The Tax Take

The Tax Take

When it comes to pensions affordability, we may not be able to do much, however, something can be done on clarity

Not all tax incentives are popular. Much of the talk surrounding the recent budget had to do with the new help-to-buy incentive, a tax rebate of up to €20,000 to set against the borrowings for a new home. The main complaint was that this kind of tax incentive would drive up the cost of housing for prospective owners, rather than achieve its eponymous help-to-buy objective. In purely economic terms, help-to-buy does not directly address the housing supply issue so on purely economic grounds, help-to-buy is open to criticism. However, in my experience, tax measures don’t always have the consequences which classical economics might predict. A tax incentive can influence a commercial or personal decision sometimes in a manner which is disproportionate to the benefit.

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