The Digital Hub Development Agency (DHDA) is facing the “unintended consequence” of paying a €575,000 residential zoned land tax (RZLT) bill this year on properties at its campus in Dublin’s Liberties.
That is according to the chief executive of the DHDA, Fiach Mac Conghail, who told the Public Accounts Committee that the €575,000 RZLT bill was in addition to the DHDA being levied €1.63 million by Dublin City Council under the vacant site levy (VSL) regime for one warehouse property on Watling Street in Dublin 8 over a seven-year period.
The combined cost of the two “land-hoarding” taxes on the DDHA is €2.2 million.
In his letter to the PAC, Mr Mac Conghail said that the DHDA was last year levied €315,000 by Dublin City Council for the Watling Street warehouse property and this followed a levy of €315,000 in 2023.
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Mr Mac Conghail provided figures showing that the site has been subject to the VSL since 2018.
The vacant site levy is imposed at a rate of 7 per cent of the value of the Watling Street site, which Dublin City Council put at €4.5 million.
In 2021, the Government scheduled the DHDA for dissolution and the transfer of its lands to the Land Development Agency (LDA) to be used for the development of affordable housing. However, the agency has continued in business, and it will be 2027 before it ceases activity, the Department of Communications has said.
In his letter, Mr Mac Conghail said that the LDA is making significant progress with its Pear Tree Crossing master plan and is expected to make a planning application to Dublin City Council in the first quarter of 2026.
He said: “We are fully supportive of this LDA housing project. It is expected that the relevant lands currently owned by the DHDA will be transferred to the LDA in 2026. This will also include the Watling Street warehouse property, which is subject to VSL.”
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He said that “we are currently exploring the possibility of the remaining occupied properties being transferred to Dublin City Council”.
He added that “our parent department decided that the DHDA will remain open and operational until at least the end of 2027 to facilitate the dissolution process”.
The VSL has been replaced this year by the RZLT, which aims to activate land that is serviced and zoned for residential or mixed use to increase housing supply and ensure regeneration of vacant and idle lands in urban locations.
“The unintended consequence for us is that it will increase the tax liability on these properties until such time as they are transferred to the LDA. DHDA is subject to RZLT of €575,000 for this year,” Mr Mac Conghail said.
