Dáil Éireann debate -
Tuesday, 23 Oct 2001

Vol. 542 No. 5

Written Answers. - Tax Reliefs.

Róisín Shortall

Question:

273 Ms Shortall asked the Minister for Finance if he will report on recent changes to tax relief on moneys covenanted to schools by parents; the reason the minimum amount allowable has been raised; if he has considered the implications of these changes for the funding of secondary schools; and if he will make a statement on the matter. [25324/01]

Minister for Finance (Mr. McCreevy)

Last year, I decided to look at the whole area of tax relief for donations. At that time there were 13 different reliefs for donations to various bodies with widely different qualifying conditions. Having considered the area carefully, I decided to simplify and rationalise the various tax reliefs for donations.

As you will be aware, in this year's Finance Act, I introduced a new scheme of tax relief on donations made by either individuals or corporate bodies to certain organisations. This includes charities, first and second level schools and third level institutions including universities. The minimum donation that must be made in any one year to a qualifying body is £200 (250) and this is £148 (185) for the short tax year in 2001. From 1 January 2002, the minimum donation will be 250. There is no upper limit on the amount which can be donated and the tax relief is available at an individual's marginal rate of tax.

I should point out that, in the case of covenants to second level schools, while there was no minimum amount, these donations could only be used for the teaching of the natural sciences. The new scheme has no such restriction.

As part of this simplification process, most of the existing tax reliefs for donations, including covenants for the teaching of the natural sciences in schools were allowed to lapse.

I would also make the point that during the passage of the Finance Bill this year through Dáil Éireann, I reduced the minimum contribution from £250 (315) to £200 (250). However, I will bear the Deputy's comments in mind in relation to the minimum donation during the preparations for this year's budget and Finance Bill.