I would suggest the installation of meters in all areas currently under pressure such as the GDA (quantity) and Galway (quality). Recipients of meters could be promised that they would pay flat rate for 10 years while meters are being rolled out, but that they would receive statements of use.

How would that help? First, aggregating property usage would help find leaks in the trunk system, hopefully avoiding the need for massive projects like obtaining water from the Shannon basin. Second, it would provide a firm basis for average household use so that when water charges are rolled out, the householder would have an expectation of how much it would cost. Thirdly, over those ten years a householder could address leaks on their own property or invest in lowflow fittings.

If a farm doesn’t generate a rateable income, perhaps it should be sold so to those that can expand their own holdings and improve returns. Subsidizing a black hole or black bog makes as much sense to me as pouring money into a toilet. There was a time in living memory when a farm of 250 acres could support ten men. I am not advocating that type of life, those wages, the semi-mechanical technology of the day or the social fabric but just stating a fact. The Land Commission did a great deal of economic damage to achieve political ends.

While we are at it a self-propelled potato harvester (Danish model it will do more than spuds)) runs to about €450k at the moment. You need a lot of land to make that pay. A relation of mine bought one recently, so there is some money in farming if you approach it like a business as opposed to a hobby (spuds etc. are not CAP suckled enterprises).

On water meters and certification - this technology looks super cool

http://techcrunch.com/2010/07/14/new-york-city-to-keep-track-of-water-use-with-wireless-monitors/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+Techcrunch+%28TechCrunch%29

Granted there is the difficulty in introducing annual property tax after people have paid stamp duty. In addition people may be holding off buying a property as they do not want to get hit by a double wammy of stamp duty and annual property taxes.

Why then is there no solutions being aired about this conundrum. Stamp duty was high but only for purchasers of second hand homes, if one purchased a new home the stamp duty was much lower. Could a credit be introduced, for example if annual property tax is 500E for your 3 bed semi and you had previously paid 15,000 in stamp duty then that gives you 30 years of free payments at the going rate of 500E / annum.

As the annual property tax is increased over the next 10 years to 1,000 per annum then the 30 year time span would shorten.

In addition if one was to sell the property then you would be unable to transfer your remaining credit from your previous property to your new one.
You would be resetting the clock so to speak.

2. On water tax, does this mean that users with their own private water supply don’t get taxed? (eh, me)

3. I don’t like the instinctive rush to beat up farmers? Have you seen their incomes? The price of agricultural land is a factor (like every other product) of its availability in the market. Farming land rarely comes on the market because through the single farm payment elderly landowners have no incentive to sell it. Perhaps this might be offset by a land tax, but then you have a tax and a subsidy cancelling each other out. It seems to me land reform is a bit more complex than taxing the land. Reversing the decoupling would be more practical, but then that has its problems too.

4. I think the biggest problem with a property tax is that so many people paid such high stamp duty they will react furiously to the notion that they have to pay more. They have paid a property tax (though this is a generational issue too, and these are the same people already coming off badly).

@Richard, re. housing valuation: I always liked the Greek antiquities valuation law. You self-value the object, and pay whatever percentage of that as tax. If Revenue-equivalent think you’ve undervalued it, they can buy it off you at that price. Encourages a certain level of honesty, one would think. “,)

It would be interesting to learn what happened in Sweden.

Rather than hurting average prudent savers, the target might be to disadvantage (slightly) those with massive piles of dosh where it is sitting there but doing nothing productive. Same philosophy as taxing people hoarding development land for speculative purposes.

Just on a side point, Yes you are correct in your statement of the 200E, and it is for each property which you own, not just your second.

Hence if you own 6 properties, then its 200 x 6 = 1200 per annum.

What I find a tad unfair is that if your property is part of a private estate, then you are being hit with a double penalty, the NPPR tax of 200E and the management fee of servicing the estate, lighting, gardening etc.

Soon some landlords will be facing financial annihilation as the Govt seeks to reduce rental subsidies for social welfare tenants (due to the fact that the cost of living has come down and also because we are broke), and banks seeking to remove interest only tracker mortgages. A double edged sword so to speak. Of course if Labour obtain the reigns of power (which may be sooner than we think) then they will be free to remove the cost of mortgage repayments in calculating profit or loss.

Courtesy of the Labour party, 100% Taxation on a loss will occur for these investors, and other investors had better watch out, because they might be next.

In general I think savings are a good thing, and taxing them too heavily to encourage spending may not achieve what you hope for, take 2008/09 for Irish banks, so hungry for deposits that they were paying up near 6%, if you taxed that at 50% the 3% gain would be easily found in another jurisdiction, or in bonds/blue-chip dividend payers and essentially the banks would have just ratcheted the rate up further to capture that money. Hoarding is a natural thing to do when hard times are likely, squirrels do it every year coming up to winter, so you it would be tricky to discourage it for people, as well as that, savings have been a vital part of easing the pain of wage cuts etc. and although our savings rate spiked, it has previously been too low.

I’d side with the monetarists on stimulus, just increase money supply, obviously that route is not open to us but ECB are doing a good job of keeping the cogs turning and rates are staying at a historic low and likely to remain there for some time.

there already is a 200 euro tax on 2nd (and presumably 3rd etc) residences.

If you really wanted to set the cat among the pigeons you could start charging rates to rental properties as commercial businesses (which they are) albeit at a lower rate.

The really hared decisions will be left to Taoiseach Gilmore after the next election. He will rapidly turn in to an Irish Papandreau within about 6 months when he has to break every promise he made and slash and burn.

Local authorities are not to my knowledge charging rates for empty commercial properties at the moment.

Not so.

On a related taxation topic: there have been interesting historical experiments in which savings were taxed rather than rewarded with interest.

Stimulus w/o debt creation?

On the property side I think a Site Value Tax would be a great addition to the system, the near zero carry cost of property actually sets the stage for a boom-bust cycle, in particular when you can make a gain with little or no labour/input. We socialise our incomes via income tax but privatise the social income that public spending creates in site values. It’s a conundrum, and the thing that confuses me most is why such policy is not more actively pursued?

Agree re: need to set income free. We need a tax structure that *discourages* speculative activities that do not add value (e.g. when an existing house or building changes hands w/o any value added since it was previously purchased other than inflation, or speculative foreign currency transactions–recognizing that the latter only make sense when applied on an international basis)

Accept low likelihood of anything like this happening, but we need to at least start identifying activities that are only gambling vs activities that add value. Adjusting for inflation vs speculation?

Adding new capital to a company adds value. Does trading those shares afterwards truly add value other than speculation? (It can be leveraged to get more value for new capital–but other than this does it add value?)

There are grey areas here. They’re hard to disentangle and controversial.

Taxation policy should strive to differentiate between value-added transactions vs gambling, and treat the two differently. Income generating (value-added) activities should have lower or no tax. Speculative activities should be taxed at a much higher rate.

We’ve become too accepting of purely speculative transactions that have weakened our economic infrastructure, nationally and internationally.