A levy on concrete which came into force this month will add €1,200 to the price of a house and hike the cost of delivering wind power, schools and bridges, manufacturers have warned.

The introduction of the Concrete Levy by the Government resulted from the need to finance a redress scheme for those homeowners affected by the issue of defective products that have been used in the building of their homes.

The Remediation of Dwellings Damaged by the use of Defective Concrete Blocks Act 2022 puts in place a statutory framework for the provision of grants to homeowners across Ireland whose homes were built using defective products such as concrete blocks that contain excessive amounts of the chemicals known as mica or pyrite. Revenues raised from the Concrete Levy will finance the provision of grants under this redress scheme.

Last October, the Government had agreed that the levy announced in the Budget would be cut to 5% rather than 10%. The levy was also originally meant to be introduced in April 2023.

Senior Policy Executive for Farm Business and Renewables with the IFA Karol Kissane said the levy would apply to all ready mix, all concrete blocks and as they recently discovered all precast concrete products. This includes ready mix concrete, thus affecting cattle slats, fence posts, culverts and precast panels.

The Minister for Finance, Michael McGrath commented, “The Defective Concrete Products Levy (DCPL) is intended to ensure a contribution by the construction sector towards the cost of the Mica Redress Scheme.

“A limited number of precast products had originally been listed as being within scope of the levy when it was announced in October 2022. Following further consideration, these were removed prior to the publication of what became Finance Act 2022. The legislation provided that while such products would not be within scope of the DCPL, the pouring concrete element which forms a constituent part of precast concrete products is within scope.

“The Department of Finance will, with Revenue’s assistance, closely monitor the introduction and operation of the DCPL and will continue to engage with industry to identify ways to address any issues that arise.”

Construction employers and contractors have been urged to ensure that future contracts are clear on the costs linked to a new levy on concrete products and to check the levy doesn’t affect current contracts adversely.

NB – This is a guide for information purposes only and does not constitute legal advice. If you have an issue requiring legal advice, please contact any of the team at Nolan Farrell & Goff LLP, whose numbers can be found on our website www.nfg.ie, or email info@nfg.ie.