Brown envelopes set to create ‘hell’ over zoned land tax

‘HELL’ has been predicted, when people start to receive tax bills on zoned land in their ownership, under next year’s Residential Zoned Land Tax (RZLT) regime. 

The comment was made by Councillor Shane Talty on foot of a motion tabled by Councillor PJ Ryan. The Shannon member called for a derogation, for a fixed period, on the RZLT.

He voiced concern at the number of people looking for their lands to be dezoned, and the impact that that might have on the provision of housing. Supporting the motion, Councillor Talty said many people were unaware of the implications of owning zoned land.

“I think this is going to blow up into serious controversy when these Revenue letters arrive, the actual bills,” he said. 

While there was widespread support for the motion, Councillor Ryan deferred it on the advice of Council Chief Executive Pat Dowling, to give time to examine recently-received public submissions on the RZLT. 

Outlining a topic that generated much discussion at the January meeting of the local authority, Councillor PJ Ryan highlighted an increase in calls from concerned landowners over the RZLT.

“There are a lot of people jumping to get land dezoned because they’re afraid they’ll have to pay a serious amount of tax on it,” he told the meeting. “I feel that we need to do something about it, sooner rather than later.”

Seconding the motion, Councillor Pat O’Gorman said he too had received a lot of questions over the tax.

“A lot these would be small farmers and they just happen to have land bounding towns and villages,” he said.

“There is an anomaly here that we weren’t looking at originally. We all know that these farmers are not making a whole pile of money and this tax is not going to be able to be paid. In the Development Plan together, we put in the bare minimum of zoned land. If this land is de-zoned for the reason of taxation, then the towns and villages will not have enough land in the lifetime of the Development Plan.”

Councillor Talty predicted “serious controversy” when the Revenue letters arrive. “Obviously there’s a city problem, where land banks are being sat on and development has been held back,” he said.

“But what’s happening here is that it’s hitting active farmers who have no intention of developing or selling their land. A lot of people haven’t figured this out yet and there’s going to be hell when the bills start coming.”

Councillor Joe Cooney described the current situation as “totally confusing”. “We have a Land Tax draft plan out to consultation and it’s based on the present County Development Plan,” he outlined. “We have a Draft County Development Plan out and we’re going to have a new County Development Plan to come next April. When the final land tax plan is put in place, we still don’t know what plan is going to be used.”

Agreement for Councillor Cooney’s comments came from Councillors Michael Begley and Cillian Murphy. The former said far more clarity was needed, while the latter said the tax had created considerable confusion. 

Councillor Gerry Flynn said people should be facilitated in having land de-zoned “unless the land is in an area of strategic importance served by public infrastructure and in demand for suitable development”. 

Councillor Pat McMahon said people were “getting muddled up in national media, in the context of the huge builders who have hundreds of acres bought for over a long period of time”. 

Councillor Joe Killeen agreed there were “unintended consequences” arising from the RZLT. “In theory, it sounds like a great idea,” he said.

“The problem is that we’ve zoned land without ever consulting with landowners. We’ve been told that it’s not possible sometimes to identify the landowners, but Revenue won’t be long getting around that difficulty. And they won’t be long sending out the brown envelopes.” He noted the deadline for public submissions on the tax had passed and that public views should be examined.

Councillor Johnny Flynn said: “I think we need to connect the submissions on the Land Tax to the workshops in February for the draft County Development Plan.” The Ennis member also asked for clarity on the implications of owning ‘residential’ land and land zoned as ‘secondary, strategic residential reserve’. 

Councillor Ian Lynch described the issue as “extremely complicated and complex”. He called for “greater debate” particularly on the issue of lands zoned in town centres where owners had no plans to develop them.

Councillor Tom O’Callaghan said that, given the housing crisis, a solution needed to be found to the benefit to all. Party colleague Councillor Clare Colleran Molloy said a distinction needed to be made between zoned land in urban and agricultural locations. 

The Chief Executive told members that more than 60 submissions had been received by the Council on the RZLT. “Deferring the motion until we debate it fully as part of our workshop process with the County Development Plan might be the most prudent approach,” he said. 

Councillor Ryan agreed but said he would not want the motion forgotten about.

Cathaoirleach Councillor Tony O’Brien, who added his support to the motion, said: “At that rate of going, we will have a robust debate. We’ll see what submissions are at the workshops and take it from here.”