Main Irish opposition party would double vacant-site levy

DUBLIN (Reuters) – Ireland’s main opposition party Fianna Fail, leading opinion polls before an election on Feb. 8, would double the state levy on sites suitable for housing but not yet developed in an effort to increase much needed supply.

A scarcity of housing has led to rapid rises in rents and homeless levels in Ireland’s booming economy and is one of the key cost-of-living issues that could decide whether or not Prime Minister Leo Varadkar’s Fine Gael Party wins another term.

The fellow center-right Fianna Fail said on Tuesday that it would increase the vacant-site levy introduced by Fine Gael to 14% from 7%.

It also detailed a new scheme where the state would top up the savings of first-time home buyers up to the value of 10,000 euros by one-third, targeting prospective home buyers paying high rents and struggling to save deposits.

The scheme would be limited to 25,000 applicants a year and run for five years in conjunction with the current “help to buy” tax rebate for first-time buyers, which Fianna Fail would also increase to 25,000 euros from the current 20,000 euro-level.

Varadkar said on Monday that Fine Gael, which introduced the scheme in 2016, would boost the rebate to 30,000 euros if re-elected. [nL8N29P4BR]

Fianna Fail housing spokesman Darragh O’Brien said the party would also cut development levies paid by builders on condition that a project is completed within three years. He said the party would not introduce a temporary freeze on rents that it had previously considered but now believed was unconstitutional.

Sinn Fein, Ireland’s third largest party which an opinion poll on Monday put just two points behind Fine Gael and four shy of Fianna Fail, wants to freeze rents for three years and refund an average month’s rent each year during that period.

Other Sinn Fein policies such as lowering the statutory retirement age back to 65 from 66 appear to have struck a chord with voters. But both Fine Gael and Fianna Fail refuse to govern with Sinn Fein, the former political wing of the Irish Republican Army (IRA).

Opinion polls suggest that one of the two largest parties will lead another minority government after the election.

(Reporting by Padraic Halpin; Editing by Gareth Jones)