Dáil Éireann Debate, Wednesday - 16 February 2022
111. Deputy Michael Creed asked the Minister for Housing, Local Government and Heritage the current situation regarding the vacant site tax and the way it will apply in respect of zoned lands that are not attracting developer interest; and if he will make a statement on the matter. [8642/22]
View answerThe Residential Zoned Land Tax is a land activation measure introduced in the Finance Act 2021. The purpose of the proposed measure is to incentivise the activation of land which is zoned and serviced for residential development, but remains undeveloped. It is primarily intended to influence behaviour towards increased housing output, rather than to raise revenue. The tax will replace the Vacant Site Levy.
The significant benefit of the tax is to incentivise the development of suitably zoned land across the State which has been the beneficiary of investment in servicing for housing construction. This includes lands in cities, towns and village centres which are vacant or idle where such lands are zoned for mixed use including residential. The tax measure, in conjunction with the ongoing review of development plans throughout the State to identify and zone housing land needed to meet statutory Housing Supply Targets will ensure that delivery of housing on zoned and serviced land is progressed. The tax will, when it comes into effect in 2024, be applied at an annual taxation rate of 3% of market value of the land to encourage use for appropriate development.
The tax will apply to all land zoned for residential or a mix of uses including residential and which are serviced throughout all 31 local authorities, with certain lands excluded from scope. The role of the local authorities is to identify the lands in scope via a mapping process commencing November 2022, which includes appeal provisions where the relevant landowner considers that a parcel of land does not meet the criteria for falling within the scope of the tax. After the publication of the final maps in December 2023, the tax will be managed by the Revenue Commissioners. The maps will be reviewed annually by local authorities to ensure they are up to date. The tax will remain as a charge on the land, will be applied annually and will be collected by the Revenue Commissioners, incentivising the development of the land-bank by the owners, or the sale of the land to those who will undertake development.
The criteria for inclusion on the map is land zoned in a Development Plan or Local Area Plan solely or primarily for residential use, or for a mixture of uses that includes residential use, where such lands are able to connect to the necessary infrastructure to enable housing development and for which there is capacity available. Zoned land subject to known issues relating to contamination or the presence of known archaeological or historic remains are to be excluded. There are certain exemptions specific to either residential or mixed use serviced land. For residential zoned land, these involve commercial uses which provide a service to the surrounding area and are liable for commercial rates. For lands zoned for a mixture of uses, including residential, the focus is on lands which are vacant or idle and not integral to any unauthorised use of the lands. All other land use zonings are not within the scope of the tax. Existing dwellings and their gardens, while they will be included in the maps, are not included in the scope of the tax.
Landowners may also make submissions to local authorities during the public consultation periods on the maps to amend zonings to remove their lands from the scope of the tax, which could also reflect those lands which are not attracting development interest. In considering these submissions and the potential for varying the adopted development plan as a result, the local authorities must take into account the proper planning and sustainable development of the area and the need to zone sufficient land to meet the statutory Housing Supply Targets.
My Department notified all local authorities of the introduction of the tax measure on signing of the Finance Act 2021. My Department is preparing guidance on the mapping process and the management of rezoning requests and is liaising with stakeholders through a working group. Financial support and assistance to the local authorities will also be provided on this matter to ensure that the maps will be published as required by the legislation. My Department will bring forward separate transitionary legislation to repeal the vacant site levy arrangements and this will take account of lands that might otherwise fall out of the full scope of the Vacant Site Levy, that are currently subject to the Vacant Site Levy.
