Major changes to stamp duty on houses are to be considered today by the Progressive Democrats in a push for new tax cuts after the next general election. The party will be given a series of options to consider from a package drawn up by party experts.
These options will include the abolition of stamp duty, a major reduction in rates, or, most interestingly, changes to allow householders pay the duty over the lifetime of a mortgage rather than in one lump sum, as currently happens.
Stamp duty on homes is increasingly important to the Exchequer: it has netted the Government €1.9 billion so far this year - an increase of 43 per cent on the same period last year - and is expected to raise €3 billion for 2006.
The Institute of Professional Auctioneers and Valuers recently said that the tax thresholds must be widened in the December budget to ease the pressure on homebuyers struggling with higher prices and rising interest rates.
Newly elected PD leader, Tánaiste Michael McDowell, will emphasise the need to cut tax after the PD parliamentary party's one-day meeting in Malahide today.
However, its tax options are part of the party's election manifesto, and will not be a budget-day demand, the party made clear last night.
First-time buyers pay no duty on houses valued up to €317,500; a 3 per cent rate is applied to buyers of properties valued between €317,500 and €381,000; 6 per cent on those valued up to €635,000, and 9 per cent on properties above that.
Work on the PDs' tax document has been strongly encouraged for months by Mr McDowell, who also contributed to an earlier paper presented last April to the PD annual conference in Limerick.
Then, Mr McDowell and Cork-based Senator, John Minihan, suggested the top tax rate should fall to 40 per cent. The standard rate of 20 per cent would apply to single people earning less than €50,000, or €100,000 for couples.
Meanwhile, the party's newly elected deputy leader, Dublin South TD Liz O'Donnell, has sharply criticised one of the party's leading figures, Paul Mackay, over his criticism of former leader Mary Harney, describing his contribution as "inappropriate and unhelpful".
Speaking last weekend, Mr Mackay had said Ms Harney had given three different dates for her retirement before she decided to stay on last June.
