You will be pleased to know that I have not got any substantial second wind just because we had a break and I am going to stick to my resolution to be comparatively brief. I had moved to a couple of specific points on sections of the Bill that I was seeking clarification on and I was hoping that the Minister might refer to them in his reply. I had raised the issue of the improvement in the provision for taxation of separated couples but the lingering problem that may remain is whether a separated couple would be able to apply for separate assessment. I was about to refer to a useful article compiled by Donal Dorcey in The Irish Times of 27 May 1983. There are two passages which set out the problem very clearly:
The Finance Bill gives separated couples a choice: to be taxed as if they were still living together, or to be taxed as single people but with recognition of maintenance payments. The system of taxing seperated people as if they were no longer married is to be ended.
One ironic anomaly remains under the first option: separated couples will not be allowed to claim separate assessment for income tax. Whether one or both are working they could be taxed by single assessment — as if they were two single people — or by joint assessment as a family unit.
The writer goes on to analyse the situation where there may not be a problem and then he deals with the area where the problem may arise. It is to that passage I want to refer and invite the Minister to comment on in his reply. I quote:
If only one of the partners is employed, then that partner gets the full allowances and tax bands for a married couple. In such a case, joint assessment raises no problem for a separated couple.
Nor is there much of a problem if their taxable incomes are exactly equal, provided they are on sufficiently good terms to fill out a tax return together and to agree on a division of allowances. In nearly all cases, of course, their incomes are unequal, so that one will pay tax at a much higher rate than the other.
How to divide the allowance to yield a fair result can cause argument. The system breaks down if both have incomes and are not able to agree on a joint tax return, or do not want each other to know their financial affairs. If they could agree to that extent, they would probably not have separated in the first place.
There is one method of tax assessment which all married couples with two incomes should adopt: separate assessment. Yet this method is not even mentioned in the advertisement published by the Revenue Commissioners in all daily newspapers after last February's Budget.
A spokesman for the Commissioners assured me then that separate assessment was not being abolished. He could not explain why it was not being advertised. The explanation appears to lie in the extra work the system entails.
Each of the partners completes a separate return of income and allowances. At the end of the year a balancing statement is drawn up by the tax office combining these two returns so that the couple will wind up paying exactly the same tax as they would under joint assessment. In most cases, this means that one of them is entitled to a refund.
But PAYE offices do not issue balancing statements unless they are requested. Since 1979, they have not even been issuing tax returns forms but simply continue taxpayers' allowances from year to year.
It appears to be for the administrative convenience of tax officials that separate assessment is still being denied to separated couples under this year's Finance Bill. Consequently, most separated couples can be expected to opt for single assessment and avail of the new provisions for allowances for maintenance payments, which take up a large part of the Bill and amount to nothing in real terms.
That is the kernel of the problem. I would like the Minister to clarify whether, despite the absence of reference to it in the advertisement in February, the separated couples can avail of separate assessment.
I welcome the fact that there is recognition of the particular difficulties and discrimination which existed prior to this in the case of separated couples. It is part of a legal neglect. It is a fair comment on our law that we are more and more seeing inadvertent, but nevertheless very serious difficulties and discriminations against couples who do not fit into the totally happy mould of a married couple living together with their family. Once partners are outside the context of a married couple living together they encounter all kinds of impediments and barriers in our legal and taxation systems. I welcome a step in the right direction and would like to have the position fully clarified by the Minister.
Another point I wish to refer to is in the section dealing with an issue which has received a great deal of publicity — the residential property tax. This proposal has generated the kind of outcry, parsing and analysis which is generally reserved for measures which are going to achieve a certain amount of effective balancing within our tax system. In other words this measure is going to succeed in taxing those who, both by reference to their income and family home, are, in Irish terms, in a substantially better position to pay that additional taxation. They are people who are very articulate and have access to the media and probably include a fair helping of journalists who will find themselves met with the liability to pay residential property tax. In my view, as a member of the Labour Party, it is a modest step in the right direction. It is, if one looks at it selectively and on its own, anomalous but if it is, as I believe it is, a constructive effort to bring more equity and fairness into the system, then it is a perfectly reasonable and acceptable measure. The reaction to it is only a comment on the overall inequity of access to the media in our society because those at the lower end of the scale who are suffering from far greater discriminations and deprivations simply do not have the airing of their problems. Poverty is not a matter that gets aired in the property columns of the newspapers and discussed at great length in editorials.
I support this measure in all its modesty and I would like to see a more comprehensive structure of equity in our tax system. I ask the Minister for specific clarification of an aspect of it which is of concern to me because I have learned through my spouse of the particular difficulties that a measure of this kind can pose for heritage properties in Ireland, for particular properties which, by reason of their historic, architectural, aesthetic value, are of particular concern to all of us. The heritage properties I talk about are on public access and are part of the rich heritage of all Irish citizens. There is in fact a provision in section 95 which is specifically geared to ensuring that the difficulties and needs of heritage properties are taken into account. Section 95 defines residential property but does not include an approved building within the meaning of section 19 of the Finance Act, 1982. This is a reference to a property which satisfies standards in relation to its importance from an historical, architectural and aesthetic point of view, which has been properly approved through the Office of Public Works and by the Revenue Commissioners, and is an approved building for those purposes. I understand from my own inquiry in the Office of Public Works that so far there are no approved buildings under section 19 of the 1982 Act, that the system, like all these systems, works rather slowly and although there have been some inquiries and forms filled, as yet there is no approved building as such, although it is my understanding a number of properties are anxious to achieve the status of being approved. Therefore, the question that I have to ask the Minister is whether the word "approved" is flexible enough to include buildings which will be approved in the course of this year and therefore which would be excluded, as is the intention, from the provisions of this Act. If, for example, they were approved in the latter part of this year, would they then be liable, as other occupants of properties which fall within this section would be liable as of next October, to pay the amount of tax for the year 1983? If not, is it possible at this stage to make a provision that if a property is either approved or is in the process of being approved, or would be approved before such date, say, April 1984, there would not be the liability for this particular residential property tax? The clear intention of the exclusion is to recognise the acute problems being encountered by the large publicly accessible heritage properties in Ireland. There is no doubt that we have to be very concerned about the number of properties that have been sold or lost to the Irish nation, even in the period of four or five years, and it is a matter of acute concern that a measure of this kind does not aggravate that situation, that the exemption granted will take effect from day one, and will achieve the purpose which the Minister sought by having that exemption in the Bill.
There is a further matter to which I would draw the Minister's attention in relation to section 19 of the 1982 Finance Act, that is, the fact that heritage gardens as such have not been included in the category of property which can potentially become approved for the purposes of section 19 of the Finance Act, 1982. There are heritage gardens, for example Powerscourt, where the building is no longer a building accessible to the public. It is only a skeleton of a building now, yet the gardens are an immense resource for our citizens and for visitors and they are very frequently visited. There are other very fine gardens which are not necessarily part of any substantial architectural property as such. The studies that have been carried out in this country and the work of bodies like the Irish Heritage Properties Group and the Heritage Trust have shown that it is through fiscal measures of this kind that we can, and must, preserve and conserve our architectural and historical heritage. It is utterly vital that we do that and the benefit of so doing is to ensure that there is full access for citizens, educational groups and people who want to learn more about the skills of Irish craftsmen or Irish horticulturists, or the way in which the particular structures were erected. I would be grateful if the Minister could clarify that point.
My final comment on the Finance Bill is on the more general area. It is a specific urging that the kind of measures we have seen — this one and a measure which we will deal with shortly in relation to the charges for local government services — should be seen, communicated and discussed in the context of an action programme for the disbursement of the revenues collected. The worst aspect of the present discontent about the high level of taxation is a feeling that it is not geared to a sufficiently radical plan of action to redress the very serious problems which face us as a nation, and in particular and specifically, the problem of recognising the irreversible trends in employment and of devising a structural scheme which would ensure, apart from the level of commercial and industrial jobs which may become available, that we provide a constructive and worth-while future for our growing young population and that that involvement is recognised as dignified, is given status, security and binds the young population in their allegiance, loyalty and commitment to this State.
The necessity for a strong and radical plan of action to cope with our present economic difficulties is of the utmost urgency because at the moment what we are seeing is a very negative disintegration of our social cohesion and an oppressive leaning on the national psyche. We do not respond well to being done down and to being burdened. As a nation we respond to inspiration, to vision, to challenge and to a hope that the tough measures being taken are leading on in a planned, coherent and concrete way to a better future for ourselves and for our children.