THE GOVERNMENT is being urged to adopt a new property tax based on site values, covering all commercial, industrial and domestic properties, as a means of raising revenue and stabilising the market.

This approach is being advocated by a number of bodies, including the Urban Forum, which involves architects, engineers, planners and quantity surveyors, and Feasta, the Foundation for the Economics of Sustainability.

An annual land tax is also being considered by the Commission on Taxation, which may include it in its eagerly-awaited report to the Government later this year. According
to Mr Pike, it would replace stamp duty and commercial rates.

Economist Dr Constantin Gurdgiev, lecturer in finance at Trinity College and former head of research at NCB Stockbrokers, is fleshing out the proposal for the Urban Forum, with a view to submitting a detailed report to the commission.

In terms of its impact on housing, Mr Pike said the land, or site value, tax “could be as high as domestic rates or it could be lower”. He believed it would generate at least “a couple of billion euro a year”.

Mr Pike noted that the idea of taxing land, first advanced by American social reformer Henry George in the 19th century, had been “applied quite widely” in the US and Canada, where land values were “very modest” as a result.

Had it been applied in Ireland, he said we could have avoided the “mad frenzy” among developers paying exhorbitant prices for sites in Dublin.

Original Article