Upcoming Irish property tax to cost 'on average' €1000 per house.(can you afford it?)

tayto lover

dxhound2005 wrote: »

There was an item on Kenny this morning (Myles Dungan filling in) giving the view a few of us are proposing here against the Cant Pay Wont Pay tide. If you want to see how biased this thread is view the poll results.

http://www.rte.ie/podcasts/2012/pc/pod-v-15081215m01stodaywithpatkenny.mp3-pid0-901368_audio.mp3

Before anyone says RTE propoganda just because they allow that view to be aired they gave a CAHWT spokesman full rein to tout some very dodgy mathematics yesterday.

http://www.rte.ie/news/morningireland/player.html?20120814,3366615,3366615,flash,257

Another bit of dodgy mathematics for you -- How could Hogan repay his mortgages of up to 1.2 m on his wages ?

golden lane

dvpower wrote: »

What shady deal are you referring to, and what makes it shady?

i am referring to numerous posts on this thread........

and i am shocked at the treatment of ordinary citizens in many posts.....

they are being made out to be the baddies.........everybody knows who are the baddies in ireland.....

tayto lover

Valetta wrote: »

If getting an interest only mortgage for a number of years is favourable treatment, then I am one of those.

What is your point?

How did he repay those loans of 1.2m approx on his then wages of 80/90k per annum?

bgrizzley

ART6 wrote: »

His arguments were probably the most ludicrous I can ever remember having heard. A tax on property is not a "wealth tax", since the value of one's property has no reflection upon one's income. For example, my house might be worth €200,000, but it costs me money in maintenance and local authority service charges etc. It does not generate any income at all unless I sell it, and even then I have to find somewhere else to live and pay for that out of the proceeds of the sale. It is a wealth on paper only.

Even if the tax were to be based on the value of the property or that of the land on which it is built, what happens in times as of late when property values have declined by southwards of 50%? Do the taxes get adjusted accordingly? Weekly? Monthly? Annually? No a hope in hell -- they will stay at whatever value was decided by the powers that be when the values were at peak, and they will be jacked up every year as a convenient way of stripping even more money out of the pockets of those who actually earn something.

It has been argued in some ignorant quarters that the tax should be based upon what the property could be rented out for, and that is also bewilderingly stupid. Sure, I could rent out my property, but then were would I live?

In the interview it was also suggested that every country in the EU has some form of property tax, and so that makes it alright. It is immaterial whether those taxes are fair or realistic. It is sufficient to state that they exist and so we must have the same. Such taxes create a guaranteed source of revenue. In fact, however they are evaluated, they are a form of income tax. Period. They are income tax because the only means anyone has of paying them is from income, and to suggest that the only alternative would be to increase income tax is typical of the spin and lies invented by the political class.

It can, of course, be argued that the possession of property is an investment (although that has been somewhat disproved of late). That might be reasonable if such things as amortisation and maintenance are taken into account in assessing the investment value. So I could argue that if I bought my property for (say) €200,000 and owned it for five years, during which I paid €5,000 a year on maintenance and amortisation, and then I sold it for €300,000, I have a net gain of €100,000. However, if I have not then paid off the amortisation I do not have any net gain and it has also cost me the maintenance cost. Therefore, I would accept a tax upon the net gain after amortisation with an allowance for maintenance - in other words money that I can put into my bank account and spend. This is not difficult to do -- it is the basis for the taxation system applied to every company in the land, and it is called corporation tax.

What this comes down to for me is that taxes should be based upon liquid assets -- that is those assets like salaries and wages and property sales etc. that result in a net income. Fixed assets that are essential for the continuation of the business or the family should be subject to tax allowances. So any income that is a net worth gain -- salaries, pensions, property sales etc. -- should be subject to tax but not fixed assets until they are sold and become liquid assets. Trying to suggest that there are levels of tax that each pay for local services as distinct from national ones, and should be considered separately is typical of the fraudulent approach of successive governments. All deductions from incomes are tax, whatever the revenue is used for.

I retired at the end of last year. I enjoy the benefit of two small private pension schemes, and a reduced state pension. I pay tax on those and I expect to do so. I do not expect to pay for my fixed asset that I cannot convert into cash.

I vote Art for Taoiseach...

kr7

ART6 wrote: »

His arguments were probably the most ludicrous I can ever remember having heard. A tax on property is not a "wealth tax", since the value of one's property has no reflection upon one's income. For example, my house might be worth €200,000, but it costs me money in maintenance and local authority service charges etc. It does not generate any income at all unless I sell it, and even then I have to find somewhere else to live and pay for that out of the proceeds of the sale. It is a wealth on paper only.

Even if the tax were to be based on the value of the property or that of the land on which it is built, what happens in times as of late when property values have declined by southwards of 50%? Do the taxes get adjusted accordingly? Weekly? Monthly? Annually? No a hope in hell -- they will stay at whatever value was decided by the powers that be when the values were at peak, and they will be jacked up every year as a convenient way of stripping even more money out of the pockets of those who actually earn something.

It has been argued in some ignorant quarters that the tax should be based upon what the property could be rented out for, and that is also bewilderingly stupid. Sure, I could rent out my property, but then were would I live?

In the interview it was also suggested that every country in the EU has some form of property tax, and so that makes it alright. It is immaterial whether those taxes are fair or realistic. It is sufficient to state that they exist and so we must have the same. Such taxes create a guaranteed source of revenue. In fact, however they are evaluated, they are a form of income tax. Period. They are income tax because the only means anyone has of paying them is from income, and to suggest that the only alternative would be to increase income tax is typical of the spin and lies invented by the political class.

It can, of course, be argued that the possession of property is an investment (although that has been somewhat disproved of late). That might be reasonable if such things as amortisation and maintenance are taken into account in assessing the investment value. So I could argue that if I bought my property for (say) €200,000 and owned it for five years, during which I paid €5,000 a year on maintenance and amortisation, and then I sold it for €300,000, I have a net gain of €100,000. However, if I have not then paid off the amortisation I do not have any net gain and it has also cost me the maintenance cost. Therefore, I would accept a tax upon the net gain after amortisation with an allowance for maintenance - in other words money that I can put into my bank account and spend. This is not difficult to do -- it is the basis for the taxation system applied to every company in the land, and it is called corporation tax.

What this comes down to for me is that taxes should be based upon liquid assets -- that is those assets like salaries and wages and property sales etc. that result in a net income. Fixed assets that are essential for the continuation of the business or the family should be subject to tax allowances. So any income that is a net worth gain -- salaries, pensions, property sales etc. -- should be subject to tax but not fixed assets until they are sold and become liquid assets. Trying to suggest that there are levels of tax that each pay for local services as distinct from national ones, and should be considered separately is typical of the fraudulent approach of successive governments. All deductions from incomes are tax, whatever the revenue is used for.

I retired at the end of last year. I enjoy the benefit of two small private pension schemes, and a reduced state pension. I pay tax on those and I expect to do so. I do not expect to pay for my fixed asset that I cannot convert into cash.

This is the most intelligent post on this thread, by a country mile.
Every bit of it true and it's an honest evaluation.

Unfortunately, it'll be shot down by the pro-taxers like any other post that they don't agree with and that's why I'm out of here again.

Well said, art6.
I'll drop back tomorrow for another look.

dvpower

tayto lover wrote: »

How did he repay those loans of 1.2m approx on his then wages of 80/90k per annum?

He sold property - as you already know.

tayto lover

dvpower wrote: »

He sold property - as you already know.

Yes, one of the properties he was paying a mortgage on and which was surely in negative equity. He coincidentally sold it to another F.G. man (the lucky git :rolleyes:) Even if he did sell and paid off one mortgage he was in serious trouble with the others on his wages. So how is it done?

dvpower

tayto lover wrote: »

Yes, one of the properties he was paying a mortgage on and which was surely in negative equity. He coincidentally sold it to another F.G. man (the lucky git :rolleyes:) Even if he did sell and paid off one mortgage he was in serious trouble with the others on his wages. So how is it done?

So don't you think it was just a little disingenuous of you to ask the question when you already knew at least part of the answer.

Anyway, for all I know, he could still be in debt.

tayto lover

dvpower wrote: »

So don't you think it was just a little disingenuous of you to ask the question when you already knew at least part of the answer.

Anyway, for all I know, he could still be in debt.

No i don't.
I would still love to know how its done.
How did these politicians know to go to Fingers for their mortgages? This man has a lot to do with the state of our economy and has still not repaid the 1 million euro he promised to repay, nor does it look like his shady dealings in Irish Nationwide will lead to a prosecution.
All this is relevant as long as people who refuse to pay the HHC on a point of principle or because they genuinely cannot afford it are being referred to as law-breakers especially by someone like Hogan who in my opinion has serious questions to answer himself.

Noreen1

alastair wrote: »

An interest-only mortgage - available to other customers.

But it wasn't an interest only mortgage, was it! It was an interest only loan - to buy property - and they certainly are not available to "ordinary" customers!

(Awaits assurances that there is nothing unusual about that at all!)

noodler

ART6 wrote: »

His arguments were probably the most ludicrous I can ever remember having heard. A tax on property is not a "wealth tax", since the value of one's property has no reflection upon one's income.

I'd have to disagree.

How on earth did people get to own houses or buy houses worth 500,000k+ if not based on their income?

If you owed money that your income couldn't pay (whether to a bank or to revenue) you'd be asked to sell your expensive house, pay your bill and choose a cheaper option.

NOTE: I am not saying that people should sell their house to pay a property tax - the point is the value of someone's house usually IS a good baromoetre of their income.

ART6 wrote: »

Even if the tax were to be based on the value of the property or that of the land on which it is built, what happens in times as of late when property values have declined by southwards of 50%? Do the taxes get adjusted accordingly? Weekly? Monthly? Annually? No a hope in hell -- they will stay at whatever value was decided by the powers that be when the values were at peak,

Thats scaremongering. We don't even know if they will base it on value yet so we certainly do not know for a fact if they base it on purchase prices from 5 years ago.

ART6 wrote: »

In the interview it was also suggested that every country in the EU has some form of property tax, and so that makes it alright. It is immaterial whether those taxes are fair or realistic. It is sufficient to state that they exist and so we must have the same. Such taxes create a guaranteed source of revenue. In fact, however they are evaluated, they are a form of income tax. Period. They are income tax because the only means anyone has of paying them is from income, and to suggest that the only alternative would be to increase income tax is typical of the spin and lies invented by the political class.

Getting a little ideological there. Most EU country countries having one may not make it "alright" in your eyes but it seems a little rich to protect our citizens from it whilst the countries who are funding oru deficit have citizens who pay one.

The number one reason for a property tax is to broaden our tax base in such a way as to make it less susceptible to peaks and troughs.




On a side note, people stop confusinf interes-free with interest-only.

dxhound2005

bgrizzley wrote: »

I vote Art for Taoiseach...

I would fear for the country if this is what he really thinks.

His arguments were probably the most ludicrous I can ever remember having heard

If it's ludicrous for Ireland it's ludicrous for the rest of the world. Everybody wrong Fianna Fail 1977 right. The most ludicrous thing that ever happened was that a developed country abandoned a long established system of property tax. We have suffered the consequences ever since with the inevitable reintroduction happening now.

If the system is so ludicrous how come Europeans setting up new societies in America, Australia etc felt it necessary to import it?

dvpower

Noreen1 wrote: »

But it wasn't an interest only mortgage, was it! It was an interest only loan - to buy property - and they certainly are not available to "ordinary" customers!

(Awaits assurances that there is nothing unusual about that at all!)

Exactly which of the loans are you saying wasn't a mortgage?

Noreen1

noodler wrote: »

I'd have to disagree.

How on earth did people get to own houses or buy houses worth 500,000k+ if not based on their income?

If you owed money that your income couldn't pay (whether to a bank or to revenue) you'd be asked to sell your expensive house, pay your bill and choose a cheaper option.

NOTE: I am not saying that people should sell their house to pay a property tax - the point is the value of someone's house usually IS a good baromoetre of their income.

A: There are very few houses worth 500,000+ at todays prices - though people are still obliged, in most cases, to pay mortgages that are far in advance of the actual market value of the property, and, all too often, on a reduced income.
In short, most people cannot, and could not, afford to buy said houses - that's why they took out mortgages.

B: The value of someone's house was a good barometer, at the time they took out their mortgage. Their income, now, unfortunately, is likely to be considerably less, in most cases.

noodler wrote: »

Getting a little ideological there. Most EU country countries having one may not make it "alright" in your eyes but it seems a little rich to protect our citizens from it whilst the countries who are funding oru deficit have citizens who pay one.

The number one reason for a property tax is to broaden our tax base in such a way as to make it less susceptible to peaks and troughs.

Indeed. However, the fact that our deficit needs to be closed would suggest that the Government is likely to be rather ruthless about the amount each citizen is required to contribute.
In the absence of assurances that "ability to pay" will be considered, then people are naturally concerned.

noodler wrote: »

On a side note, people stop confusinf interes-free with interest-only.

I would suggest that, apart from my typo, for which I have apologised, the other incidences of confusion appear to be obfuscation, rather than confusion, since the posters in question appear to understand the difference perfectly well when it suits their agenda.

lugha

ART6 wrote: »

It does not generate any income at all unless I sell it, and even then I have to find somewhere else to live and pay for that out of the proceeds of the sale. It is a wealth on paper only.

Your property does generate an income, even if no transactions are involved. The income equates with the rent that you would have to pay if you were not in possession of your property.

ART6 wrote: »

Even if the tax were to be based on the value of the property or that of the land on which it is built, what happens in times as of late when property values have declined by southwards of 50%? Do the taxes get adjusted accordingly?

I would expect the total tax take from property would remain more or less constant; thus rates should rise when properties drop in value (and fall then they rise). That would strike me as the sensible way to proceed.

ART6 wrote: »

It has been argued in some ignorant quarters that the tax should be based upon what the property could be rented out for, and that is also bewilderingly stupid. Sure, I could rent out my property, but then were would I live?

I have highlighted the pertinent word in your argument. And yes, if you convert the income generating capacity of your property to cash then you will have to spend that cash to house yourself.

ART6 wrote: »

In the interview it was also suggested that every country in the EU has some form of property tax, and so that makes it alright. It is immaterial whether those taxes are fair or realistic. It is sufficient to state that they exist and so we must have the same.

That is not the reason why what other countries do is cited, as has been pointed out several times.

ART6 wrote: »

Such taxes create a guaranteed source of revenue. In fact, however they are evaluated, they are a form of income tax. Period. They are income tax because the only means anyone has of paying them is from income

I thought all taxes / charges / levies etc. were paid from people’s income? Is there another way?

ART6 wrote: »

What this comes down to for me is that taxes should be based upon liquid assets -- that is those assets like salaries and wages and property sales etc. that result in a net income. Fixed assets that are essential for the continuation of the business or the family should be subject to tax allowances. So any income that is a net worth gain -- salaries, pensions, property sales etc. -- should be subject to tax but not fixed assets until they are sold and become liquid assets. Trying to suggest that there are levels of tax that each pay for local services as distinct from national ones, and should be considered separately is typical of the fraudulent approach of successive governments. All deductions from incomes are tax, whatever the revenue is used for.

There are on going suggestions from some on the no side that the “super rich” should bear the burden of digging us out of the mess we are in. Realistically, you cannot tax their cash deposits so a good opportunity to squeeze them for a few bob is to tax their property.

dvpower

Noreen1 wrote: »

I would suggest that, apart from my typo, for which I have apologised, the other incidences of confusion appear to be obfuscation, rather than confusion, since the posters in question appear to understand the difference perfectly well when it suits their agenda.

Well, after the 'typo' you must be on very firm ground when you say that some of his loans weren't mortgages?
Which ones?

Noreen1

http://www.independent.ie/business/i...n-3161567.html

Phil Hogan, the minister responsible for collecting the household charge, availed of "soft" loans of close to €900,000 that were approved by toxic building society boss Michael Fingleton who has cost the State €5.4bn.
Hogan's unorthodox loans were personally approved by Fingleton to allow him buy a pied-a-terre house in Dublin 4 and a luxurious penthouse in Portugal using two interest- only loans of at least a decade each, an aggressive equity release, and what appears to have been, for his final loan, minimal paperwork.

A loan, in case you hadn't noticed, isn't a mortgage.
Neither is it normal to issue loans with minimal paperwork. Dress it up anyway you like, there are questions to be answered, and Phil Hogan has declined to answer them. Therefore, people naturally wonder why.

Since there are clouds of suspicion about banking practice in this Country over the last decade, surely it is in Phil Hogans interest to clear the matter up, if he has nothing to hide?

dvpower

Noreen1 wrote: »

http://www.independent.ie/business/i...n-3161567.html



A loan, in case you hadn't noticed, isn't a mortgage.

A mortgage is a loan, secured on a property.

Now, are you telling us that Phil Hogan's loans weren't secured on a property i.e. that they weren't mortgages? And if so, can you provide some actual evidence of that?

dvpower

Noreen1 wrote: »

Neither is it normal to issue loans with minimal paperwork.

What paperwork was there? Was it sufficient? What, if any, necessary paperwork wasn't provided?

Do you know the answer to any of these questions or are you just rabbiting what is little more than an opinion piece in a daily rag?

alastair

Noreen1 wrote: »

http://www.independent.ie/business/i...n-3161567.html



A loan, in case you hadn't noticed, isn't a mortgage.
Neither is it normal to issue loans with minimal paperwork. Dress it up anyway you like, there are questions to be answered, and Phil Hogan has declined to answer them. Therefore, people naturally wonder why.

Since there are clouds of suspicion about banking practice in this Country over the last decade, surely it is in Phil Hogans interest to clear the matter up, if he has nothing to hide?

A mortgage is a loan - what else would you think it is?

From the very same article:

His first loan from the society was a standard loan to buy his home in Kilkenny, and both capital and interest were repaid monthly on this €330,000 mortgage.

You seem to be only too eager to get suckered into the Sindo's henny penny nonsense of 'Soft Loans' ie: an interest-only mortgage on the back of existing property equity - a loan that Hogan couldn't sustain in the final analysis and had to offload property to get out of a fix. Not so 'soft', not so 'unorthodox'.

alastair

ART6 wrote: »

I retired at the end of last year. I enjoy the benefit of two small private pension schemes, and a reduced state pension. I pay tax on those and I expect to do so. I do not expect to pay for my fixed asset that I cannot convert into cash.

At least you finally acknowledge it's an asset. Why would you not expect to be taxed on this asset when you used to be? When every other nation taxes you on the same asset, that you could convert into cash if you so desired?

dvpower

alastair wrote: »

A mortgage is a loan - what else would you think it is?

From the very same article:

His first loan from the society was a standard loan
to buy his home in Kilkenny, and both capital and interest were repaid monthly
on this €330,000 mortgage.

And later:

Hogan then leveraged up to buy a luxury apartment in Portugal

So it appears that he got some kind of equity release for the apartment in Portugal of which he is part owner (like so many others - poor sods).

I'm sure Noreen will clear it all up for us. I'm sure she wouldn't be saying that the loans weren't mortgages, not after confusing interest only loan repayments with an interest free loan.

tayto lover

dvpower wrote: »

And later:


So it appears that he got some kind of equity release for the apartment in Portugal of which he is part owner (like so many others - poor sods).

I'm sure Noreen will clear it all up for us. I'm sure she wouldn't be saying that the loans weren't mortgages, not after confusing interest only loan repayments with an interest free loan.

Ignore the Fingleton issue too lads. Sure all was above board and available to the ordinary man in the street too :rolleyes:
We all believe you.

darkhorse

lugha wrote: »

Your property does generate an income, even if no transactions are involved. The income equates with the rent that you would have to pay if you were not in possession of your property.



I had occasion to have my house valued in 2005 and it was valued at €320k. Now, in the meantime, I have maintained it to a fairly good standard. Fast forward to 2011, I had to have a valuation done as I was looking for a top up on my mortgage. This time the house was valued at €180k. Could you please explain to me how my house generated an income.

dvpower

tayto lover wrote: »

Ignore the Fingleton issue too lads. Sure all was above board and available to the ordinary man in the street too :rolleyes:
We all believe you.

What exactly is the 'Fingleton issue' and how does it relate to the Property Tax?

alastair

darkhorse wrote: »

I had occasion to have my house valued in 2005 and it was valued at €320k. Now, in the meantime, I have maintained it to a fairly good standard. Fast forward to 2011, I had to have a valuation done as I was looking for a top up on my mortgage. This time the house was valued at €180k. Could you please explain to me how my house generated an income.

You don't mention what you paid for it in the first place. What's six years rental overhead on an equivalent property? Projected rental overhead for similar property for the post-mortgage years?

alastair

dvpower wrote: »

What exactly is the 'Fingleton issue' and how does it relate to the Property Tax?

Aside from Fingleton signing off on the mortgage (and being a despicable piece of work and therefore a handy bogieman), there doesn't really seem to be much of an 'issue'.

tayto lover

alastair wrote: »

Aside from Fingleton signing off on the mortgage (and being a despicable piece of work and therefore a handy bogieman), there doesn't really seem to be much of an 'issue'.

Fianna Fail Mk 2 just as I thought. Defend "de party to the lahst drop lads". Pathetic stuff. We will never change party politics in this country folks.

alastair

tayto lover wrote: »

Fianna Fail Mk 2 just as I thought. Defend "de party to the lahst drop lads". Pathetic stuff. We will never change party politics in this country folks.

Not a FG member or supporter, and couldn't give a sh1te about Hogan - but I can recognise an uncontentious mortgage loan when I see one.

tayto lover

alastair wrote: »

Not a FG member or supporter, and couldn't give a sh1te about Hogan - but I can recognise an uncontentious mortgage loan when I see one.

So how did he know that Fingleton would fix him up then? How did he know he could go straight to the boss? Did he learn from this guy
http://www.sundayworld.com/columnists/index.php?aid=11290