Landlords are being demonised and should be given better tax treatment, the Taoiseach has said.
The National Economic and Social Council (NESC) recently advised Leo Varadkar that small landlords should be given preferential tax treatment in return for renters getting more stability, through longer leases.
Speaking in Drogehda, Co. Louth, yesterday at the sod turning for the Port Access Northern Cross Route road development, Mr Varadkar said: "I think there has been a demonisation of landlords, and small landlords in particular, in Ireland. And that hasn't been helpful.
"Lots of people need to rent for lots of different reasons. And for that reason, we need landlords."
The Fine Gael leader added: "I think it's a good idea that we should improve the tax treatment of landlords, particularly small landlords to encourage them to stay in to encourage them to come into the market. And I think what NESC proposed, which makes sense to me, is to link it to better rights for renters so that renters benefit as well."
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The NESC report said: "There may be a case for providing improved tax treatment of landlords tied to improved security of tenure for tenants."
The report noted that in 2019, the total taxable income after expenses and allowances from renting residential property was around €2bn.
The report noted that Germany provided a possible model for Ireland to follow. It said landlords in Germany were not liable for capital gains tax if they held the property for at least ten years.
In return, the sale of property is not a ground for ending a tenancy in Germany and rental properties are not sold with tenants remaining in place.
It comes as Tánaiste Micheál Martin yesterday warned that there could be a risk to supply if the winter eviction ban is extended beyond March.
Mr Martin also said that if it were to be extended, it would have to be done on a long-term basis in order to be "honest" with the market and renters.
The Government has concerns that an eviction ban implemented outside the context of an emergency could be contrary to property rights enshrined in the Constitution. Mr Martin said: "If we extend it - and I don't think you could extend it for a short term, because we need to be honest with the market - we need to be honest with those who are renting as well. What would the impact on that be on supply? Would it make it worse?
"Politically, the simple catch cry is 'extend it', 'extend the ban and then worry about the consequences later', or indeed, the consequences will be the Government's problem and the Government's fault."
Mr Martin added that "on the other hand, the eviction ban did work during the winter".
He elaborated: "Because of the crisis that was caused by the energy situation, [it] gave a very solid kind of legal basis to a winter emergency ban on evictions."
And he added: "We're giving this very serious consideration from a policy point of view. I'm mindful of some of the negatives it could have on the wider sector."
The Taoiseach said there had been a "diversity of views" expressed at the Fine Gael parliamentary party meeting about whether to extend the eviction ban. Mr Varadkar said: "It's not a black-and-white decision to extend or not to extend.
"You know, there are other things in play as well, and [Housing] Minister [Darragh] O'Brien will bring forward proposals in due course. That will be considered by Cabinet. But we will make a decision... within the next week or two so that people know where they stand on the matter.'
