Wealth Tax Act, 1975

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Net market value of productive property.

10.—(1) (a) Subject to subsections (2) and (3), the net market value of property to which this subsection applies shall be ascertained—

(i) by deducting from the market value of the property an amount equal to 50 per cent. of the market value of the property or a sum of £100,000 whichever is the lesser, and

(ii) by deducting from the balance then remaining a proportion of any debts and incumbrances outstanding on the relevant valuation date which were incurred in connection with that property and the business carried on in connection therewith, or were incurred in the acquisition of that property, and which, in ascertaining the net market value of property under section 11 (1), are deductible from the market value of the property, being the proportion which the said balance bears to the market value of the property.

(b) This subsection applies to—

(i) agricultural property and farm machinery which are comprised in the taxable wealth of an individual who is a farmer,

(ii) fishing boats which are comprised in the taxable wealth of an individual, or

(iii) hotel premises which are comprised in the taxable wealth of an individual.

(2) (a) Where, in the case of agricultural property to which subsection (1) applies and which is situated within one mile of an urban area, it is shown to the satisfaction of the Commissioners that the market value of that property is enhanced by its high potential for development, the market value thereof, for the purpose of that subsection, shall be ascertained by adding 25 per cent. to the agricultural value of that property on that date.

(b) For the purposes of this subsection—

(i) agricultural property shall be deemed to have a high potential for development if it is shown to the satisfaction of the Commissioners that it will probably be used for the purpose of providing sites for houses or factories within five years of the relevant valuation date;

(ii) the agricultural value of any agricultural property shall be taken to be the market value which it would have if the property were subject to a perpetual covenant prohibiting its use otherwise than as agricultural property.

(c) In this subsection “urban area” means an area which is either a county or other borough, an urban district, a town or a village.

(3) The net market value of property in the State which is used directly in the provision of employment in the State (other than property to which subsection (1) applies) and of property consisting of stock or shares of a trading company comprised in the taxable wealth of an assessable person shall be ascertained—

(a) by deducting from the market value of such property an amount equal to 20 per cent. of the market value of such property, and

(b) by deducting from the balance then remaining an amount equal to 80 per cent. of the debts and incumbrances outstanding on the relevant valuation date which were incurred in connection with the property and the business, if any, carried on in connection therewith or incurred in the acquisition of such property and which, in ascertaining the net market value of property under section 11 (1), are deductible from the market value of the property:

Provided that this subsection shall apply to property to which subsection (1) applies which is comprised in the taxable wealth of an individual in any case where the net market value thereof, if ascertained in accordance with this subsection, would be less than the net market value as ascertained in accordance with that subsection:

Provided also that, in the case of property consisting of stock or shares in a trading company whose assets on the relevant valuation date consist wholly or mainly of premises registered in the register of hotels, kept by Bord Fáilte under section 24 of the Tourist Traffic Act, 1939 , and the assets of the business carried on therein, this subsection shall, in respect of the valuation date falling in the year 1975 and the two valuation dates next following that valuation date, have effect as if “30 per cent.” were substituted for “20 per cent.” in paragraph (a), and “70 per cent.” were substituted for “80 per cent.” in paragraph (b).

(4) In this section—

“agricultural property” means agricultural land, pasture and woodland situate in the State and also includes such farm buildings, farm houses and mansion houses (together with the lands occupied therewith) as are of a character appropriate to the property but does not include property in respect of which, by virtue of section 7 (1) (a), tax is not payable;

“farmer” means an individual who is domiciled and ordinarily resident in the State and as respects whose taxable wealth not less than 75 per cent. of the market value of the property comprised therein at the valuation date consists of agricultural property, farm machinery, livestock and bloodstock thereon, and, for the purposes of this definition—

(a) livestock and bloodstock shall be treated as taxable wealth notwithstanding section 7, and

(b) no deduction shall be made from the market value of property for any debts or incumbrances;

“fishing boat” means a vessel of whatever size and in whatever way propelled which is employed wholly in commercial sea fishing;

“hotel premises” means so much of premises, registered in the register of hotels kept by Bord Fáilte under section 24 of the Tourist Traffic Act, 1939 , as consists of bedroom accommodation;

“trading company” means a company which is incorporated under the laws of the State, or a company which maintains a register of members in the State, and which is not a private non-trading company.