Sign up to receive alerts from the Irish Times

Just click "Allow Notification" on the message displayed on the browser to activate them.

We will send you a quick reminder in the future in case you change your mind.

In May, homeowners affected by mica protested outside the Donegal County Council office in Letterkenny, Donegal County. Photography: Joe Dunn

As the alliance fears that the cost of any taxation will be directly passed on to consumers, the prospect of the government forcing the industry to make a significant financial contribution to mica remediation costs has faded.

Housing Minister Darragh O'Brien said a few months ago that he had asked Attorney General Paul Gallagher to review the feasibility of taxation in order to alleviate the need to rebuild and repair Donegal and repair thousands of houses to the Treasury Burden. Mayo is damaged by the minerals present in the building blocks.

Although it is said that the Minister of Finance Paschal Donohoe is also keen on "income-increasing measures" to cover some remedial costs, the government is increasingly worried that imposing fees on the construction or insurance sector will inevitably lead to consumer price increases.

"Taxpayers are already paying the bills. Why should consumers be punished?" said a senior government official involved in negotiations for a new remedy plan. "If you are talking about taxation, how will this affect the entire real estate industry?"

Although there has been political talk of taxation, Tom Pallon, director general of the Construction Industry Federation, told The Irish Times that the government has never raised the issue of charging the company he represents.

"We have an open relationship with the government on all issues. This has never been mentioned," Mr. Palon said.

Alliance leaders discussed the potential complications of taxation during negotiations on a new remediation plan last week. After several months of pressure from homeowners in Donegal to demand a "100% remediation" plan, The plan will be finalized soon.

After the meeting, a senior government official said that unless Treasury officials “return in a very clever way of taxation that does not affect consumers,” it is unlikely that industry costs will be pursued further.

The source said that in view of the increasing construction of houses and apartments to solve the problem of rising costs of new houses, the unwillingness to impose a construction tax reflects people's concerns that construction costs have already risen sharply.

Mr. O'Brien proposed the concept of insurance taxation because the family insurance company stated that mica damage is not on the insurance risk list and therefore not covered by insurance.

However, the government is now worried that insurance companies will simply add a levy to the cost of the insurance policy, which runs counter to the difficult effort to cut insurance costs. There are also concerns that taxation will weaken any prospects for promoting competition in the Irish market.

The government expects that banks will suspend repayment of their mortgages during the reconstruction or repair of mica houses, but the leaders of the coalition did not discuss the idea of ​​levying "extra fees" by taxing banks at a meeting last week. This is consistent with the assessment of banking industry veterans, who have long stated that the industry’s “contribution” will be limited to the suspension of loan repayments.

The center of the mica incident was a house whose walls collapsed due to damaged blocks. A government-appointed team of experts attributed the damage to the excessive “hazardous substances” in the aggregate used in the stones, namely muscovite. Mica is a mineral that can absorb and store water, which can cause blocks to crack and break like sand.

A report by the government working group found that if all homeowners’ requirements are met, the overall fiscal remediation cost is currently estimated at 1.4 billion euros and may increase to 3.2 billion euros.

As the government finalizes terms for a new remediation plan for up to 6,600 homeowners (mainly Donegal and Mayo), this legend will culminate in the coming weeks. There are signs that some development projects in Sligo, Limerick, Clare, Tipperary and Dublin may require similar assistance.

Keep up to date with our daily newsletter every morning, lunchtime and evening

Irish Times products and services

Sorry, USERNAME, we were unable to process your last payment. Please update your payment details to continue to enjoy your subscription to The Irish Times.