A TOTAL OF 298 sites across 17 local authorities in Ireland will be subject to the vacant sites levy, effective from 1 January.

The tax was introduced under the Urban Regeneration and Housing Act 2015, in an attempt to try to bring vacant land in urban areas back into beneficial use at a time when homelessness is at record levels, as is the cost of rent in Ireland. 

It applies where planning authorities can designate a site liable under the levy where it has remained vacant and site owners/developers failed under certain conditions to bring forward reasonable proposals to develop or reuse the site. 

The rate that a property owner pays is based on its value. While initially set at 3% of the site’s value, some property will also be liable for a 7% rate annually. 

Responding to a parliamentary question late last year, Minister for Housing Eoghan Murphy said: “I understand a total of 17 planning authorities have populated their vacant site registers with 298 sites, of which over 140 were on registers on 1 January 2018 and in respect of which the levy can be applied in January 2019, unless development works are activated in the interim.”

Murphy said his department had actively engaged with local authorities in relation to the implementation of the vacant site levy in order to ensure a “consistent application of the levy provisions across all city and county areas”. 

However, if a site owner receives a notification from the local authority demanding payment of the levy, they can appeal the decision to An Bord Pleanála within 28 days of receiving the demand. 

Murphy added that the department will also monitor its implementation to see how effective the levy is at achieving its aim of “incentivising the development of vacant or under-utilised sites in urban areas”. 

An independent report commissioned by the government last year advised against the introduction of a vacant property tax that would be separate to the vacant site levy.

Indecon consultants were tasked by the Department of Finance to conduct an examination of introducing such a tax and the impact it might have in increasing the available housing stock on the market.

In theory, the report states that a vacant property tax “could re-activate significant segments of the existing housing stock” but it found that the reasons for vacancy are wide-ranging. 

If government do decide to press ahead with such a tax in the future, the report states that “careful consideration” must be given to design the appropriate criteria for its implementation. 

It added that the level of the tax would need to be very high in order to have any impact on the incentives of the owners of vacant properties and exemptions should be granted for those properties which have a legitimate reason for vacancy.

With reporting from Christina Finn