THE DECISION OF the outgoing government to delay property tax revaluations has been slammed by Europe.
The European Commission – the executive body of the European Union – has hit out at the move, saying that it could have been key to broadening Ireland’s tax base.
Back in October last year the government announced that the level of Local Property Tax, which was due for review this year, would remain frozen until 2019.
Hitting out at this, the annual report on Ireland’s finances said:
This decision represents a lost opportunity to broaden the tax base as residential property prices have increased substantially since the first self-assessment in 2013.
Its release was delayed until 10pm yesterday evening, just as polls were closing around the country.
What problems do we still have?
Beyond issues with property tax, the report zeroed in on other weak points in the Irish economy.
Although economy growth has been impressive, the GDP growth figures over the past two years have “probably overestimated the strength of the recovery”.
The big role that multinational companies play in the Irish economy leaves it open to external shocks, it noted.
Legacy issue from before the 2008 economic crash were also seen as a problem, with Ireland continuing to experience high levels of public and private debt.
Ireland still has one of the highest ratios of non-performing loans in the euro area.
The Good
Despite these negatives, it wasn’t all doom and gloom.
Ireland was praised for its “remarkable” recovery over the past two years having been “among the European countries most severely affected by the economic crisis when the real estate bubble burst in 2008″.
It was also noted that the recovery was job rich and that the unemployment rate had dropped to less than 9%.
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