Should we consider scrapping any gains tax on sites temporarily?

If we are to look at housing (at least in Dublin) as being of a crisis nature then perhaps we should consider some bold moves that might bring land into play that otherwise wouldn’t make it.

The talk of a site tax is a good idea, it was the tax we were meant to get from the beginning before the government reneged on their stance for it. This will help create a ‘use it or lose it’ aspect to land holding. The second trick is to encourage movement.

Scrapping the 80% windfall tax would be a start, but most of the site with planning don’t fall into that category, so perhaps scrapping Capital Gains Tax on any site sold (with planning) in 2014 would be a start. The reason for this, and the issue it intends to resolve, is that many sites have insolvent owners, or people too highly leveraged to make the site viable.

Getting rid of the 33% tax (which is harsher than it used to be because the tax …

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Talking property tax on WLR FM

We spoke to WLRFM yesterday (sound file here) about some of the contentious issues with a market value based property tax. Using values will ensure that the quantum collected is not strictly linked to any costs associated with running a local authority.

In the past this was a huge problem, it was the reason our last property tax died off, and when it came to domestic rates, it was used as political fodder in the 1977 general election where its repeal swung the election.

There are alternatives, Site or Land value tax and to have the tax linked to costs of a local authority would be far better, but we are instead opting for the path which suits the Government most rather than those who pay it.

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Irrational banking, non-competition creating profits unexpectedly.

That banking in Ireland is a little irrational at present is a given, however, there are occurrences in the market which will change pricing structures in the near future, interestingly, by trying not to compete for business, several banks will ultimately make the market more profitable for all of the banks, achieving almost the opposite of what they had hoped to do.

I’ll explain, at the moment we have seen widespread Sovereign Credit Retrenchment, that’s a fancy way of saying that banks who are bailed out by certain countries are only really focusing on their indigenous markets because it is those markets that bailed them out. Irish banks have done this, Irish owned UK operations are closed. Equally, UK banks here are doing this by making their existing business rates higher and their new business rates exceptionally high.

Bank of Scotland’s new business variable rate is 6.19%, a whopping 5.19% over the ECB, they are doing this to avoid lending, and they are also paring back LTVs so that you have to have greater equity in the deal to borrow, …

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Renting vs Buying a Home

This is an interesting two part video, it was first published in early 2008, before the property crisis really got into full swing, this video should help anybody understand some of the reasons for renting being better than buying. This is an Amercian video so there are things such as property tax which we don’t have in Ireland (annually, some people still pay a front loaded property tax called ‘Stamp Duty’), but the rational remains the same, you need to do your sums

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