Budget 2026: will the new Derelict Property Tax help reduce Mayo’s dereliction rate?
"And it was normal, building houses that stay empty even now," sings CMAT in her latest track EURO-COUNTRY.
The line, written about the fallout from the 2008 crash, reflects a problem that remains all too visible across Irish towns and villages - dereliction and vacancy.
In an attempt to tackle the issue, as part of Budget 2026, the Government has announced a new Derelict Property Tax, which it says will directly target dereliction in Ireland and help bring empty buildings back into use.
The measure will replace the existing Derelict Sites Levy. Under this system, each local authority maintained a Derelict Sites Register and charged an annual levy of 7pc of the site's market value.
The new Derelict Property Tax, however, will see the responsibility for collecting payments shift to Revenue, centralising the system. The Minister for Finance, Paschal Donohoe, confirmed that the new rate will not fall below the current 7pc.
The new tax won't come into effect until 2027, after legislation is published next year and a preliminary register of derelict properties is drawn up.
Since 2021, Mayo has seen its dereliction rate increase by 11.7pc. There are currently 287 sites on the derelict sites register.
The Director of Services for Housing in Mayo County Council, Tom Gilligan, has expressed cautious optimism about the new tax, stating that it could help tackle dereliction in the county by bringing a stronger national focus and consistency.
"It's certainly an interesting development, and while we await the new legislation with specific details, there are some clear potential benefits if the measure is implemented effectively,
"In relation to Mayo specifically, I do believe the new Derelict Property Tax could help tackle dereliction if it brings stronger national focus and consistency," said Mr Gilligan.
He expects reactions from property owners to be mixed, with some responding quickly to the new tax, while others may take a "wait and see" approach regarding the legislation and implementation.
This could present a challenge for councils in reducing derelict and vacant homes, as they may need to work harder to encourage owners to take action.
Although Revenue will now handle tax collection, local authorities will still play a key role in combining enforcement with community engagement and support schemes to ensure the measure has a real impact.
"The real progress will come when this 'stick' approach is matched with 'carrots' incentives like Croí Cónaithe, Repair and Leasing, and other reuse supports," Mr Gilligan explained and said that the combination of these measures is the only way to achieve lasting and positive change.
Regarding the move towards a more centralised system, Mr Gilligan said it could ensure better enforcement and visibility.
However, he stressed that: "To make a real difference locally, the process must still value local insight and engagement, something that's essential to identifying and resolving derelict sites within our communities."
Having Revenue control the tax collection will change how local authorities operate. Although moving collection and enforcement to Revenue could reduce administrative work for councils, Mr Gilligan raised concerns about this creating a disconnect if the system becomes too centralised.
"Ideally, it should be a collaborative model," he said, "where Revenue administers the tax while councils continue to lead on community engagement, property assessment and local follow-up."
While Mr Gilligan welcomed the new measure as a step in the right direction, he also emphasised that the ultimate goal is not just enforcement, but meaningful local impact.
"Overall, anything that encourages property reuse is a step in the right direction. Within our towns and villages, there is too much dereliction, and this must be turned around in order to breathe new life into our communities,
"The key will be ensuring that local authorities retain a meaningful role so that the policy remains grounded in people and place."
This article has been funded by the Local Democracy Reporting Scheme.