asked the Minister for Finance when appropriate arrangements will be made to repay overpayments of tax made by married self-employed taxpayers and married couples paying income tax pursuant to the PAYE system, which overpayments of income tax were made pursuant to section 21 of the Finance Act, 1980, which section was held to be unconstitutional in the case of Muckley v. The Attorney General; if interest will be paid to each taxpayer in respect of such overpayments; and the total amount due to be repaid as a result of the Muckley decision.
Ceisteanna—Questions. Oral Answers. - Income Tax Overpayments.
14.
On 12 November 1985 the Supreme Court, in the case referred to by the Deputy, declared that section 21 of the Finance Act, 1980, in that it provided for the aggregation of the earned income of married couples, was invalid having regard to the provisions of Article 41 of the Constitution.
The decision of the court raised a number of complex issues which require detailed examination by the Revenue Commissioners. Pending the outcome of that examination, which is proceeding as quickly as possible, it is regretted that the information requested by the Deputy cannot be provided.
Would the Minister agree that this provision, which was introduced in the Finance Act, 1980, when Fianna Fáil were in power required married couples to pay more tax than single people living together and has caused a great deal of inconvenience to many people? In the light of the fact that the Supreme Court decision of 1985 only confirmed that High Court decision of June 1984, would the Minister agree it is only reasonable that those people who were required to pay additional tax, for which they were not liable constitutionally, should speedily be reimbursed those sums, and that it is not reasonable at this stage for the Revenue Commissioners to have failed to work out a modus operandi resolving the problem?
There is an examination going on at present and while the examination has not yet been completed, legal advice has been obtained to the effect that repayment of tax following the court decision could be made only in certain limited circumstances. The implications of that advice are now being considered in relation to its application to specific cases. Until this task is completed, it will not be possible because of the varying circumstances surrounding the relevant cases, to make any attempt to provide the information sought by the Deputy.
The Minister is saying that the Revenue Commissioners are not in possession of information as to the amount due in payable tax. What is the nature of the advice which has been forthcoming which would indicate that overpayments made as a result of section 21 may not be repayable? Has any taxpayer who made an overpayment pursuant to section 21 of the 1980 Act been notified by the Revenue Commissioners that he may not qualify for a repayment by virtue of an overpayment?
I doubt it. As I said, the Revenue Commissioners are examining this matter and are looking at particular files to see what is the actual position of individual taxpayers. Pending the completion of that investigation I doubt if notices have issued to anyone. However, I cannot confirm that.
I note the Minister says that the matter is being examined but it is my understanding that many thousands of PAYE and self-employed taxpayers are directly affected by this. I ask the Minister to request the Revenue Commissioners to expedite consideration of these matters in the light of the fact that the Supreme Court decision of 1985 merely confirmed a High Court decision made 16 months earlier.
I will do that.
Where repayment is appropriate and where the Revenue Commissioners acknowledge that repayment is to be made, would the Minister ensure that the interest on the money due by the Revenue Commissioners will be paid at the same rate as the interest claimed on money due to the Revenue Commissioners? Would he also ensure that in the Finance Bill this year the same rate of interest will be applied by the Revenue Commissioners to what they owe and what they claim?
That would be more appropriate for discussion on the Finance Bill.
Would the Minister agree that it would be only fair and equitable ——
There will be plenty of time to disuss that later.
An Leass-Cheann Comhairle
Question No. 15.