Tax breaks for developers would be a return “to the dark days”, the Dublin Renters’ Union has said.
No new initiative was introduced in September’s budget but Green party leader Eamon Ryan said last week that he would not “rule out” any measure that could help ease the housing crisis.
Developers have long argued that reducing the amount of tax they pay would allow them to deliver more homes and Conor O’Connell of the Construction Industry Federation urged the Government to consider such a measure.
“We need to build more homes for more people,” he told Newstalk Breakfast.
“At the moment, one of the biggest significant factors surrounding the constrained supply of homes is the cost of delivery.”
Since Russia’s invasion of Ukraine, the cost of building materials in Ireland has soared and the sector says it is putting development at risk.
“Over the last three or four years, we’ve gone through some exceptional times in the construction industry in relation to delivery costs,” Mr O’Connell added.
“Whether that’s the availability of materials [or the] cost of materials and it has increased very significantly.”
However, Peter Dooley, co-founder of the Dublin Renters Union, said that a tax cut for the construction industry would not solve the housing crisis.
“I find it remarkable that this conversation is starting again,” he said.
“We don’t have to reinvent the wheel; [Fianna Fáil TD] Barry Cowen spoke in 2017 about a ‘real urgency’ for a VAT cut for builders.
“This is going back to the dark days of Fianna Fáil, the days of the Galway Tent and giving more tax breaks to developers.
“In terms of affordability for people buying or renting, these tax cuts aren’t being passed in terms of the delivery of housing for people.”
Instead he queried, “Why can’t the profits [of developers] be regenerated back into helping workers?”
Last week, Daft.ie released data that revealed rent in Dublin has surged by 14% in a year because of a “dramatic fall off” in rental properties.
Main image: Newly built homes in Killarney. Picture by Alamy.com