Since my appointment as Minister for Finance there has been engagement both at Ministerial and official level regarding the Derelict Property Tax with the Minister for Housing, Local Government and Heritage. Officials in my Department are working closely with colleagues in the Department of Housing, Local Government and Heritage and Revenue on the design of a new Derelict Property Tax (DPT). The DPT was announced as part of Budget 2026, to replace the Derelict Sites Levy and will be collected by the Revenue Commissioners. The yield of the tax will accrue to the Central Fund.
The design of the new tax is currently under consideration, and it is intended to legislate for the DPT as part of the autumn Finance Bill, subject to advice received from the Attorney General. This timeline is necessary to allow local authorities to prepare and publish a preliminary register of derelict properties in 2027, with the tax coming into effect as quickly as possible thereafter. Currently, the Derelict Sites Levy is an annual levy of 7% of the site’s market value and while the level of the DPT is yet to be determined, it is envisaged that the rate of the tax will not be lower than the current figure of 7%.
A key issue is that the tax must apply in a consistent manner to all residential properties and sites that are derelict. Therefore, a lead-in time will be required for local authorities to identify all the relevant derelict properties in their areas for inclusion on a register in a consistent manner. The tax will apply in its first year to towns and cities with populations of four thousand or more. In its second year, it will be extended to towns with populations over two thousand.
Once the DPT is operational, I am confident that many owners of derelict properties will be incentivised to take action to bring these homes back into use and ultimately contribute to our housing stock. The behavioural effect of the tax will also contribute to regeneration and development, breathing new life into our villages, towns and cities.
Working to end dereliction and vacancy is a key priority in the Government's new housing plan, Delivering Homes, Building Communities.
Under the Plan, measures will be introduced such as a new Above the Shop grant and an Expert Advice Grant to support bringing vacant upper floors into use as homes. It introduces an expanded Living City Initiative and greater use of CPO powers by local authorities to tackle long term vacancy and dereliction.
These measures build on the progress that has been made to date returning vacant and derelict properties back into use. Some key areas of progress in the past year include:
• Successful delivery of the Vacant Property Refurbishment Grant, through the Croí Cónaithe Towns Fund.
• The €150 million Urban Regeneration and Development Fund which has been made available for local authorities to acquire vacant or derelict properties and sites for re-use or sale.
These and other initiatives outlined in the Vacant Homes Action Plan Progress Report are yielding significant results. Across the country, cities and towns are being revitalised and vacancy levels are declining as more and more empty properties are being brought back into use as homes.