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News Release

Dublin

Budget 2015 property measures surprisingly tame

JLL Ireland - Reaction to Budget 2015


​DUBLIN, 14th October 2014 – Measures for the stimulation of private sector supply of residential property were surprisingly tame. Apart from the Home Renovation Incentive for rental property, which is welcome, the other commitment that the NTMA’s ISIF will explore ways to promote development, offer no certainty. The allocation of €2.2 billion for a three-year social housing plan, is however welcome and should ease some pressures.
We welcome the lowering of the 80% Windfall Tax for development land down to 33%, as this should assist the release of development land onto the market. After 2 years in operation, it is no surprise that the CGT exemption for property investment has come to an end. It has proven to be successful, and when implemented in 2012, helped stimulate investment activity at a time when it was limited.
We are pleased to see that the Minister did not introduce a kneejerk tax on vacant sites as this would be a very blunt instrument which demonstrates a poor understanding of the economics of development. It is positive to see that this has been avoided in favour of a consultation period.
We broadly welcome the reduction in income tax and USC relief which should be positive for the retail sector as is likely to improve consumer spend and sentiment.
The introduction of the Knowledge Development Box will consolidate Ireland’s FDI position, which we would welcome from a property perspective as it is likely to continue to attract international corporations, as will the reinforcement of the 12.5% Corporate Tax Rate. It is too early to say what the impact of the removal of the “Double Irish” arrangement will be. We will however, be closely watching the reaction of international corporates to the phased-removal of this arrangement.
It is positive to see the 9% reduced VAT in tourism-related activities will remain. This will support the recovery in the Hotels and hospitality sector.
John Moran, Managing Director at JLL said that “This is the first positive step in a significant amount of work that needs to be undertaken to stimulate the economy. We were expecting more direct measures to stimulate the provision of much-needed housing and modern offices. People in employment need houses and people in houses need employment. Fixing this imbalance is urgent and we would call for further initiatives before the next Budget.”

- Ends


Contact: Gillian Murtagh
Phone: +353 (0) 1 673 10717
Email: gillian.murtagh@eu.jll.com