Ireland: Deloitte says government should keep property tax break
22 September 2014
Posted by: Author: Colm Kelpie
Author: Colm Kelpie (Irish Independent)
Accountancy giant Deloitte is pushing the government to retain a capital gains tax break on properties that have been held for seven years for regions outside Dublin.
Finance Minister Michael Noonan has said he plans to scrap the measure in Budget 2015.
The minister introduced the measure in 2011 to attract international investors and give a boost to the then beleaguered commercial property sector. Mr Noonan extended it for a year at the last Budget in October, but he said there was now no longer any need for it.
Deloitte Ireland's head of tax and legal services, Padraig Cronin, said the measure should be scrapped for Dublin, but retained for at least a year to help the recovery in the regions.
"To extend this for an additional year may allow investors to commence purchasing properties in areas that have yet to benefit from this measure," Mr Cronin said. The CGT relief for the first seven years of ownership, for properties purchased between December 7, 2011, and December 31, 2013, was extended by one year to include properties bought up until the end of 2014.
When a property is bought in this period and held for seven years, the gains that it has accrued will not be subject to CGT.
Mr Cronin also said that the entrepreneur is overtaxed in Ireland and said measures needed to be taken to address this.
More broadly, Mr Cronin said that a general givewaway in the Budget should be avoided.
"It would be better to give a rebate that is directly linked to increased economic activity and/or a socially desirable objective," he said.
"For example, incentivising consumer spending on health/wellness and education would have a lot of positives."
This article first appeared on independent.ie.