Pat Breen
Question:123 Mr. P. Breen asked the Minister for Finance if he is considering changes in the test for deciding whether a person is a resident here for tax purposes; and if he will make a statement on the matter. [4722/04]
View answerTuesday, 17 February 2004
Questions (42, 43)
Written answers
I have no plans to further review the tax laws in regard to residency status. The current comprehensive system was set out in the 1994 Finance Act after detailed consideration by Government of all relevant issues.
Paul Connaughton
Question:124 Mr. Connaughton asked the Minister for Finance his plans to obtain better estimates of the cost of tax reliefs and of the impact on tax paid by those benefiting. [4699/04]
View answerAs the Deputy may know, where information in regard to individual reliefs is provided separately on tax returns form it can be captured electronically and may be examined centrally by Revenue. An example of this would be the data relating to the artists exemption where virtually all the information relating to numbers of claimants and the amounts exempted from tax can be obtained.
Aside from the tax returns forms, the cost in terms of tax foregone of other provisions, such as urban renewal or the business expansion scheme, can be estimated through the information caught by certification processes and a number of schemes such as tonnage tax are availed of by few claimants and can be gauged from a survey of returns.
However, it is important that data be improved to facilitate assessments of such expenditures and reliefs. The Department of Finance has been working closely with the Revenue Commissioners to investigate information and data capture issues arising with a view to producing possible solutions. The challenge is twofold: the first is to identify the optimal manner of obtaining the information that is required to monitor and cost existing reliefs and the second is to obtain such information with due regard to not overburdening compliant taxpayers.
Bearing this in mind the Revenue Commissioners will be introducing a number of changes to the forms relating to the annual return of income in respect of the tax year 2004 and to the P35 form, which is returned to Revenue at end year with totals for earnings and deductions for each employee, in respect of the tax year 2005. These changes will yield additional information regarding the cost of various tax reliefs and relief in regard to pensions.
I will include amendments on Committee Stage of the Finance Bill 2004 to underpin these changes. In addition, the use of the Revenue on-line system, ROS, has been increasing and will continue to be encouraged. Returns filed in this way can readily accommodate information data capture in relation to tax reliefs being claimed without overburdening the taxpayer.
In addition to keeping schemes under review, especially in the context of the annual budget and Finance Bill process, to ensure they continue to meet the purpose or purposes for which they were introduced, detailed reviews of the costs and benefits of various tax reliefs are carried out from time to time. Recent examples of this are the reviews carried out on tax reliefs for urban renewal, films and the business expansion scheme.