CIF wants zero per cent stamp duty

The Government must make job retention and development a primary goal of its four-year budgetary policy, the Construction Industry Federation (CIF) said today.

Speaking at the publication of its' pre-Budget submission, the organisation's director-general Tom Parlon warned of further job losses next year if there are cuts in capital investment. He also urged the Government to address deficiencies in the tax system to encourage renewed private-sector investment in the economy.

“The Government’s fiscal consolidation targets for the next 4 years won’t be achieved without economic and employment growth. If this is to be achieved, the Government has to protect productive spending in the Budget," said Mr Parlon.

"The Capital Investment Programme is particularly crucial in this regard. Cutting capital investment again will only serve to further depress economic activity and as has been illustrated over the past two years, put more pressure on the Exchequer as a result of further unemployment. Cutting productive investment is a false economy," he added.

In its submission, the federation calls for a time limited 0 per cent stamp duty rate on all property transactions as a revenue-generating measure. It says stamp duty could eventually be phased out and replaced by "a more reliable, sustainable and equitable form of taxation."

“There are a range of measures that the Minister can introduce, at no cost to the Exchequer, to help support the economy. A good example is stamp duty. Persisting with a high transaction tax when there are no transactions makes no sense, either from the economy’s or the Exchequer’s perspective," said Mr Parlon.

"Introducing a 0 per cent stamp duty rate may encourage more interest in commercial and residential property transactions and therefore generate additional incomes for the State.”

The federation says the Government should also consider a time-limited tax credit or savings scheme, to facilitate new home ownership amongst first time buyers and calls for an extension of the mortgage interest relief plan.

A range of measures are recommended to help control and counter an alleged resurgent black economy in construction. This includes a requirement to inform Revenue of the commencement of any construction project with costs of €3,000 or more, and for the payment of building grants to be made conditional on work being carried out by tax compliant contractors.