I move amendment No. 1:
In page 9, subsection (1), line 22, to delete "1991" and substitute "1998".
This amendment seeks to provide that all legislation regarding adoptions be included and should therefore include a reference to the 1998 Act.
Capital Acquisitions Tax (Consolidation) Bill 2003.
Section 1 agreed to.
SECTION 2.
The definition of "child" in section 2 includes a child adopted under the Adoption Acts 1952 to 1991. However, as an Adoption Act was enacted in 1998 it would be more appropriate to refer to the Adoption Acts 1952 to 1998. Accordingly, I accept the amendment.
Amendment agreed to.
I move amendment No. 2:
In page 14, subsection (5), line 20, to delete "in lawful wedlock" and substitute "as a child of the marriage of the adopters".
This amendment relates to the terminology used on page 14 which contains references to lawful wedlock in relation to adopters and adopted children. We should not use the terms "in and out of wedlock" and "lawful wedlock" which is a tautology as I am not aware of there being such a thing as unlawful wedlock in this day and age. We should seek to change what can be an offensive reference in certain circumstances to the child of the marriage of the adopters which gives it the same effect. This terminology is past its sell by date.
The terminology is a little dated. Section 2(5) deals with adopted children. The subsection provides that for the purposes of the Act the relationship between a child adopted in the manner referred to in paragraph (b) of the definition of child contained in section 2(1) or any other person or between other persons that would exist if such child had been born to the adopter or adopters in lawful wedlock is deemed to exist between such child and any other person or between those other persons. As a consequence the relationship of that child and any person who existed prior to that child being adopted is deemed to have ceased.
It is difficult to perceive all of that. The Attorney General's office has advised that the proposed amendment could constitute a change of meaning and, accordingly, I cannot accept it. We are restricted in terms of what we can change.
I regret the Attorney General's office has taken that approach because if the Attorney General felt he must retain the use of the word "wedlock" he could also have used the word "marriage". It brings back an era and use of language, that happily has passed, which tended to indicate legitimacy and illegitimacy depending on marriage relationships. It is offensive for the Attorney General's office not to find a more modern and less loaded form of language. If for reasons of legal certainty they feel they must retain the older form of language it should then be possible to use the term "marriage". I am not aware of the term "unlawful wedlock".
The Attorney General is constrained in what he can agree to change. The Deputy - I do not disagree with her point of view on this - will have an opportunity to change this by tabling an amendment to the Finance Bill 2003.
Is the Minister of State saying he would accept such an amendment?
I cannot say at this stage. The Attorney General is unable to change the meaning within this Bill. The Deputy will have an opportunity to raise the matter again at which time it may be accepted.
Amendment put and declared lost.
Section 2, as amended, agreed to.
Sections 3 and 4 agreed to.
SECTION 5.
Amendments Nos. 3 and 4 are cognate and will be discussed together by agreement. Is that agreed? Agreed.
I move amendment No. 3:
In page 17, subsection (7)(b), line 6, to delete “the property in which a” and substitute “a person becomes beneficially entitled in possession to a benefit, and the property in which the”.
These amendments correct drafting defects in sections 5 and 10. They came to light following publication of the Bill.
Amendment agreed to.
Section 5, as amended, agreed to.
Sections 6 to 9, inclusive, agreed to.
SECTION 10.
I move amendment No. 4:
In page 20, subsection (4)(b), line 5, to delete “the property in which a “ and substitute “a person becomes beneficially entitled in possession to a benefit, and the property in which the”.
Amendment agreed to.
Section 10, as amended, agreed to.
Sections 11 to 27, inclusive, agreed to.
SECTION 28.
I move amendment No. 5:
In page 35, subsection (3), line 24, after "discharged" to insert "after the time".
This amendment rectifies section 28(3) by inserting missing words in that subsection, which were in the original legislation on which that subsection is based.
Amendment agreed to.
Amendment No. 6 is a drafting amendment. Amendments Nos. 6, 12 and 16 will be discussed together by agreement.
I move amendment No. 6:
In page 36, subsection (5)(b), line 5, to delete “may” and substitute “can”.
These amendments correct drafting errors in sections 28, 59 and 108 of the Bill. These errors came to light after the Bill was published.
Amendment agreed to.
Section 28, as amended, agreed to.
Sections 29 to 41, inclusive, agreed to.
SECTION 42.
I move amendment No. 7:
In page 44, subsection (2)(b), line 15, to delete “section 33 of the Wills Act, 1837, or”.
The reference is to "the Wills Act, 1837, or". As this Act has been repealed why is this wording necessary?
The amendment relates to section 42 of the Bill. That section deals with benefits arising under section 98 of the Succession Act 1965. Under section 98, a benefit by will to the testator's child, or other issue, is, subject to any contrary intention in the will, preserved from lapse where the beneficiary predeceases the testator. If the beneficiary leaves issue living at the testator's death the benefit takes effect as if the beneficiary had died immediately after the testator and the property devolves under the beneficiary's will or intestacy. The section prevents a double charge to tax in such cases. The person who actually takes the benefit is taxed on a benefit taken from the testator. This amendment proposes to delete the reference to the Wills Act, 1837 from section 42(2)(b) of the Bill. As wills executed prior to the coming into effect of the Succession Act 1965 are still governed by the 1837 Act, the Attorney General’s office has advised that the proposed amendment could constitute a change in the law, which is not possible in a Consolidation Bill. Accordingly, I am not accepting this amendment.
I accept what has been advised but the Minister of State has not adequately explained why the wording is necessary if the Bill has been repealed.
My understanding is that if a father dies or predeceases his son it allows the estate to move from the grandfather to the son without a double charge.
Amendment, by leave, withdrawn.
Section 42 agreed to.
Sections 43 to 46, inclusive, agreed to.
SECTION 47.
Amendments Nos. 8 and 9 are cognate and may be discussed together by agreement.
I move amendment No. 8:
In page 55, subsection (2), line 40, after "oath" to insert "or affirmation".
The purpose of this is to ask the Minister to insert "oath" after "or affirmation". That is to take account of the considerable number of people in the country who may not wish to swear on oath but who are happy to make an affirmation. This arrangement now applies in many jurisdictions and there is no reason it should not apply here also.
I propose to deal with amendments Nos. 8 and 9 together. These amendments relate to section 47 of the Bill which deals with the signing of returns. Section 47 (2) provides that the Revenue Commissioners may require a return, or an additional return, to be made on oath. Section 47(5) refers to any oath or affidavit to be made for the purposes of the Act. As the original legislation on which section 42(2) and (5) of the Bill is based refers to an oath the Attorney General's office has advised that this amendment would broaden the scope of the legislation. Accordingly, I oppose this amendment.
There are people for whom swearing an oath is a matter of conscience and difficult for them. Laws in most countries now provide a recognition of those circumstances. Provision for an affirmation is a common practice now. I do not see why we should not move in that direction particularly given that CAT issues are complex and must often be the subject of affirmed documents. People should be given the opportunity to honour the undertaking they are giving, in regard to CAT and in regard to depositions they are making in respect of property, in a manner they respect. It is awkward for some people to be asked to swear an oath. We hear talk from the Government about respect in regard to multi-culturalism and different traditions, views and beliefs. This is a widely provided provision in other jurisdictions.
I thank Deputy Burton for her sensible comments. However, we have to follow our legal advice on this issue. The Attorney General is clearly constrained by what he has allowed here. An amendment can be proposed in the Finance Bill, 2003 and the Deputy may avail of that opportunity.
Amendment put and declared lost.
Amendment No. 9 not moved.
Section 47 agreed to.
Sections 48 to 56, inclusive, agreed to.
SECTION 57.
Amendments Nos. 10 and 11 are cognate and may be discussed together by agreement.
I move amendment No. 10:
In page 62, subsection (1), line 18, after "is" to insert "not".
These amendments correct two errors in section 57 (1) of the Bill and the amendments reflect the original legislation on which these provisions are based. These errors came to light after the Bill was published.
Amendment agreed to.
I move amendment No. 11:
In page 62, subsection (1), line 20, after "is" to insert "not".
Amendment agreed to.
Section 57, as amended, agreed to.
Section 58 agreed to.
SECTION 59.
I move amendment No. 12:
In page 63, subsection (1), line 45, to delete "may" and substitute "can".
Amendment agreed to.
Section 59, as amended, agreed to.
Sections 60 to 64, inclusive, agreed to.
SECTION 65.
Question proposed: "That section 65 stand part of the Bill."
Will the Minister explain why section 65 has been included?
What is the question?
I am seeking an explanation of the purpose of section 65.
Section 65 applies to the tax provisions of section 39 of the Finance Act 1926 whose object is to facilitate the collection of assessed tax and reduce expense by rendering unnecessary the attendance of officials and the production of documents which would otherwise be necessary.
Is that a fair provision in a case where there is a serious dispute between the parties? Is that likely to cause an injustice to the taxpayer if there is to be a full fight on the evidence? Is it absolutely necessary?
I am just checking. This came in by way of amendment of the Act 108 in 1984. We do not have the briefing in front of us. We can communicate with the Deputy on that issue.
I would be grateful if the Minister of State could do that.
Question put and agreed to.
Sections 66 and 67 agreed to.
SECTION 68.
Question proposed: "That section 68 stand part of the Bill."
I have a query on this section. I understand that if a person being assessed for tax has an estimated amount that he or she feels is due, the rule with Revenue now is to require the person to pay the estimate due. As capital acquisitions tax can sometimes happen in very sensitive family and farm circumstances, as I am sure the Minister of State is aware, if a person does not have the capacity to pay the amount he or she estimates is due, he or she loses the right of appeal and becomes liable for the full amount. I do not have a problem with the broad principle in most cases but I could envisage that there will be hardship cases. Most of the Deputies here represent rural farming areas and would probably be more familiar than I with the likely hardship cases.
We do not have a note on this. It was introduced in 1998 and was inserted into section 120(9) of the Finance Act 1998. We will include the information in our communications to the Deputy. Section 59 deals with hardship cases.
Does the Minister of State accept my point that it may prove difficult in certain circumstances to pay the estimated amount and that a person may, in effect, lose the right to——
There is a self-assessment return so it is up to the individual to make what he or she feels is an appropriate payment.
I accept that point. I am asking what happens if they are unable to pay.
I have been advised that there are hardship provisions in the CAT code which provide for the payment of tax to be delayed.
Perhaps the Minister of State will inform me of how those hardship provisions apply.
It is likely that the section was inserted to prevent spurious appeals.
I appreciate that but there are also genuine cases where property is passed on and the nature of the property may give rise to a difficulty in realising some of the tax due. In the case of some farms it may be difficult to generate the cash to pay the tax. It may mean selling the asset. I am interested to know what are the hardship provisions. I do not have a problem with the general principle Revenue is adopting, which is to be tough enough to ensure that people put up or shut up and pay but equally there can be situations where there is hardship involved.
We can communicate that to the Deputy.
Question put and agreed to.
Sections 69 to 73, inclusive, agreed to.
SECTION 74.
I move amendment No. 13:
In page 76, subsection (3)(a), line 19, after “disponer” to insert “or became subject to the disposition”.
This amendment corrects section 74(3)(a) of the Bill by inserting missing words that were in the original legislation into that paragraph. This came to light after the Bill was published.
Amendment agreed to.
Section 74, as amended, agreed to.
Sections 75 to 80, inclusive, agreed to.
SECTION 81.
I move amendment No. 14:
In page 83, subsection (4), line 22, to delete "this" and substitute "that".
This amendment corrects a typographical error which came to light after the Bill was published.
Amendment agreed to.
Section 81, as amended, agreed to.
Sections 82 to 87, inclusive, agreed to.
SECTION 88.
I move amendment No. 15:
In page 88, subsection (2)(e), lines 25 and 26, to delete “, made on or after 10 February 2000,”.
Will the Minister of State explain why it is the date made on or after 10 February 2000? The exemption from CAT applies in relation to foreign divorces, if the divorce was granted after February 2000.
This amendment relates to section 88 which deals with the exemption of certain transfers from capital acquisition tax following the dissolution of a marriage. Section 88(2)(e) refers to an order or other determination to take effect made on or after 10 February 2000, which is analogous to an order referred to in paragraph (a),(b),(c) or (d) of that subsection, that is, orders under the Family Law Act 1995 and the Family Law (Divorce) Act 1996, of a court under the law of another territory made under or in consequence of the dissolution of a marriage which is recognised as valid in this country. The relevant date is referred to in the original legislation. If the date were deleted, orders made before the relevant date would come into the scope of the exemption. The Attorney General's office has advised that this constitutes a change in the law which is not permissible in a Consolidation Bill. Accordingly, I do not propose to accept this amendment.
The position is obviously that no amendments can be accepted irrespective of whether they are deemed reasonable, on the basis that it would effect a change in the legislation. It does not mean that there are not other opportunities to present such amendments as the Minister of State has said.
That is correct. Amendments that involve a substantive amendment of the statute cannot be made here, but a substantive point can be made at the consideration of the Finance Bill when it is published.
Is it the case that all the Government amendments are effectively corrections?
Yes, or to remove ambiguities or uncertainties. Is the amendment being pressed?
No, but I would like a copy of the Minister of State's note.
Amendment, by leave, withdrawn
Section 88 agreed to.
Sections 89 to 107, inclusive, agreed to.
SECTION 108.
I move amendment No. 16:
In page 101, subsection (3), line 24, to delete "may" and substitute "can".
Amendment agreed to.
Section 108, as amended, agreed to.
Sections 109 to 113, inclusive, agreed to.
SECTION 114.
Amendments Nos. 17 and 18 in the name of Deputy Burton are out of order and cannot be moved. Deputy Burton has received a letter to this effect.
Amendments Nos. 17 and 18 not moved.
Section 114 agreed to.
Sections 115 to 120, inclusive, agreed to.
Schedules 1, 2 and 3 agreed to.
Title agreed to.
Bill reported with amendments.
I thank the Minister of State, his officials and members of the standing joint committee for their attendance.