Articles from the Sunday Independent (2/12/07)

McCreevy hits Cowen on economy


As the minister faces the budget on Wednesday, Stamp Duty receipts are down €730m on original estimates and the housing sector is in a full blown crash, but Mr Cowen is not expected to introduce any stamp duty reform.

Robert Ganly, president of the Irish Auctioneers and Valuers’ Institute (IAVI) has blasted the lack of movement by Mr Cowen in relation to stamp duty as the market collapsed this year, which has resulted in millions lost in revenue and hundreds of job losses.

He said: “Last year they took in almost €4bn in stamp duties. This year they will take a billion less, and it’s their own fault. We have a real problem now. We need to inject some life into the market, and the Tanaiste has an opportunity to do that on Wednesday.”

Describing stamp duty as a “tax on hope”, Mr Ganly called on Mr Cowen to initiate an immediate review on stamp duty and other major areas of concern relating to the property sector, get the report quickly, and then act on those recommendations as soon as he can. He said Mr Cowen has dug himself into a “rhetorical” hole that he refuses to come out of, and that it is hurting the economy.

How Cowen can get out of corner on stamp duty

Retail sales to bear brunt of economic slowdown

Furniture shops, electrical retail stores, menswear and DIY outlets will bear the full brunt of the economic slowdown next year with the growth in retail sales set to halve in 2008.

Economists expect retail sales growth to slow to between 3 and 4 per cent next year, compared to 7 per cent for the first nine months of this year.

“People are getting more cautious so spending won’t be as great as previous years,” said Alan McQuaid, chief economist at Bloxham Stockbrokers.

“Retailers may get through the Christmas season and January sales relatively unscathed. But after that, you’d be worried.”

Austin Hughes, chief economist with IIB Bank said the oversupply of retail outlets will put more pressure on retailers to slash their prices.

“It will be a buyer’s market,” said Hughes. “Retailers reliant on a buoyant housing market will suffer. So too will electronic products and big ticket items like cars.”

This despicable piece of PR on behalf of the IAVI ran on the front page of the Indo today. The quotes from Ganly beggar belief. I can only hope that people are not gullible enough to be convinced by the IAVI’s new-found role as saviour of the people. Apparently the problem was never extortionate prices or greed on the part of auctioneers/developers/sellers. It turns out that global economic instabilities are irrelevant to Ireland. If Cowen had simply abolished this cruel “tax on hope”, the property bubble would have continued indefinitely and we would all be thriving, right?

Where were the IAVI when EA’s were lying to buyers?

Indeed where are there?

-Rd

Eh…were FTB’s not the most important part of the market a short while ago!!! Now been relegated.

:bulb: Or we could let property prices drop by 40%, people would pay the same amount in stamp duty as he demands and have less of a morgage to pay.

Nowhere near been in the same bracket. Slashing CGT at the time mainly affected the very well off, otherwise why would they be “happy to contribute a fair amount in CGT”. And a cut in income tax had nothing to do with more people going back to work. I do believe it had something to do with…now correct me if I’m wrong…possibly more jobs becoming available.

How about…

Aha, so Sean Dunne is jumping on the stamp duty reform bandwagon now.
Bit late in the day Sean.

In fairness to him, he has been ranting about this for the last 18 months. Of course that doesn’t validate his point.

Damn right Robert, and now it’s the buyers turn to do the “ripping off”. :stuck_out_tongue:

The Irish Times printed a practically identical PR piece by Mr. Ganly in October.

It amazes me that he has the gall to talk about people being “ripped-off” as if he is somehow acting in the best interests of down-trodden buyers. Perhaps if his hypothetical property didn’t cost €800k, the young couple in question wouldn’t have to pay such a large sum in stamp duty.

We’ll find out how many “hyenas” are around long before this property bust is over.

It doesn’t seem to be in the online version but Alan Aherne from NUI Galway has a short piece in the business section, putting forward a solution to the hundreds of thousands of unoccupied houses.

Sighting the example of what was done after the crash in Texas, he suggests that the Government bulldoze the lot!

That should keep plant operators in Roscommon and Longford busy for the next few years at least!

Perhaps someone has a scan?

Alan must be reading the Pin cos that is the nuts and bolts of Sidewinder’s “final Solution” unveiled many many months ago 8)

lol

I think he may have come across the idea some years previously! Like when he studied all known housing bursts as part of his job for the Fed!!!

Might make more sense to dismantle these tens of thousands of houses, built where demand doesn’t exist, then rebuild them where we have demand. Timber frame buildings especially could be ‘deconstructed’ fairly easily.

What proportion of those empty houses are timber frame built?
The timber frame suppliers won’t like the sound of that dismantling idea :wink:

**Picky G wrote
**

Uncle Sidey might have something to say about that :wink:

What a drivel-laden article - name dropping in the title (not that McCreevy should even qualify as name dropping :slight_smile:), followed by making the Irish Association of Vested Interests stamp duty argument which is completely seperate from the McCreevy criticism over the public sector bloat.

McCreevy increased public spending by 45pc over 2001/02. What was on then? Oh yes - an election! Pot meet kettle. :slight_smile: