Minister casts doubt over increase in rent tax credit ahead of budget

By Cate McCurry, PA

The Housing Minister has poured cold water over any plans to increase the rent tax credit in the upcoming budget, saying the country is living through “uncertain terms”.

James Browne said he will negotiate with Minister for Finance Paschal Donohoe but added that a lot of tough decisions will be made as part of Budget 2026.

The rent tax credit increased by €250 to €1,000 euros for private tenants earlier this year.

 

The measure was first introduced as part of Budget 2023 and has gradually increased since then.

Mr Browne said the rent tax credit was a “huge support” for renters.

“I think all of us in Government are very conscious of that. We’re conscious that rents are unfortunately continuing to increase,” he added.

“That’s why we’re making decisions we’re making now to increase the supply so we can get rents back down.

“It’s the only way we’re going to get rents down is by increasing that supply.

“But in terms of the budget, I think, as we do every year, we’ll enter in negotiations with Minister Donohoe across Government.

“A lot of tough decisions have to be made.

 

“We’re in very uncertain terms, and I leave any discussion for any tax credit to the budget.

“I think the budgetary situation is far more uncertain than it was in the past.

“But I think the commitment of this Government to renters, in terms of the different tax credits that we’ve had to date, and in terms of the rent security now we’re bringing in to change the legislation.

“Our commitment is there for renters.”

The minister also defended his plan to lower the cost of apartments by reducing their size.

The Cabinet signed off on new guidelines for apartment building brought by Mr Browne on Tuesday.

It includes a reduction in the minimum size of studio apartments from 37 square metres to 32 square metres.

 

In an attempt to improve delivery costs of apartment schemes, the Government would also remove any restrictions on apartment mix.

Mr Browne, who said his proposals will reduce costs by between €50,000 and €100,000 per unit, also confirmed he will publish the research which shows this.

He added: “We know we have to make very real decisions here.

“We were very disappointed with the number of homes that were delivered last year.

“We did expect a higher number. I went through why that happened.

“I really analysed it, and when you look at it, it’s actually a collapse in delivery of apartments in Dublin city.

“We need to get those apartments delivered, whether they’re built to rent or whether they’re built to sale as a key part of getting the homes delivered.

 

“We will publish that research. So we will make it available.

“The very fact that apartments are not being built at a scale that we need, it’s actually collapsing in terms of delivery, we see apartments being built in other cities across Europe, international finance is going elsewhere, not to here.

“There’s a massive affordability piece for people who want to rent or purchase, but for the developers, there’s a viability piece.

“They are saying that if they build them at the current cost it would take to do so, nobody would be able to purchase them, and that’s why they’re not doing so.

“We need to get them built, and that’s why we’re making these decisions. None of these decisions are easy.

“Having the highest specification of apartments that never leave the design table is of no benefit to the people living in a box room at home.”

He made the comments as he turned the sod at James McSweeney House, a development by Cabhru and Dublin City Council which will see 35 units built for older people.