VAT reduction to be discussed

Cork city councillors and officials are set to discuss the possibility of reducing or exempting the VAT rate for developers.

It comes after a motion by the Lord Mayor of Cork Cllr Mick Finn asking that the city council call on the Government to designate strategic areas, like the Docklands, as VAT exempt, or reduced to five per cent to make it attractive for developers to build and in parallel to increase the proportion of social and affordable units per development.

He said he felt that this would instigate new housing and apartment builds, including social, affordable and private.

His motion was discussed at a meeting of City Council on Monday with some councillors utterly disagreeing with it.

Meanwhile other councillors asked that the motion go to the planning and economic development committee for discussion.

Lord Mayor Cllr Finn said he was happy for it to go there.

“The big problem is supply and we need to make it cheaper for people to build houses which make it ultimately cheaper to buy houses,” he said.

Solidarity Cllr Fiona Ryan said that while she believed that the Lord Mayor had the best intentions when he came up with the motion, she disagreed with it.

She said: “(I agree that) it is expensive to build a house but at this stage I think that developers and landlords have been given nothing but incentives.

The northside councillor added: “At this stage the focus must be on pressuring the State to do what is necessary which is to build public housing.”

Workers’ Party Cllr Ted Tynan disagreed with the motion and wanted the council to call for a State construction company to be set up and build tens of thousands of public houses.

Fine Gael Cllr Des Cahill said the motion needs to be clearer so as it’s understood that the VAT reduction is linked with building social and public housing.