A new Derelict Property Tax has been announced in Budget 2026, aimed at tackling long-term vacancy and breathing new life into towns and cities such as Mallow and Kanturk, which have long been blighted by dereliction and disuse.
Until recently, 37 properties in the Kanturk-Mallow Municipal District were recorded as derelict on the official register.
Finance Minister Paschal Donohoe unveiled the new tax as part of a wider effort to “activate housing stock” and encourage the redevelopment of unused buildings. The measure, which will be administered by Revenue, will replace the existing Derelict Site Levy, currently charged at 7% of a site’s market value.
“I have agreed with the Housing Minister that this will replace the derelict site levy currently charged at 7% of site market value. I do not intend the new tax to be charged at a lower rate than this,” said Mr Donohoe.
The Minister also announced tax reliefs to promote the conversion of non-residential buildings, particularly “over-the-shop” spaces, into much-needed housing. These measures are designed to revitalise town centres while addressing Ireland’s ongoing housing shortage.
Almost 20,000 residential buildings were classified as derelict nationwide as of June 2025, a figure that underscores the urgency of the problem. The new tax is expected to complement existing schemes such as the Vacant Property Refurbishment Grant (Croí Cónaithe), which has already seen significant uptake across the country.
Local authorities are also advancing their Town Centre First Regeneration Plans, focusing on strategies to address vacancy, attract investment, and restore vibrancy to urban cores. Municipal meetings held in early 2025 signalled a stronger emphasis on enforcement, compulsory acquisitions, and funding to repurpose neglected properties for residential or mixed use.
With both national and local measures now aligning, the Government hopes the new Derelict Property Tax will mark a turning point, transforming empty buildings into homes and helping to reinvigorate towns and cities across the country.
