Developers who have built apartments they will sell this month have received almost €1 million a day in tax cuts since the Minister for Finance delivered Budget 2026, Sinn Féin has said.
The party’s finance spokesman Pearse Doherty said Paschal Donohoe told him in a parliamentary reply how the reduction in VAT to 9 per cent for the construction of apartments would cost the State €16 million this month.
“Next year it gets worse” when it will cost €250 million and then €390 million in 2027, Mr Doherty said.
He was speaking in the Dáil during debate on the Finance Bill, which puts into effect the measures announced in the budget on October 7.
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Mr Doherty rejected Mr Donohoe’s assertion that the measure was about viability.
“Thousands of apartments already under construction” will benefit, the TD said.
“There are 19,000 apartments under construction in Dublin alone” which are “already viable”.
He said: “Workers got prudent Paschal but developers, landlords and investors got deep-pockets Donohoe.”
But Mr Donohoe said: “The only reason I’m bringing forward this measure is to allow more homes to be built.”
He rejected Mr Doherty’s allegation that the measure was to support big developers.
It was “to lead to more homes being built, to try to improve the viability challenge that is most acute with regard to the delivery of apartments”, Mr Donohoe said.
He acknowledged the benefit for “apartments already being built” and said it was a consequence of how the measure was introduced.
It was not possible, however, have a “consumption-based tax” where payment was made when the purchase happened “and at the same time then say, ‘We’ll have a different tax depending on when an apartment is commenced’“.
Mr Donohoe told TDs: “You can’t do both. That would breach the principle of fiscal neutrality upon which our tax code is structured.”
He said he would also introduce an amendment to ensure it applied “to purpose-built student accommodation”.
Labour finance spokesman Ged Nash said that “with the stroke of an unsteady pen” the Government will forgo €390 million to give big builders a tax cut “and ask precisely nothing of them in return and with no social conditions whatsoever attached”.
Social Democrats housing spokesman Rory Hearne said the VAT cut would benefit “wealthy foreign funds who are the main shareholders of the big developers”.
He said the main shareholder in Glenveagh Homes was Teleios Capital, a Swiss hedge fund.
“The second-biggest owner of shares in Glenveagh Homes is Fidelity Investments, a US-based fund. The third biggest owner of shares in Glenveagh Homes is the UK-based Helikon Investments,” Mr Hearne said.
“These foreign wealth funds have benefited more from the budget than ordinary families have.”
