Dáil Éireann Debate, Wednesday - 20 October 2021
89. Deputy Noel Grealish asked the Minister for Finance if he will introduce a tax incentivisation scheme that facilitates owners and purchasers of town centre commercial buildings convert them into residential properties; and if he will make a statement on the matter. [51585/21]
Amharc ar fhreagraThe Housing for All Strategy was developed in consultation with all relevant Government Departments, including my own. The measures set out in the strategy, together with the associated timeframes for delivery, represent the current actions for priority attention in order to increase the supply of residential property.
Having said this, the Deputy will be aware of the Living City Initiative (LCI). The LCI is specifically aimed at the regeneration of the historic inner cities of Dublin, Cork, Galway, Kilkenny, Limerick and Waterford. The scheme provides income or corporation tax relief for qualifying expenditure incurred in refurbishing/converting of qualifying buildings, including for residential purposes, which are located within pre-determined 'Special Regeneration Areas' (SRAs).
There are three types of relief available:
- Owner-occupier residential relief;
- Rented residential relief; and,
- Commercial/Retail relief.
In 2016 officials from my Department reviewed the measure in consultation with the relevant councils and the then Department of Arts, Heritage, Regional, Rural and Gaeltacht Affairs. On foot of that review, a number of changes were brought forward in Budget 2017 in order to make the initiative more attractive and effective. The principal change extended the residential element of the scheme to landlords, who may now claim the relief by way of accelerated capital allowances for the conversion and refurbishment of property, which was built prior to 1915, where such property is to be used for residential purposes.
In relation to property-based reliefs more generally, taxation is only one of the policy levers available to the Government through which to boost overall housing supply. In line with my Department's Tax Expenditure Guidelines, consideration of whether a tax measure is the most appropriate policy tool for a given purpose is required. The presumption should be that non-tax measures should be considered before the use of a tax–based measure. The primary responsibility for direct expenditure based policy in this area lies with the Minister for Housing, Local Government and Heritage.
Finally, Ireland’s past experience with tax incentives in this sector strongly suggests the need for a cautionary stance.
