Stamp Duty

Stamp Duty is a lazy tax and should be abolished.

Not because it it has become an Election Issue.

It is unfair and fails to address the underlying issue of gains arising from the uplift of property values.

At root is a fundamental shortage of serviced land for building.

However, there is a large tranche of empty houses in Ireland, as evidenced in the recent Census. Some of these are holiday houses, others have been sterilised by builders, assembling a block for future development.

These are valuable assets that are not being utilised.

It is in this area that the Minister of Finance should be directing his energies.

Consider replacing Stamp Duty with Capital Gains Taxation (CGT).

The intrinsic value of a property might rise by reason of improved infrastructure; access to public transport; motorways; schools; shops etc.

But the main reason is scarcity.

If the bricks and mortar have not increased in value, then no tax should be attached,

However, if the land on which a house is built goes up in value, that is a windfall gain and should be liable to CGT.

Fallow land; empty property and similar should pay an annual tax until such time as it is utilised.

Land hoarding is anti-social and is one of the underlying reasons for the present crisis in the Property Market.

Kenny, in 1963, realised this, and wrote an excellent Paper addressing the problem with well-reasoned solutions.

But the opportunity to address the problem was lost, following a change of government and the usual tinkering that inevitably follows.

To evaluate the tax-free element of any house property being sold, the formula used by The Institute of Chartered Surveyors might be used. It states that the cost of reinstatement, say, following a fire, is the real value of the house. Subtract this figure from the selling price and the difference is what might be subject to CGT - the windfall Capital Profit.