There are compelling arguments for using the tax system to address urgent problems. A meaningful change in tax rates takes almost immediate effect because if the change is worthwhile, people will avail of the tax breaks if they can.
In the past, meaningful tax breaks — big income tax reliefs for rented residential accommodation, renewal of cities and towns, holiday cottage incentives and student accommodation tax deals — contributed to the property crash arguably because they ran on too long.
Some properties derived their value neither from their location nor the accommodation they offered, but from the value of the tax relief. That wasn’t sustainable and possibly explains why recent tax reliefs to address the housing crisis have been modest and ineffective.
