Eoghan Murphy
Ceist:67. Deputy Eoghan Murphy asked the Minister for Finance if his Department has calculated the potential effect the property tax will have on the property market. [13440/13]
Amharc ar fhreagraWednesday, 13 March 2013
Ceisteanna (67)
Freagraí scríofa
Work carried out by researchers in the Economic and Social Research Institute (ESRI) before the introduction of the Local Property Tax concluded that a property tax at a rate of 0.4% would result in a small increase in the user cost of housing, thereby putting some downward pressure on housing demand. The Local Property Tax rate of 0.18% (for houses up to €1m in value) is less than half the rate used in the ESRI analysis, and, as such, the impact on housing demand is likely to be minimal. In addition, the property rental market is a competitive market, with many suppliers and renters. Upstream costs such as the Local Property Tax are likely to be passed through in the rental market and as such will not create a disincentive to purchase houses relative to renting.