The tax on second properties should be increased by the Government and all monies raised by it should be shared between central and local government, Chambers Ireland said today.
The organisation, which represents over 12,000 businesses across the country, said the €200 levy on second properties, introduced in the Budget in October, should be increased to generate revenue and help offset the recent collapse in tax revenues.
"This would incentivise both parties to adopt strong collection and enforcement policies while also reducing cost pressures on business by providing alternative revenue streams to local authorities," Chambers Ireland chief executive Ian Talbot said.
In last October's budget, a tax of €200 per annum was imposed on owners of holiday or second homes and investment properties, which is predicted to generate up to €80 million annually. The money is to be used to compensate local authorities for a €25 million reduction in exchequer funding in 2009.
According to estimates from the Central Statistics Office (CSO), 200,000 people own buy-to-let properties and another 200,000 have second homes, 50,000 of which are listed as holiday homes.
A new proposal to increase the levy to as much as €600 is being discussed during talks between the Government, employers and trade unions which continue today.
"Given the precipitous nature of the fiscal deterioration, the Government should make these modifications as part of a move to widen the tax base via a new, broadly based local property tax and rebalance service charges equitably across the entire community," Mr Talbot said.
