I announced in my Budget Statement that my Department and the Office of the Revenue Commissioners would be undertaking a detailed review of certain tax incentive schemes and tax exemptions in 2005. I subsequently announced that my Department had appointed two external consultants to review separately four area based tax incentive schemes: urban, rural and town renewal as well as the living-over-the-shop schemes and the sectoral property based schemes; multi-storey car parks; park and ride; student accommodation, third level buildings, hotels and holiday cottages. All of these are scheduled to terminate on 31 July 2006 as set out in the Finance Act 2004. The consultants are also examining the reliefs for nursing homes, private hospitals, sports injuries clinics, child care facilities and the countrywide refurbishment scheme; these five reliefs are not time limited.
I also made it clear at the time of my last budget that the tax exemptions for stallion and greyhound stud fees as well as commercially managed woodlands and the artists exemption would also be reviewed. Others which I have decided should be looked at for the 2006 budget are the reliefs for interest on loans taken out by individuals to invest in companies or partnerships, significant buildings and gardens, donations and patent income and the tonnage tax scheme and certain pension tax reliefs. None of these tax reliefs are time limited.
As the Deputy is aware, a breakdown of the costs of most of these individual schemes and reliefs is not currently available, consequently, neither is the other related information which he seeks in respect of the aforementioned reliefs.
Following are the reliefs under review for which some statistical information is available to the Revenue Commissioners:
|
Relief
|
Estimated Annual Cost, €m; (Year)
|
Number of Beneficiaries
|
Proportion going to top 10% of beneficiaries (%)*
|
Date due to terminate
|
Date of last Time Extension (if any)
|
|
Artists exemption Note 1
|
23.5 (2001)
|
1,300
|
80
|
None
|
None
|
|
Interest on loans to invest in companies or partnerships
|
11(2001)
|
7,400
|
38
|
None
|
None
|
|
Significant buildings and gardens
|
0.4(2001)
|
28
|
Not available
|
None
|
None
|
|
Donations Note 2
|
21(2003)
|
29,600
|
Not available
|
None
|
None
|
|
Tonnage tax
|
Not available
|
4 (2003)
|
Not relevant
|
None
|
None
|
*Relates to the amounts of income or deductions from income, as appropriate, on which tax relief is based.
Sufficient background information is not available to enable a meaningful response to be provided to the question on the activity level.
Figures shown for 2001 are in respect of the "short" income tax year 2001, the latest year for which the information is currently available, as published in Table IT6 on page 63 of the Revenue statistical report for 2003. It should be noted that as PAYE taxpayers were charged to tax on their earnings in the period from 6 April to 31 December 2001 and self-employed taxpayers were assessed to tax for the short year on 74% of the profits earned in a 12-month accounting period, data provided for the "short" tax year 2001 may not be directly comparable with those of earlier and later years.
Notes
1. A breakdown of the cost figure by artistic category is not available but the Deputy may wish to know that the Revenue Commissioners publish details on their website of individuals who have been granted the artists exemption. The names of those qualifying for the relief with effect from the 21 April 1998 are available and the list is set out in alphabetical order in each of the five categories of work covered by the exemption: (a) a book or other writing; (b) a play; (c) a musical composition; (d) a painting or like picture; and (e) a sculpture. The list is updated on a quarterly basis. This information can be found on the Revenue website at www.revenue.ie.
2. Relates to PAYE donors only as data in relation to donations by the self-assessed or by companies are not available; the number of beneficiaries refers to the donors rather than the "beneficiaries", which are unknown.
