Tax on some 137,000 vacant homes to be recommended by Oireachtas committee

Zoned land tax should be raised beyond planned 3% rate, new report to recommend

A vacant homes tax should be considered by Government while a forthcoming zoned land tax should be increased beyond the planned 3 per cent rate, a new Oireachtas committee report is set to recommend.

The report from the Oireachtas Joint Committee on Housing, which will be published on Tuesday, will also recommend an increase in the maximum funding available under the Repair and Leasing Scheme from the current limit of €60,000. The scheme was introduced to help bring vacant properties back into use for social housing purposes.

The report notes evidence given to the committee by architect Mel Reynolds who estimates that there are currently 137,000 vacant homes at present. The debate around vacancy comes at a time when the State is struggling to meet the twin pressures of the domestic housing crisis and the efforts to house Ukrainian refugees.

A Government source said this weekend that between 150 to 200 refugees continue to arrive every day and that finding accommodation continues to be a challenge.

The new report into urban regeneration has recommended the establishment of a single national platform which would put together and validate all existing data on vacancy and dereliction.

It has also recommended that the Department of Housing should conduct an audit of all local authorities to ascertain what exact data exists on vacancy and dereliction, and that sanctions should be introduced for public bodies that fail to register property assets.

On the issue of a vacant homes tax, the committee says the Government should consider introducing such a measure with “reasonable exemptions”. The Government’s Housing for All plan commits to the collection of data on vacancy “with a view to introducing a vacant property tax”. In the coming weeks the Revenue Commissioners will give new figures on vacancy to the Government ahead of a decision on such a tax as part of Budget 2023.

The Coalition has also committed to a new zoned land tax, designed to encourage the construction of housing. The tax, which will replace the existing vacant site levy, will target any unused land zoned and serviced for housing, regardless of its size. The new tax will be based on the market value of the land and the rate will be set at 3 per cent.

The committee’s report has said the Government should consider increasing the proposed zoned land tax beyond 3 per cent, “particularly given the current inflationary environment”.

The report also recommends the establishment of a new division in the Department of Housing which would be dedicated to tackling vacancy and dereliction, and that an appropriate number of full-time vacant homes officers would be appointed in each local authority.

There has been debate in recent years about the extent of vacancy across the country. The report notes that while statistics from various agencies suggest "an abundance of vacant units within Dublin city, Dublin City Council (DCC) advised that vacancy is much more nuanced than statistics show".

"In this respect, having carried out a pilot survey in four electoral divisions, DCC identified 213 potentially vacant homes, of which just 49 were confirmed as being vacant, with just 16 of those being confirmed as being vacant long term."

The council “advised that this dispels the assumption that there are over 30,000 vacant units in the city as per CSO data”.

“DCC advised for many properties identified as vacant or derelict there are often title difficulties, legal and probate issues, and owners with financial or other difficulties preventing them from making use of properties or sites.”