Property Tax

Property taxes can protect government revenue if house prices decline, Central Bank economists say

Levies can offer a ‘source of revenue less significantly affected by the economic cycle’

Inflation-adjusted house prices in Ireland rose 6.6 per cent in May from a year earlier, marking the fourth consecutive month the pace of growth has slowed. Picture: Getty

Property taxes can be used to mitigate downside risks to house prices and channel benefits to governments, three economists at the Central Bank said.

“Recurrent property taxes may have multi-faceted advantages for policymakers,” economists led by Martin O’Brien wrote in a paper released by the bank yesterday. As well as reducing the severity of declines and volatility in the market, the “acyclically” of levies can offer “a source of revenue that is less significantly affected ...