mechanism was found, but it was something along those lines. The practice was legislated for and stamp duty was no longer payable on new houses, primarily as a boost to the building industry. The new house grant is only for new houses.
My party was the initiator of most of those ideas. I am against the new house grant because I have found that it goes to the builder. It does nothing when the market is pump-primed, although there may be some justification for it when the market needs to be pump-primed. Nobody has the guts to remove this grant which is going into the pockets of builders.
I recall that when the Deputy and I were elected to the House in June 1977, his manifesto programme proposed a £1,000 house grant. I believe the amount at the time was £250 or £300. When the first grants were paid, the house price index showed that house prices had gone up by £1, 004.
Deputy Michael Ahern has considerable experience of this.
I worked for five or six years in the housing business and when the grant increased, house prices increased the following week.
Question put and agreed to.
Sections 91 and 92 agreed.