Stamp duty proposals criticised

Proposals for large-scale reform of stamp duty have been criticised by Minister of State for Housing Noel Ahern, who has said…

Proposals for large-scale reform of stamp duty have been criticised by Minister of State for Housing Noel Ahern, who has said they would be "not relevant and not just".

His stance appears to contrast with that of his brother, Taoiseach Bertie Ahern, who said last week that the concept of introducing stamp duty reform in the summer "makes sense".

The Minister of State said yesterday some of the more extensive proposals on stamp duty reform would cost the exchequer €1 billion.

He said he had "leafy" areas in his constituency where some voters may want extensive stamp duty reform, "but I also have Finglas and Ballymun, and it's irrelevant for most people there."

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At a briefing in Dublin on the provision of social and affordable housing, Mr Ahern said that when he looked at the needs in his constituency, he found it strange that so many people were talking about stamp duty.

"One sympathises with first-time buyers and they should be helped in whatever way," he said, "but a very small percentage of first-time buyers pay stamp duty, outside Dublin anyway, so it's not relevant to the majority of first-time buyers.

"If I had €1 billion, I think you could spend €1 billion more sensibly on people who need it than on helping people buy their €1 million house. It makes popular soundbites, but it's not a very well-targeted use of €1 billion.

"It's wrong to be giving signals that there's going to be fundamental reform. Stamp duty affects about 40,000 people a year. There is a lot more need out there. This talk about doing away with stamp duty is not relevant and not just."

Mr Ahern said that thresholds could be adjusted, but that would have to be approached carefully because house prices could still increase, offsetting any gains.

Labour leader Pat Rabbitte reiterated yesterday that stamp duty reform would be an "immediate priority" and would be dealt with in one go if his party and Fine Gael formed the next government.

Speaking to reporters outside Government Buildings, where he detailed 10 issues that would be tackled in the first 100 days of a Labour government, Mr Rabbitte said there was no significance in the fact that stamp duty was not among them.

He said there was a convention which meant that nobody could signal in advance precisely when they proposed to change a tax measure, but Labour and Fine Gael had been clear that the matter would be dealt with as a priority if they formed the next government.

"It is a significant tax alteration and it appears the Government parties are now going to follow our example," Mr Rabbitte said.

He added that the next government would not have to wait for its first budget to change stamp duty and that the issue could be dealt with outside the normal budgetary process.

Tánaiste Michael McDowell said that he could not speak for Fianna Fáil, but he believed that Mr Ahern saw the logic and sense in the Progressive Democrats plan to abolish stamp duty in one swift move. He said that the PD proposal to abolish stamp duty would be done in the lifetime of the next government.