Dáil Éireann Debate, Tuesday - 22 September 2015
298. Deputy Clare Daly asked the Minister for Finance the number of pay as you earn taxpayers who purchased houses during the period when 9% stamp duty was levied on the price of houses; and the reason there is no offset of this penal rate of stamp duty against the local property tax. [30484/15]
Amharc ar fhreagraI am advised by the Revenue Commissioners that the 9% stamp duty rate on residential property transactions was effective from 23 January 1997 to 8 December 2010.
Information on the numbers of purchasers of residential property that paid stamp duty at the 9% rate is not available. However, the number of transactions where the 9% rate was paid is shown in the following table from 2004 onwards (data for earlier years are not available). A transaction could have had more than one purchaser and several transactions could be for the same purchaser. Stamp duty data on residential property transactions is not captured in such a manner that would enable a breakdown between 'Pay as You Earn' taxpayers and other taxpayers.
|
Year* |
Number of Duty Paid Transactions at the 9% rate |
|
2004 |
1,968 |
|
2005 |
2,939 |
|
2006 |
4,496 |
|
2007 |
3,435 |
|
2008 |
778 |
|
2009 |
200 |
|
2010 |
186 |
*The 9% rate applied to property transactions valued over €635,000 prior to 5 November 2007 and to property transactions valued over €1,000,000 between 5 November 2007 and 8 December 2010.
The report of the Thornhill group, on which the design of the local property tax (LPT) was based, proposed a tax system that would contain very limited exemptions and reliefs. As a general principle, reliefs should only be used to address clear economic and social policy needs and should be targeted based on need. The report cautioned that reliefs create costs which have to be paid for, either by taxpayers who do not benefit from the relief or by reductions in public expenditure. The report specifically recommended against providing reliefs for those who had paid stamp duty. The reasons given were that such relief would not be targeted on need, that the tax structure was known to house purchasers at the time of purchase, that the selling price of the property may have been affected by the stamp duty paid and that the stamp duty revenues would have been spent on the provision of public services.
While some individuals had a significant Stamp Duty liability, they may have been able to claim mortgage interest relief (MIR) on interest up to €20,000 per annum; and individuals who bought properties between 2004 and the end of 2012 can continue to claim mortgage interest relief until 2017. Mortgages taken out since 31 December 2012 do not qualify for mortgage interest relief.
A system of deferral arrangements is available where there is an inability to pay and certain specified conditions are met, whereby a person may opt to defer, or partially defer, payment of the tax. Where a person qualifies for a full deferral then 100% of the liability can be deferred. Where a person qualifies for partial deferral then 50% of the liability can be deferred and the balance of 50% of the tax must be paid.
