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Foreign property investment funds are only paying pitiful tax to the Exchequer here, Sinn Fein says.

The REITs cuckoo funds have been slammed by Sinn Féin finance spokesman, Pearse Doherty, after he learnt that only €12.8million was collected on their hundreds of millions in profits last year.

REITs have been criticised by the opposition parties for distorting the property market by buying up vast swathes of housing from under the noses of ordinary workers trying to buy a home.

Mr Doherty said they are now further exploiting the taxpayer by only paying minimum tax on their bumper profits.

The REITs generally keep their profit numbers close to their chest, but, for example, just one of them, IRES, declared pre-tax profits of €106million last year.

IRES is one of the three main cuckoo funds operating here.

Between them, they hold billions of euros worth of affordable family homes.

There are numerous tax loopholes the foreign funds can avail of here facilitated by the Fine Gael-led government that minimised their total tax contribution to just €12.8million last year.

Mr Doherty is critical of this and is calling on the Government to tackle seriously the issue of exploitation of tax incentives by international property investors.

He said: “Last year just €12.8million was paid on taxes on dividends for REITs.

“REITs are a huge player in the Irish rental market, holding thousands of residential properties across the country.

“From these assets they glean huge amounts of rental income each year.

“But Fine Gael’s tax regime allows them to avoid corporation tax on all rental income, and tax on gains if they cash in on their assets after holding them for three years.

“In reality, REITs are only taxed when dividends from the profits of these rents are distributed to shareholders.

“That just €12.8million was paid from companies holding such vast property portfolios in this state is a damning indictment of the government’s web of tax avoidance opportunities offered to billionaire investment groups.

Mr Doherty added: “In the midst of a severe housing shortage and at a time of historically high rents, it is simply inexcusable that the government continues to offer such lucrative tax incentives to property investors who drive up prices and squeeze families out of the rental market.

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“In fact, Sinn Féin successfully forced the government to introduce a withholding tax of 20% on these dividends.

“It is clear however from this €12.8million sum that much more remains to be done.

“Fine Gael’s staggering policy failures have turned the housing crisis into a lucrative industry for international investors from which the state will see next to no tax.

“The Government has agreed to undertake a review of property related tax incentives following Sinn Féin’s proposal in last year’s Finance Bill.

“This is the opportunity to implement solutions Sinn Féin have outlined for some time – end the CGT exemption for REITs and increase the withholding tax on dividends for REITs.”