Finance minister rules out tax breaks for property developers that previously 'did such harm'

'What I’m not going to do is reintroduce or propose the very tax reliefs that did such harm to our economy and then the building of homes for many years in Ireland,' Paschal Donohoe said

Finance Minister Paschal Donohoe has ruled out the reintroduction of broad tax breaks for developers to stimulate housebuilding as they previously "did such harm to our economy".

His comments appear to contradict Taoiseach Micheál Martin, who floated the idea of such tax breaks last week.

Senior government ministers are due to meet at 4pm on Monday afternoon afternoon to discuss further measures to improve housing delivery across the country, with sources indicating “everything” is on the table.

Mr Donohoe raised concerns about proposals to reintroduce Section 23-style tax breaks — which, during the Celtic Tiger, offered developers relief for building or refurbishing apartments in specific areas.

“What I’m not going to do is reintroduce or propose the very tax reliefs that did such harm to our economy and then the building of homes for many years in Ireland,” Mr Donohoe said.

“The Section 23 reliefs, broad reliefs that are in place to stimulate the delivery of additional homes, we have already identified proved to be very, very costly.

“We’ve already acknowledged that it’s very difficult to identify how they can be targeted. I don’t believe those policies are the way in which we will make progress in the delivery of more homes.” 

Mr Donohoe said he believed there were “alternative ways” to achieve the goal of building more housing.

“We can reconsider where we are with how we fund infrastructure, we can reconsider where we are with our planning frameworks. 

But what I will be strongly making the case for is we should not bring in and reintroduce the reliefs that proved so costly and did such harm a number of years ago.

He added there needed to be a “stable tax and policy framework” where developers can operate.

“Reintroduction of those reliefs is not a way which we will do it,” Mr Donohoe said.

A number of options are due to be discussed by ministers on Monday afternoon, including a new “clearing house” for water and energy connections that would work between builders and Government agencies such as the ESB and Uisce Éireann.