Tax credit for renters criticised as ‘inadequate and flawed’ by Sinn Fein

Sinn Fein has criticised the Government’s new tax credit for renters as “inadequate and flawed”.

The 500 euro payment was announced as part of Budget 2023 on Tuesday.

Sinn Fein leader Mary Lou McDonald said the tax credit is not enough as people are paying high rents while the measure also excludes students and low-income workers.

She also claimed the measure will only work if there is a ban on rent increases.

“After leaving renters high and dry for years, yesterday the Government showed up with a 500 euro annual tax credit,” Ms McDonald said in the Dail.

“That is it. It is completely ignoring the other part of the solution – a ban on rent increases.”

Taoiseach Micheal Martin defended the measure, saying people will be able to claim tax credit back on rent paid this year.

“It will be 500 euro for next year, 2023, and on an ongoing basis. The Sinn Fein budget just suggested 1,500,” he added.

“However, based on 400,000 renters, that proposal would have an estimated cost of 600 million.

“There is a massive hole in Sinn Fein’s provision. There is a 300 million black hole in its housing plan. Its figures do not add up.”

Ms McDonald claimed the tax credit will not make a “dent” for people paying high rents in Dublin and other cities.

“A 500 euro tax credit is better than nothing. I have no doubt that those tenants who can avail of it will take what they can get as they struggle to pay their rent,” she added.

“However, let us be very clear this will not make a dent for people paying average rents of over 2,000 euro per month or 24,000 euro a year in Dublin, or those paying nearly 1,500 euro a month or 18,000 euro per annum across the State.

“Crucially, the tax credit is non-refundable, meaning that those without a taxable income are left out. Who are they? The Government has left out students and low-income workers.”

Ms McDonald reiterated her party’s call for a three-year ban on rent increases, saying that without it, the rent credit will be “wiped out” by further hikes.

“The truth is that despite the Government’s posturing, it has left the door wide open for more rent hikes, more exploitation and more hardship,” Ms McDonald added.

“Will the Government give renters a real break by putting a month’s rent back into their pockets through a refundable tax credit?”

Mr Martin pointed to comments by the Irish Fiscal Advisory Council, which described budget 2023 as sensible.

“It said the Government had managed to direct resources to those who need them most and more money is being targeted towards those people,” Mr Martin added.

Labour leader Ivana Bacik said that the renter’s tax credit “at best” will pay for one week’s rent for an average person renting in her constituency of Dublin Bay South.