It should not come as a surprise that as this Government enters its final lap, tensions are emerging between its constituent parts. That certainly seems to be the root cause of the dispute that has flared up between Fianna Fáil and the Green Party over the residential zoned land tax. Reports this week that Minister for Finance Jack Chambers plans to defer the introduction of the tax from its planned start date of February 2025 elicited a swift reaction from Green TDs, including Minister of State Ossian Smyth, who said a deferral would not be accepted.
Chambers and his Fianna Fáil colleagues are concerned that the legislation could unfairly penalise some farmers who are actively using zoned land for agricultural purposes. The Green position is that an accommodation can be made for such cases during the passage of the Finance Bill. But the expectation is that the Government will seek to fast-track a stripped-down Bill in the weeks after the Budget in order to call an election before the end of October. That would render any finessing of the tax difficult.
On the merits of the dispute itself, the Greens have a strong case. This Government has been generous with the carrots it has provided to the house-building sector through a multitude of schemes and subsidies that have helped to drive up prices and deliver greater profits for developers. It has been slower to employ even a modest stick like the new tax, which is designed to disincentivise hoarding of serviced land.
But as the countdown clock to the general election ticks ever louder, the scope for compromise will narrow as the respective parties become more sensitive to the implications of decisions for their electoral bases. The Greens are particularly conscious of the challenge they face in minimising their seat losses in the election.
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As Fianna Fáil Minister of State Thomas Byrne has pointed out, there have been very few public disagreements between the three Government parties up to now. Perhaps he and his colleagues should brace themselves for a few more in the months ahead.