As the Deputy will appreciate, stamp duty is a significant contributor to the Exchequer which helps to fund Government spending on public services such as health and education. Stamp duty receipts also allow for a broader tax base than would otherwise be possible.
All owner-occupiers are generally exempt from stamp duty on new houses where the property is 125 square metres or less, whereas an investor who purchases a new house for renting is liable for stamp duty where the price exceeds €127,000. First time buyers are also exempt from stamp duty on second hand houses up to the value of €190,500 and benefit, thereafter, from reduced rates on second hand properties up to €381,000 when compared to other purchasers, including investors. In addition, mortgage interest relief is available at source in respect of interest paid on moneys borrowed for the purchase, maintenance, repair or improvement of that taxpayer's main residence, including second-hand houses.
Applying the exemptions currently in force for new properties to first-time purchasers of second-hand houses would result in a loss of approximately €60 million per annum to the Exchequer. If these exemptions were granted to all owner occupiers, the cost would be considerably higher.
The Deputy will be aware that I receive numerous requests to introduce new tax reliefs and expand the existing ones associated with the purchase of residential property. However, tax reliefs reduce the tax base and would inevitably lead to calls for other concessions to be introduced into the stamp duty code. In addition, there is no guarantee that the tax revenue forgone would accrue to the purchaser as there would most likely be a consequent increase in house prices.
As the Deputy will appreciate, given the forthcoming budget, it is not appropriate for me to comment at this stage on the possibility of changes to the stamp duty code.