Property tax, what the hell?

desertcircus

I still don't quite understand why people are angry about this. Would it have been okay to raise VAT or PAYE to raise the same amount? We pay taxes, and this particular one is probably more defensible than an income tax hike or a reduction in welfare funding.

Twoandahalfmen

Tax

Grandpa Hassan

desertcircus wrote: »

I still don't quite understand why people are angry about this. Would it have been okay to raise VAT or PAYE to raise the same amount? We pay taxes, and this particular one is probably more defensible than an income tax hike or a reduction in welfare funding.

I think it would be more acceptable if it were like that in other countries. ie. a tax based on residency, irrespective of whether you're a tenant or an owner. It's the inequity of this that riles me. In that tenants get off scot free. I'd would be 100% behind a UK style council tax

djimi

Grandpa Hassan wrote: »

In that tenants get off scot free.

In what way? You think these charges wont be passed down to tenants in the form of a rent increase?

bacon?

Shedite27 wrote: »

What are the property tax rates where you are?

No idea, traveling around Asia at the moment.

Shedite27

Grandpa Hassan wrote: »

...a tax based on residency, irrespective of whether you're a tenant or an owner...

Let me guess, you're an owner?

Grandpa Hassan

Shedite27 wrote: »

Let me guess, you're an owner?

I am both an owner and a tenant, having been forced to move with work

And to Djimi, yes, I will be passing this on to my tenants, but it would have been a hell of a lot easier, more effective, and straightforward to police, if the government had just done a residence based tax in the first place!

djimi

Grandpa Hassan wrote: »

And to Djimi, yes, I will be passing this on to my tenants, but it would have been a hell of a lot easier, more effective, and straightforward to police, if the government had just done a residence based tax in the first place!

Youre not wrong about that, but its hardly the same as saying that tenants will be getting off scot free! Indeed, its not hard to see tenants getting the raw end of the stick when it comes to this (how many landlords do you think will try and up the rent an even €50 a month to cover a €300 tax?)

Borderfox

hfallada wrote: »

Ireland is the one of the only economies in the OECD without a property tax. It will only will be a small fraction of the total Government revenue. There was an article in the Irish times how people have put up with massive VAT and excise duties increases which have made everyday items so much more expensive yet few people care.

If you want quality services expect to pay for them.

We don't have quality services

OldNotWIse

Phoebas wrote: »

Don't forget to declare your rental income for tax purposes too.

Good point. I asked landlord for details a while back for filling out rent relief form (didnt realise the b*stards were phasing it out at that stage) and was told, "oh no that wont be possible- in other words - no declaration of rental income. I worry sometimes what would happen if I lost my job - how would I claim rent allowance while finding another if property not registered??

Having said that, rent is low so neither myself or OH want to rock the boat.

Phoebas

Grandpa Hassan wrote: »

I am both an owner and a tenant, having been forced to move with work

And to Djimi, yes, I will be passing this on to my tenants, but it would have been a hell of a lot easier, more effective, and straightforward to police, if the government had just done a residence based tax in the first place!

It would be much more difficult to implement and enforce if it was done on residents rather than owners (or from a Revenue pov, their properties).

Tenants are very mobile whereas properties tend to stay put. Its much more difficult to extract tax from an individual that can move from property to property and even move abroad that from a property owner who can't dispose of the property without clearing outstanding taxes.

Phoebas

Borderfox wrote: »

We don't have quality services

... because they were funded by the magic revenue pot where the taxpayer hadn't a clear notion about how much they we're paying for local services and the people who were spending the money had no power over the raising of the money.

I expect at the next local elections, prospective councillors are going to get grilled about Property tax and what they are going to do with taxpayers money.

Grandpa Hassan

Phoebas wrote: »

It would be much more difficult to implement and enforce if it was done on residents rather than owners (or from a Revenue pov, their properties).

Tenants are very mobile whereas properties tend to stay put. Its much more difficult to extract tax from an individual that can move from property to property and even move abroad that from a property owner who can't dispose of the property without clearing outstanding taxes.

It seems to work very well elsewhere

Phoebas

Grandpa Hassan wrote: »

It seems to work very well elsewhere

... and it works even better the way we did it here. The Revenue managed to introduce a whole new tax in less than a year with huge compliance figures.

desertcircus

Grandpa Hassan wrote: »

I think it would be more acceptable if it were like that in other countries. ie. a tax based on residency, irrespective of whether you're a tenant or an owner. It's the inequity of this that riles me. In that tenants get off scot free. I'd would be 100% behind a UK style council tax

The obvious counterpoint is that the tenant is effectively subsidising the landlord's capital acquisition and that it seems unfair to charge the person who's paying the bulk of the mortgage without getting any equity.

Grandpa Hassan

desertcircus wrote: »

The obvious counterpoint is that the tenant is effectively subsidising the landlord's capital acquisition and that it seems unfair to charge the person who's paying the bulk of the mortgage without getting any equity.

So they should call it a straightforward wealth tax. Instead of sticking with this 'local services' charade!

Shedite27

Grandpa Hassan wrote: »

So they should call it a straightforward wealth tax. Instead of sticking with this 'local services' charade!

You could call everything wealth tax so...
Bigger car... more tax
More income.... more tax
More purchases... more tax

It only follows suit that the wealthier people have more valuable houses so should pay more tax.

washman3

Phoebas wrote: »

. The Revenue managed to introduce a whole new tax in less than a year with huge compliance figures.

How much have they recouped from Johnny Ronan,Bernard McNamara,Derek Quinlan,Bailey brothers,Sean Dunne,Fingers and Seanie, etc,etc,etc.

Phoebas

washman3 wrote: »

How much have they recouped from Johnny Ronan,Bernard McNamara,Derek Quinlan,Bailey brothers,Sean Dunne,Fingers and Seanie, etc,etc,etc.

In LPT? I've no idea.
Did you want to discuss the Property Tax or just have a general whinge?

murphaph

desertcircus wrote: »

The obvious counterpoint is that the tenant is effectively subsidising the landlord's capital acquisition and that it seems unfair to charge the person who's paying the bulk of the mortgage without getting any equity.

The tenant is doing no such thing. The tenant is paying the landlord for a service and the landlord is providing that service. There's no subsidy. A roof over your head costs money no matter what way you go about it. You can pay a landlord rent for it or you can pay a bank interest for lending you money to buy your own.

In Germany the property tax can be passed on in full to the tenants as long as it's specified in the lease (not many leases fail to specify it!). The UK uses a slightly different system but ultimately the tenant also pays (in a more direct way). Why should Ireland be any different?

Grandpa Hassan

murphaph wrote: »

The tenant is doing no such thing. The tenant is paying the landlord for a service and the landlord is providing that service. There's no subsidy. A roof over your head costs money no matter what way you go about it. You can pay a landlord rent for it or you can pay a bank interest for lending you money to buy your own.

In Germany the property tax can be passed on in full to the tenants as long as it's specified in the lease (not many leases fail to specify it!). The UK uses a slightly different system but ultimately the tenant also pays (in a more direct way). Why should Ireland be any different?

And the landlord is paying tax on the income earned already

As other posters have said, the tenants could ultimately get screwed even more here. Landlords may well put up the rent by a nice round £50 a month, which is more than the charge. If the charge were levied directly on residents, or legislation put in place to allow landlords to pass on the charge in the lease, then the tenants cost would be limited

NIMAN

Citizen in "I don't like paying tax" shocker.

washman3

Phoebas wrote: »

In LPT? I've no idea.
Did you want to discuss the Property Tax or just have a general whinge?

Already gave my opinion (and probably the opinion of the majority of Irishowners) in post #16 on the LPT which you also dismissed as an 'uninformed rant'
Then you praise the revenue for the excellent job they are doing collecting this tax. My point is why cant they collect the millions owed to the Irish taxpayer by Government cronies and vested interests. Maybe then it would be easier to convince the ordinary taxpayer that this is a fair and just tax.
Remember Enda's famous pre-Election rant 'it is unjust and immoral to tax a family home';)

Shedite27

washman3 wrote: »

...Remember Enda's famous pre-Election rant 'it is unjust and immoral to tax a family home';)

That was 1994! 20 years ago. A LOT has changed since then

Pawwed Rig

Grandpa Hassan wrote: »

As other posters have said, the tenants could ultimately get screwed even more here. Landlords may well put up the rent by a nice round £50 a month, which is more than the charge.

Ah this old chestnut. I see it has been mentioned three times already on this thread. Some people here seem to think that a landlord sets the rental price in this country. That is most definitely not the case. The market sets the rental price. If a lone landlord or even 10% of the landlords in Ireland suddenly decided to raise their rents by €50 a month then they would find out pretty quickly that 1. their tenant was moving out and 2. that it will be next to impossible to get a new tenant as they have priced themselves out of the market.
In a few areas of the country rents are rising. Now some will put this down to LL's passing on the property tax but the reality is in these areas there is a shortage of supply so the market price is rising. In the majority of the country rents are still falling.

Bullseye1

Phoebas wrote: »

In LPT? I've no idea.
Did you want to discuss the Property Tax or just have a general whinge?

It is funny that government failure to bring people to justice is seen as a whinge.:rolleyes:

Grandpa Hassan

Pawwed Rig wrote: »

Ah this old chestnut. I see it has been mentioned three times already on this thread. Some people here seem to think that a landlord sets the rental price in this country. That is most definitely not the case. The market sets the rental price. If a lone landlord or even 10% of the landlords in Ireland suddenly decided to raise their rents by €50 a month then they would find out pretty quickly that 1. their tenant was moving out and 2. that it will be next to impossible to get a new tenant as they have priced themselves out of the market.
In a few areas of the country rents are rising. Now some will put this down to LL's passing on the property tax but the reality is in these areas there is a shortage of supply so the market price is rising. In the majority of the country rents are still falling.

LLs will still try. And I think they should, to the best of their ability. I have increased my tenants rent. But only to the value of the tax, which works out to bugger all per month between the two of them. But its the principle of the thing....the government says it is to pay for local services....and they are the local residents using said services

djimi

Pawwed Rig wrote: »

Ah this old chestnut. I see it has been mentioned three times already on this thread. Some people here seem to think that a landlord sets the rental price in this country. That is most definitely not the case. The market sets the rental price. If a lone landlord or even 10% of the landlords in Ireland suddenly decided to raise their rents by €50 a month then they would find out pretty quickly that 1. their tenant was moving out and 2. that it will be next to impossible to get a new tenant as they have priced themselves out of the market.
In a few areas of the country rents are rising. Now some will put this down to LL's passing on the property tax but the reality is in these areas there is a shortage of supply so the market price is rising. In the majority of the country rents are still falling.

Its hard to see a situation where rents dont rise nationally to reflect this property tax. If a landlord does not raise the rent for their current tenant, you can be sure that they will look for more from the next tenant if they end up re-letting, so for most tenants its going to be a case of taking the €30 (or whatever) hit in their current place, or moving out and most likely taking it somewhere else. Now if their current landlord decides to round up and ask for €50, well then the tenant has a choice of either accepting it, or moving out and paying the extra €30 somewhere else, and going through all the hassle of moving for the sake of €20 a month. This is why I can see a lot (not all by any means) of landlords chancing their arm with this charge. A €50 increase is most likely not going to price them out of the market, not if consider that most new rentals will probably up their price to reflect the charge.

Phoebas

Bullseye1 wrote: »

It is funny that government failure to bring people to justice is seen as a whinge.:rolleyes:

Its hilarious that some people think that developers and bankers as a class need to be 'brought to justice'. :rolleyes::rolleyes:

Pawwed Rig

Grandpa Hassan wrote: »

LLs will still try. And I think they should, to the best of their ability.

Yes, a landlord should be attempting to maximise his return but this has nothing to do with the property tax.

djimi wrote: »

you can be sure that they will look for more from the next tenant if they end up re-letting, so for most tenants its going to be a case of taking the €30 (or whatever) hit in their current place, or moving out and most likely taking it somewhere else.

This ignores economics though. The laws of supply and demand would disagree with your points. Some landlord will try to price above the market and others will price below the market. All things being equal the cheaper houses will go first with the more expensive houses being vacant for longer ie costing the LL more.
By your rationale any LL who is getting less rent that the value of their mortgage would simply up the rent. Therefore in a time of mortgage interest rate increases rents would increase. This is simply not the case.
If a landlord did chance their arm sticking in a non material increase to a tenant in an area where rents are falling then if the tenant refuses I can guarantee that the LL will back down. If in an area where rents are increasing then the tenant may have to pay or move out. Again neither has any relation to any tax.