DUBLIN FIANNA Fáil TD Chris Andrews has expressed strong opposition to a property tax but economist Colm McCarthy called for its introduction.
Mr Andrews said a property tax was not the right way to raise revenue and he welcomed the Taoiseach’s comment that no decision had been made on the issue.
“Given the current difficulties experienced by people in relation to mortgages I would be strongly opposed to the implementation of any such tax. Property values have fallen by an average of 50 per cent and people are struggling to pay for their homes. I believe that a tax on the family home is not the right approach to take,” he said.
Mr Andrews said that the introduction of residential property tax by the Fine Gael-Labour coalition in the 1980s was “grossly unfair” as it penalised people who lived in certain addresses, irrespective of their own personal circumstances.
“The value of property was taken into consideration, while other assets such as cars, second homes, etc were not, hence some very wealthy people paid little or no tax on their property,” he said.
Mr Andrews agreed that the financing of local government was in urgent need of reform but he said that reform of local government procurement processes and service delivery should be implemented as a first step.
Colm McCarthy took the opposite view and said a property tax should be introduced to replace stamp duty.
“I think we’re going to have to move away from stamp duty. This was the main burden of the commission for taxation report last year, that we’d be much better off with a regular annual tax on residential property rather than a huge and unstable once-off bill,” he said.
He said that if rates had not been abolished in the 1970s they might be around €1,000 a year by now for a typical household.