Sinn Féin propose derelict site compound tax that could reach 35%

Sinn Féin housing spokesperson Eoin Ó Broin is calling for the existing derelict site tax to be increased by 50% every year, as part of efforts to tackle vacancy and dereliction across Irish cities and towns. File picture: Gareth Chaney/Collins

A new derelict site tax that could hit as high as 35% after five years has been proposed by Sinn Féin, as the party sets out its alternative housing plan.

The party’s housing spokesperson, Eoin Ó Broin, is calling for the existing derelict site tax to be increased by 50% every year, as part of efforts to tackle vacancy and dereliction across Irish cities and towns.

This would mean that the existing 7% derelict site tax would rise to 10.5% after a year, before rising again to 15.75% after two.

The party has said that it does not envisage a cap on how high the tax could rise, meaning that after a five-year term in government, property owners could be paying a tax as high as 35.4% of the value of the property.

This means that a derelict site valued at €250,000 would be taxed at a rate of €88,000 in the fifth year of the levy.

Sinn Féin is also proposing a similar compounding tax on vacant properties, which would start at 1% of the house’s value and increase by 50% every year. This means it would rise to 1.5% in year two, before increasing again to 2.25% in the third year.

The current vacant property tax is levied at a rate of three times the local property tax and is charged to homes that are occupied for less than 30 days a year.

As part of the overall plan, which will be launched in September, Sinn Féin is promising to deliver 300,000 new houses across five years.

Of these, 75,000 would be social homes, while 50,000 would be a mix of affordable purchase and affordable rental.

The party says a significant portion of the 300,000 new homes promised would come from the existing derelict and vacant housing stock.

However, Mr Ó Broin could not put a final figure on the number of vacant and derelict properties that would be included, saying that the existing statistics on empty houses are not up to scratch.

Sinn Féin says they plan to address this by establishing a new vacancy and dereliction unit within the Department of Housing, which would be tasked with establishing the exact number of vacant and derelict houses that there are.

A number of estimates are available on vacancy and dereliction, including from Census 2022, which recorded 130,469 houses and 32,964 apartments vacant. 

At the end of last year, GeoDirectory found that there were 81,000 residential and 30,000 commercial properties vacant.