Stamp Duty: Valuable Source of Tax Revenue or Unfair Levy that Hinders Investment?
Research Methods
MBA Research Proposal Template
Student Name Kevin McGuinness Course MBA
1. Title (research topic)
Stamp Duty: Valuable source of tax revenue or unfair levy that hinders investment?
2. Background/context
Stamp Duty provided the exchequer with €2.73bn in tax revenues in 2005 or 7% of total exchequer returns[1]
This revenue has increased dramatically in recent years due to the housing boom but since late 2006, evidence of a slowdown in property sales in prices has given a strong indication that stamp duty is likely to fall considerably in 2007 and 2008.
While Ireland would be regarded in general as a low tax economy, Stamp Duty in Ireland is higher than most EU countries, with a top rate of 9% and is payable within 30 days of purchase.
Many interest groups suggest reductions in stamp duty rates, whereas alternative options could include changing the administration of the tax.
Conflicting views exist with regard to whether a significant reduction in stamp duty rates will increase the affordability of house prices (these are discussed in the literature review). The author wishes to test whether a change in administering the tax could have the desired effect.
Specifically, the model would involve analysing a system whereby stamp duty, instead of being paid upfront, is paid over a period of time, probably in line with the length of the mortgage. This could reduce upfront costs of purchasing a house. It could be linked to the income tax relief for mortgage interest (known as TRS)
Overall Research Aim: To analyse whether a particular model for stamp duty reform is capable of making residential property prices more affordable and how effective it could be in stabilising the property market.
As a qualified tax consultant and a potential house buyer in the future, stamp duty and tax in general is a major area of interest of the author and with the strong public interest in house prices and the significant role of the construction
MBA Research Proposal Template
Student Name Kevin McGuinness Course MBA
1. Title (research topic)
Stamp Duty: Valuable source of tax revenue or unfair levy that hinders investment?
2. Background/context
Stamp Duty provided the exchequer with €2.73bn in tax revenues in 2005 or 7% of total exchequer returns[1]
This revenue has increased dramatically in recent years due to the housing boom but since late 2006, evidence of a slowdown in property sales in prices has given a strong indication that stamp duty is likely to fall considerably in 2007 and 2008.
While Ireland would be regarded in general as a low tax economy, Stamp Duty in Ireland is higher than most EU countries, with a top rate of 9% and is payable within 30 days of purchase.
Many interest groups suggest reductions in stamp duty rates, whereas alternative options could include changing the administration of the tax.
Conflicting views exist with regard to whether a significant reduction in stamp duty rates will increase the affordability of house prices (these are discussed in the literature review). The author wishes to test whether a change in administering the tax could have the desired effect.
Specifically, the model would involve analysing a system whereby stamp duty, instead of being paid upfront, is paid over a period of time, probably in line with the length of the mortgage. This could reduce upfront costs of purchasing a house. It could be linked to the income tax relief for mortgage interest (known as TRS)
Overall Research Aim: To analyse whether a particular model for stamp duty reform is capable of making residential property prices more affordable and how effective it could be in stabilising the property market.
As a qualified tax consultant and a potential house buyer in the future, stamp duty and tax in general is a major area of interest of the author and with the strong public interest in house prices and the significant role of the construction
References: 1. Comyn, A (2007) ‘Residential Property Stamp Duty Audits’ Irish Tax Review, 20:6, 84-88 2. Cooke, A (2007) ‘IAVI Delivers on Stamp Duty Reform’ [online] (cited 20 December 2007) Available from URL:http://www.iavi.ie/NewsDetail.aspx?rowid=129622 3. White, R (2006) ‘Irish Property: Government finances exposed to a correction’ [online] (cited 10 October 2006) Available from URL:http://www.davydirect.ie/other/pubarticles/irishpropertyoct2006.pdf 4. Saunders et al., 2007, Research Methods for Business Students (4th edn), Financial Times Pitman Publishing, London -----------------------