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Land Issues

Dáil Éireann Debate, Thursday - 3 March 2022

Thursday, 3 March 2022

Questions (110)

Gerald Nash

Question:

110. Deputy Ged Nash asked the Minister for Housing, Local Government and Heritage his views on the implementation of the land value sharing measures; when the measures will be implemented; if he will be introducing a temporary windfall tax in the interim for land that has been rezoned pending the delayed implementation of the land value sharing measures; and if he will make a statement on the matter. [12039/22]

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Oral answers (4 contributions) (Question to Housing)

The land value tax measures promised in the Housing for All strategy have yet to be delivered on. We have been told now that we will have to wait until next year for the implementation of those plans. Land value sharing was a key recommendation of the Kenny report and we resurrected those principles in a Labour Party Bill from last year. It is, effectively, as the Minister of State knows, a mechanism to allow the State to realise the benefit of an increase in land value when land is rezoned. The aim is to ensure that landowners do not enjoy a windfall from flipping sites. I ask for an update on these plans.

The implementation of a land value sharing measure represents an important step in the delivery of sustainable housing. The 2020 programme for Government committed to reviewing how community gain could be captured through the development process. The Housing for All policy includes a commitment to develop land value sharing measures to ensure that additional land value, which results from the zoning or designation, and the granting of planning permission, will be shared in a fairer way with the State and that communities will also benefit from improved infrastructure provision. A general scheme of a Bill for land value sharing and urban development zones was approved by the Government in December 2021, with detailed drafting to follow an economic appraisal and stakeholder engagement, ahead of enactment in quarter 4 of 2022.

Provisions for a residential zoned land tax were included in the Finance Act 2021 to impose a financial tax where land that is zoned and serviced is not brought forward for housing development. Land value sharing and the residential zoned land tax are key elements in a new approach of active land management. The lead-in time for their implementation is necessitated by virtue of preparatory work, economic appraisal and legislative enactment, in the case of land value sharing. All of this is essential in ensuring that a fair, reasonable and evidence-based approach is taken and it would not be appropriate to introduce a windfall tax in the interim.

Significant amounts of money are being made and have been made over the years by developers simply flipping land. Nothing speaks to the issue of the financialisation of housing more than the practice of land being bought, flipped, literally overnight sometimes, and nothing being developed. Genuinely radical measures, such as those called for by my colleague, Senator Rebecca Moynihan, must be introduced to address the issue of windfalls arising from the rezoning of lands.

I read yesterday in the commercial property section of The Irish Times about a parcel of land in Laytown in my constituency. It is not zoned for housing and would ordinarily sell for about €15,000 an acre, but it has been put on the market now for approximately €72,500 per acre. That has been done in the hope, from the estate agent's perspective, that the land may be rezoned in 2027. This speaks to the issue of the financialisation of housing as being a major issue. The Minister of State understands this and we need measures to be brought in urgently to address these problems.

The State is serious about several measures it is taking in this context. The land value sharing tax will be a significant measure in driving the share to the State up to 50%, potentially, when it is included with the affordability mechanisms introduced by the Minister. The Deputy will also be aware of the residential zoned land tax, whereby mapping procedures are now underway throughout the State. It was also included in the Finance Act 2021. Additionally, the Law Reform Commission is also preparing a report regarding reforming the compulsory purchase order, CPO, mechanism to allow the State to take a stronger hand in bringing derelict and vacant properties back into use. Therefore, taking the trajectory in recent decades, several reports have found that the State must be active in this area and the Housing for All policy has provided the vision to breathe life into that objective.

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