The persistent dispute between Fianna Fáil and the Green Party over the proposal to postpone the residential zoned land tax (RZLT) seems to be a typical public squabble that isn’t as severe behind closed doors. But, on closer analysis, a rising tensity is clearly evident between the two major parties and their smaller coalition ally. In the past days, the Green Party has gone beyond expressing anxieties about the tax deferral plan – they have categorically stated their non-acceptance.
While it’s true that this is a fiscal issue, it’s also the Green Party setting down a crucial benchmark before the upcoming general election, signalling a shift from compromising to confrontational tactics. This week, The Minister of State Ossian Smyth, coming onto the airwaves, expressed his astonishment at the deferral plan on a discussion with RTÉ’s Claire Byrne, adopting a tone of agitation and bewilderment.
“We are not going to delay the tax for a year. I will never give consent to that. This won’t occur,” he declared, adding that most of the land is not intended for farming…”a significant portion of this land is not agricultural.” Green Party TD Steven Matthews took it a notch forward, comparing it to hiding food amid a famine. The Greens have made their stance clear – they won’t back down. Such an adamant change in rhetoric at this political crossroads is no chance – an election is nearing, and party strategists fear a tough fight.
The Green Party is signalling a more combative stance in the next (and possibly reduced) Dáil term under their new leader, Roderic O’Gorman. For now, a political compromise on the smouldering land tax issue has to be arrived at. The exact nature of this solution remains uncertain, but a broad agreement within the Coalition is emerging that the issue should not be allowed to escalate unnecessarily.
Initially, the tax was introduced as a penalty for individuals monopolising land during a period of housing shortage. For arable lands to fall under the jurisdiction of the RZLT, they need to be both residentially zoned and facilitated. The objective is to guarantee a sufficient supply of housing on designated lands – a point which all sides concur.
Nonetheless, a problem has surfaced where numerous agriculturalists contend that their farming land will be unduly subject to this tax. A segment of these farmers argue that the tax will push them into unemployment; while others fear they’ll have to auction off their lands due to tax burdens, providing land speculators a prime opportunity to acquire the lands.
Some agriculturalists argue that the tax’s cost far outstrips the annual economic yield they can derive from their land. However, this predicament didn’t materialise out of nowhere. In the 2024 budget, a decision was taken to extend the due date of the tax by a year, from February 2024 to February 2025. This extension was designed to afford these landowners the time and chance to bring up concerns for the local government to consider, zoning issues inclusive.
Landowners had up to the end of May to apply for dezoning. A high-ranking Government source revealed: “It came to light that a significant number of active farmers were still affected, creating the present issue.” They further stated that some of these farmers who requested dezoning have encountered challenges in their endeavour. The number of farmers affected by this predicament, however, remains uncertain.
What could potentially resolve this? The introduction of revised primary laws that exclude farming land in active use might be a viable solution, coupled with a shorter tax deferral period to alleviate pressure. Defining the term “actively farmed” however, might prove to be thornier than anticipated.