Vol. 548 No. 2
214 Mr. J. Mitchell asked the Minister for Finance if, in view of the low interest rates that obtain, he will amend the provisions in relation to home loans given by employers to employees and the treatment thereof under benefit-in-kind; and if he will make a statement on the matter. [4642/02]
As the Deputy will be aware, an employee in receipt of a preferential loan is charged income tax on the difference between the interest actually paid and the amount which would have been payable at the "specified" rate of interest for home loans. It has been the practice to review these specified rates before each budget to reflect the interest rates generally available in the marketplace at that time. The specified rates are usually adjusted in 0.5% increments. Having regard to the prevailing interest rates at the end of last year, I announced in budget 2002 that the specified rate for home loans would be reduced from 6% to 5%. The relevant provision has been included in Finance Bill 2002.
