Mistake Costs Ireland Millions in Property Tax Revenues

November 12, 2013 Taxation In EuropeTaxation in Ireland

Ireland Property TaxDUBLIN – Home buyers in Ireland are set to receive an unexpected tax break due to a poorly worded tax law.

In a statement issued over the weekend, the Office of the Revenue Commissioner of Ireland revealed that an oversight in the country’s tax legislation has mistakenly exempted thousands home buyers from paying stamp duty on the purchase of houses.

Earlier this year legislation came into effect exempting taxpayers from paying local property taxes, on residential properties purchased by first-time buyers any time before 2016.

However, the wording of the legislation was too ambiguous, and the Office admitted that the law could be interpreted as applying to any person purchasing a property for use as their primary residence.

It is estimated that approximately 10 000 individuals who purchased property in 2013 will qualify for the exemption, despite originally not falling under the intended scope of the legislation, leading to an estimated loss in tax revenues of several million.

The legislation will not be rectified and the exemption will be actively offered to all property buyers for the next three year.

According to the statement by the Office, no new measures will be implemented to make up for the revenue shortfalls arising from the decision to maintain the exemption.

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