“It is recommended that Section 110 provisions should not be commenced at this time. To do so, would run the risk of exacerbating the down turn in the property market” — Report to Department of Finance.

At the Committee Stage to last year's Finance Bill, Minister Cowen introduced anti-avoidance measures in relation to stamp duty on property transactions where the transactions were carried out by “resting on contract” or under a licence. The section (FA07 s1 10) was subject to a commencement order.

Prior to signing a commencement order, the Minister requested that a study be carried out on the effects of the section on the property market. Goodbody Economic Consultants carried out the study. The report, which is dated November 2007, had been placed on the Department of Finance website in February.

In summary, the report recommends that the provisions should not be commenced at this time as it could result in further downturn in the property market.

It is interesting to note that while €251m might have been saved in 2006, had such a measure been in place then; a much lower yield would have arisen in 2007 because of the downturn in the property market.

A copy of the report is available at http://www.finance.gov.ie/documents/publications/reports/2008/S110Report.pdf.