Government review of Investment Property tax relief

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tibbs

Guest
Surely it is not possible for the government to cap tax relief where existing property investors invested in good faith-I believe the courts could not impose retrospective tax -anyone any views on this?
 
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rainyday

Guest
Surely it is not possible for the Govt to increase taxes or PRSI where existing employees have taken jobs in good faith - same logic, isn't it?

This tax relief should be eliminated or removed as soon as possible to remove this Govt subsidy to landlords & banks.
 
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brigade

Guest
Don't see why it should be eliminated.
Bacon tried this a few years ago and it was reversed.
To go down the same road again seems stupid.
 
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rainyday

Guest
One good reason to eliminate it is the abuse of current system via interest-only mortgages, whereby a landlord will deliberately keep their interest bill high in order to get the state to subsidise it. He is better off keeping his spare cash on deposit at 2.5% approx than paying it off his mortgage (where he will save only 58% [100%-42%] of the 3% interest rate). We might as well just throw our taxes straight into the landlords and the banks instead.
 
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tibbs

Guest
From a legal view point I thought retospective tax penalties which is what this amounts to would be struck down by the Courts if it were tested -to me it would seem to me that the governmednt are estopped from changing the rules of the Contract -the principle of estoppel
 
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tibbs

Guest
What I mean is that any retrospective tax cap on the Section 23 relief would amount to misprepresentation in the sense of contract Law -any views on this ?
 
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tibbs

Guest
I essence what I mean s if you change the rules you will drive all the investors out of the property market and possibly a collapse of the property market
 
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brianbmcd

Guest
Could they change it retrospectively?

Bottom line Tibbs is that they could - but the won't, it would send all the wrong signals for future investment and would lead to a housing crisis with all investors leaving the market. The cost to the government would be enormous.

Brian
 
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