Sir, – Anyone who is serious about resolving the housing supply crisis should be deeply concerned by Cormac McQuinn’s report that the Government is considering ways of “easing the impact of the residential zoned land tax (RZLT) on landowners who are actively farming on fields zoned for housing” (“Ways to ease impact of residential zoned land tax on farmers set to be considered before budget”, News, July 29th).
This tax was introduced in 2022 to encourage landowners to develop housing on land that is zoned residential and serviced with the water, power and sewage infrastructure required to build housing. It achieves this by applying an annual tax of 3 per cent of the land’s market value until housing is built on it.
The application of the RZLT has already been delayed for a year by the Government following energetic lobbying by some builders and developers and farmers’ representatives. Its application should not be delayed further or watered down, particularly in the ways in which your article suggests are under consideration by Government.
Land zoning practice has been significantly tightened up in recent years and a large amount of land was “dezoned” following the housing market crash in the late 2000s. Zoning decisions are now linked to detailed local authority level assessments of housing needs and demand and associated housing supply targets. In my view these targets are often too low, therefore it is vital that every bit of land zoned to meet them is actually built on, if we are to make any progress in addressing the housing crisis.
Land zoned for residential development is generally on the outskirts of cities, towns and villages and has often been selected for zoning following very substantial investment in the infrastructure required to build houses, funded primarily by taxpayers. The Government has an obligation to these taxpayers and of course an even greater obligation to those who are in need of housing to ensure all zoned land is built on.
I do acknowledge that the tax will lead to some farmers selling land which may have been in their families for generations and to which they have a strong emotional as well as financial attachment. However, the market value of residential zoned land is many multiples of agricultural land value, therefore the sale of land at the former price should be more than sufficient to enable the purchase of replacement land at the latter price.
In any case, the Government’s proposals for dealing with farmers’ concerns are clearly open to abuse and have the potential to undermine the integrity and therefore effectiveness of the entire RZLT. It is very difficult to see what residential zoned land would not qualify for an exemption on the grounds of being “actively farmed”. Any builder or developer could ensure their land banks qualify for this exemption by leasing it out for agricultural use, for instance, or even grazing ponies on it for their children or grandchildren to use.
The Government’s willingness to proceed with implementing the residential zoned land tax and the Opposition’s willingness to support this vital tax in the face of concerted opposition by powerful vested interests will provide a clear indication to voters of how seriously they are committed to actually solving the housing crisis, as opposed to merely blunting its sharpest corners or using it to score political points. – Yours, etc,
MICHELLE NORRIS,
Professor of Social Policy,
Director of the Geary Institute for Public Policy,
University College Dublin,
Dublin 4.