Donal Moynihan
Question:59 Mr. Moynihan asked the Minister for Finance the plans, if any, he has to expand the VAT regime; and the proposals, if any, he has to provide for additional tax allowances at the standard tax rate. [16747/96]
Written Answers. - Tax Changes.
I have no plans at present to expand the value-added tax system. VAT is governed by European law, with which Irish law must comply. Any proposals at EU level to alter the tax system must be made by the European Commission.
In relation to allowances at the standard rate of income tax, the position is that in the 1994 budget the phased standard rating of mortgage interest and medical insurance premium reliefs were introduced. Medical insurance relief is now fully standard rated since April 1996 and mortgage interest relief will be fully standard rated from April 1997. In addition, new reliefs introduced in the 1995 and 1996 budgets are being provided at the standard rate of tax. These new reliefs include reliefs for donations to Third World charities, rent relief for people under 55 years of age, third level education fees, service charges and alarms for the elderly. The question of tax allowances generally and their extension or restriction is a matter for consideration in the context of the budget.