Housing corporation umbrella group Aedes, building unions and tenants’ groups on Tuesday urged the upper house of parliament not to pass legislation imposing a €1.8bn extra tax on the corporations.

The senate is due to debate the plan next week, but the interest groups say the likely effect has not been properly calculated and it would be ‘irresponsible and senseless’ to go ahead, news agency ANP reports.

The extra tax on housing corporations will be based on the value of their property, and forms an essential part of the government’s strategy to cut the budget deficit.

Maintenance

But the lobby groups fear the tax will further reduce the amount of money housing corporations have to carry out maintenance and build new homes.

The government was planning to collect €2bn through the extra tax but was forced to cut this slightly in order to win enough political support to ease the measure through the upper house of parliament.

The coalition government needs the support of other parties to ensure its plans have majority backing in the senate.

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