Call for end to home tax ‘rip-off’

YOUNG Fine Gael yesterday demanded an end to an outrageous housing tax rip-off where stealth levies account for 45% of the cost of a new home.

The organisation claimed tens of thousands of home-seekers over 35 are still living with their parents because they cannot get a foothold on the property ladder.

"The Irish tax code is seriously messed up if young people starting out in life are forced to pay 45% in taxes and levies to the government and local authorities," said Young Fine Gael president William Lavelle.

"Given that 74% of new houses bought in 2003 were by under 35s, this is in reality an unfair tax on young people. The Government is deliberately fleecing young people by charging them an outrageous poll tax on their first home."

Mr Lavelle was joined by party leader Enda Kenny yesterday at the launch of a Young Fine Gael nationwide petition to campaign for fair taxes for young first-time buyers.

Deputy Kenny said the exchequer share derived from the new home market increased from 3% to 9% of the country's total tax over the last seven years.

Based on the average €237,000 cost of a new home, an estimated €106,000 goes back to central government in VAT, stamp duties and other taxes, he said.

"The new homebuyer is seen as a soft touch by this Government. They realise that the desire of young couples to get on the property ladder will make them less sensitive to the impact of increased VAT rates, new development levies and all the other charges and taxes," he said.

The Fine Gael figures are based on the Irish Home Builders Association's 2004 Budget submission.

The association pointed out that local development charges alone are topping €16,000 in the greater Dublin area and €12,000 in other parts of the country.

"Ireland's super-rich can get away with paying nothing because of their unregulated use of tax exile and tax-avoidance schemes supported by the Government," said Mr Lavelle.

"Thanks to this government's botched policy on housing and tax, there are over 42,000 people over 35 still living at home because they can't afford to buy their own home.

"We believe in a fair tax system where young homebuyers pay their fair share of tax but not 45%. It's time to end the rip-off."