Tax bill fears driving land de-zoning requests

CONCERN over potential tax bills is driving an increase in requests to have land de-zoned which could have a detrimental effect on housing in Clare, a meeting has heard.
The January meeting of Clare County Council heard “serious controversy” will erupt when landowners start receiving bills from Revenue for unused zoned land.
The residential zoned land tax is an annual tax, calculated at 3% of the market value of land within its scope.
From 2024 it will be charged each year on land that is zoned for residential use and has access to necessary services such as water supply, roads and lighting.
The tax is aimed at activating land zoned for residential housing development.
In a motion to the meeting, councillor  PJ Ryan (Ind) asked that the council “request the Minister for Finance put in place a derogation for a fixed period on the tax being placed on residential zoned land”.
Cllr Ryan said this is because there is a “very high number of people requesting de-zoning and this is going to have a detrimental effect on the provision of housing in the county”.
Speaking at the meeting, Cllr Ryan said, “A tax has been put on zoned land that has not been used. There are people who are not aware of the position with zoned land and they are requesting their land to be de-zoned. I think we going to end up in a situation where there is very little zoned residential land in certain areas, which is going to create a problem for housing in County Clare”.
The call for a derogation was backed by Cllr Pat O’Gorman (FF), who said, “I’ve had a lot of people who have had land zoned, on to me, asking the question about tax on their land. A lot of these would be small farmers who have land near towns and villages”.
He continued, “When we were putting the development plan together, we put in the bare minimum of zoned land…….If this land is de-zoned for reasons of taxation, then towns and villages may not have enough land in the lifetime of the development plan going forward”.
Cllr Shane Talty (FF) said, “I think this is going to blow up into a serious controversy when these revenue letters arrive”.
The council is currently preparing its draft county development plan for 2023-2030.
Cllr Joe Cooney (FG) said there is confusion over how the tax will apply at this stage of the development plan process.
“It is totally confusing for the planning team and it’s confusing for the landowners that own zoned land. We don’t really know where we are going. We still don’t know what plan is going to be used. We’re all well aware that our present county development plan will no longer be in place in 2024 when they intend introducing this land tax. It is confusing for us all not only the landowners”, Cllr Cooney said,
Michael Begley (Ind) said at derogation would be “particularly relevant” to Clare because of the “overlap of the two county development plans”.
Cllr Gerry Flynn (Ind) told the meeting a distinction had to be drawn between serviced and unserviced land.
“Residential zoned land suitable for residential development is certainly required. I would say the refusal by Irish Water to invest in services needs to be questioned. And I would also say to people who want their land de-zoned, I think they should be accommodated. Unless the land is in an area of strategic importance, served by public infrastructure and the land is suitable for development”, he said.
In the end, councillors agreed to a suggestion from Pat Dowling, CEO of Clare County Council, to defer a decision on the derogation request until the completion of the development plan process.
Mr Dowling said, “We have in excess of 60 submissions at this stage. Maybe the prudent approach would be, while ye may to wish to adopt this motion this evening but defer it until we debate it fully at our workshops for the county development plan”.