Written Answers Nos. 217-237
217. Deputy Seán Kenny asked the Minister for Finance the tax reliefs and breaks that remain open; the savings to the Exchequer if each tax relief and breaks were discounted; the number and savings to the Exchequer of the reliefs and breaks that were discounted in the past two years; and if he will make a statement on the matter. [47549/12]
View answerAs regards tax reliefs currently available, a comprehensive summary of these was provided recently in my reply to PQ 197 of 23rd October. As the Deputy will be aware, virtually all of the area-based and property tax incentive schemes have ended and this year’s Finance Act provided for a cap on property-based Accelerated Schemes (in line with the tax life of the particular scheme) to be introduced from 1 January 2015. Many reliefs were terminated at a date prior to period to which the Deputy refers, although in some cases transitional arrangements apply. However the reliefs that were terminated in the last two years are set out below along with the estimated annual Exchequer saving:
|
Relief |
Amount |
|
Rent relief (phased abolition) |
€97 million |
|
Patent royalty exemption |
€50 million |
|
Loans to acquire an interest in certain companies (phased abolition) |
€49 million |
|
Consanguinity relief for residential property |
- |
|
First time buyer’s relief |
- |
|
Low value properties (residential property below |
- |
|
€127k and non-residential property below €10k) |
- |
|
Purchase of new houses |
- |
|
Site to child relief |
- |
|
Estimate (combined) |
€39 million |
|
Trade Union Subscriptions |
€26 million |
|
Exemption that applies to the first 6 weeks of |
- |
|
Illness Benefit and Occupational Injury |
€13 million |
|
BIK exemption for employer provided childcare |
€6 million |
|
BIK (Benefit-in-kind) exemption on certain |
- |
|
Professional subscriptions |
€5 million |
|
Farm consolidation relief |
€1 million |
|
Approved Share Options Schemes |
€0.5 million |
|
Purchase of new shares by an employee |
€0.3 million |
218. Deputy Terence Flanagan asked the Minister for Finance if he will deal with a matter (details supplied) regarding bankers pay; and if he will make a statement on the matter. [47612/12]
View answerA review of remuneration practices and frameworks at the State supported banks – a Programme for Government commitment - is presently underway. I have noted the concerns raised by the Deputy’s constituent in relation to bankers pay in that context. The present cap on remuneration remains in place. In relation to the suggestion of a tax on bonuses I would point out that existing legislation allows for a special Universal Social Charge rate of 45% - in addition to income tax and PRSI statutory deductions - to be applied to the payment of bonuses exceeding €20,000 to an employee of a State supported covered institution. The payment of bonuses at these institutions is presently prohibited.
219. Deputy Michael Healy-Rae asked the Minister for Finance his views on correspondence regarding the cider industry (details supplied); and if he will make a statement on the matter. [47686/12]
View answerUnder EU law (Art 13(2) of Council Directive 92/83/EEC) we are obliged to apply the same rate of excise duty to all other fermented beverages, which include cider. Ireland has however used the option under paragraph (3) of that article, to apply two lower rates to cider below 8.5% vol and 6% vol. In addition, a further reduced rate of tax for low strength cider was introduced, with effect from 15 October 2008, for cider of a strength not exceeding 2.8% alcohol by volume, as provided for Under Article 5 of the Directive. The Deputy refers to the UK in his question, the UK exemption is a historical one which was in operation prior to the implementation of the Directive in 1992. Under the current EU legislative framework, a reduced rate can only be applied on the basis of strength, and there is no provision for exemption based on size of operation. The Deputy should note that a cider manufacturer's licence is also required for the production of cider on a commercial basis under the Finance (1909-1910) Act 1910.
220. Deputy Bernard J. Durkan asked the Minister for Finance if a tax refund is due in the case of a person (details supplied) in County Kildare; and if he will make a statement on the matter. [47757/12]
View answerI have been advised by the Revenue Commissioners that a refund is due to the person concerned for the tax year 2011. PAYE Balancing statement (P21) and refund will issue shortly.
222. Deputy Robert Dowds asked the Minister for Finance if he will put in place measures to enable couples where each partner owns a residence and both are in negative equity to allow them both to sell in order to buy a joint residence. [47825/12]
View answerThe Central Bank has advised me that they wrote to all mortgage lenders in 2010 to ascertain whether they were offering, or intended to offer, a mortgage product that would allow home owners to sell their existing home and transfer the negative equity portion of the original loan to the new loan. In order to ensure that proposals in relation to such mortgages were consistent with the Central Bank’s consumer protection and prudential policy objectives, the proposed criteria for any such facility would need to be agreed in advance between mortgage lenders and the Central Bank. In response to the Central Bank’s letter, only a small number of mortgage lenders said that they would consider offering such a facility. A trial period commenced in mid-2011 and was due to be assessed by the Central Bank and the institutions involved before the end of 2011. However the low level of activity made it difficult to conduct a meaningful review.
The Central Bank also advised me that, following the issue of the report of the Inter-Departmental Mortgage Arrears Working Group in September 2011- which included a recommendation on trade down mortgages - several lenders contacted the Central Bank with regard to offering negative equity mortgages. This included trade up, trade down and trade down where the customer was in arrears.
In light of this and of the low level of take up in 2011, the Central Bank revised some of its criteria and communicated this revision to the main lenders. While the provision of negative equity mortgages may facilitate people in moving homes and may generate transactions in the housing market, it is not expected that there will be a large take up of this product. All sales must comply with the affordability and suitability provisions set out in the Consumer Protection Code. I expect that the Central Bank will continue to assess the impact of these measurers as part of their general oversight of the banks’ activities in the mortgage market.
223. Deputy Arthur Spring asked the Minister for Finance if there are any debtors of the National Assets Management Agency in receipt of salaries from NAMA who are being pursued by said organisation for personal guarantees. [47856/12]
View answer224. Deputy Arthur Spring asked the Minister for Finance if there are any debtors of the National Assets Management Agency in receipt of salaries from NAMA who are being pursued by said organisation for recovery of assets transferred to a third party. [47857/12]
View answerI propose to take Questions Nos. 223 and 224 together.
The National Asset Management Agency (NAMA) advises that it does not pay salaries to debtors as it is not their employer. The Agency advises that, in certain cases, it permits debtors to retain part of the income from their income-producing assets to pay overheads where necessary for the preservation and enhancement of the value of property securing its loans. These costs may include an allowance for the remuneration of debtors and the staff employed by the debtor to manage the assets when the Agency decides that this offers the best and most cost effective option for the taxpayer.
The Agency advises that the decision as to whether to work with a debtor, and whether to approve the retention of overheads to include an allowance for the remuneration of a debtor, is determined on an individual case basis by its assessment of how it can best optimise debt recovery. A number of factors are taken into account in this regard, including a debtor’s level of co-operation with the Agency and, where applicable, the voluntary reversal of asset transfers and pledging of unencumbered assets.
The Agency advises that it does not permit an allowance for the remuneration of a debtor in circumstances where that debtor’s business plan is unacceptable or the debtor is not co-operating, including in circumstances where a debtor refuses to grant charges over unencumbered assets and/or to reverse asset transfers to relatives and others. As previously advised, the Agency is also currently pursuing a number of cases in the Courts to effect the reversal of asset transfers by debtors that appear to have been designed to put the assets beyond its reach.
The Agency similarly advises that, as the legal pursuit of personal guarantees generally occurs in the context of enforcement, the retention of overhead costs by a debtor does not arise. As advised to the House recently, to date the Agency has secured charges over unencumbered assets controlled by its debtors with a total value of €514 million. This amount includes arrangements with certain debtors that the transfer of assets to connected parties be reversed.
225. Deputy Brendan Griffin asked the Minister for Finance the number of litres of petrol and diesel that were sold in the State in the past five years for which the data is available; and if he will make a statement on the matter. [47882/12]
View answerI am informed by the Revenue Commissioners that the number of litres of petrol and diesel that were sold in the state in the past five years is not available. However, the number of litres of petrol and diesel where mineral oil tax was paid in the calendar years 2007 to 2011 is as follows:
|
Year |
Petrol |
Auto Diesel |
|
- |
Litres |
Litres |
|
2007 |
2,377,727,280 |
3,025,245,030 |
|
2008 |
2,310,695,880 |
2,959,932,690 |
|
2009 |
2,117,044,957 |
2,714,349,687 |
|
2010 |
1,930,179,524 |
2,559,664,467 |
|
2011 |
1,829,164,922 |
2,563,433,251 |
226. Deputy Michael McGrath asked the Minister for Finance the number of staff who have left Irish Bank Resolution Corporation Limited since January 1 2011 to join AIB and Bank of Ireland; if he will provide details of the posts which these persons vacated at IBRC and the posts they took up in AIB and Bank of Ireland. [47863/12]
View answerI have been advised that 384 staff across Ireland, UK and the US have left IBRC from 1st January 2012 to 2nd November 2012. Some of these staff would have been replaced. Any information which IBRC receives about employees who leave the Bank to join other organisations is based on individuals volunteering such information to the Bank before they leave. The Bank does not have validated information regarding the future plans of such ex-employees and is therefore not in a position to supply a detailed response to this question.
227. Deputy Michael McGrath asked the Minister for Finance the number of staff that are on a total remuneration package including pension payments, allowances and benefits of between €100,000 and €200,000, between €200,000 and €300,000, between €300,000 and €400,000, between €400,000 and €500,000; and the number with more than €500,000 at IBRC. [47864/12]
View answerI have been advised by the Bank of the following numbers in relation to total remuneration. These figures include the pension payments, allowances and benefits.
|
Total Remuneration |
Staff Nos in UK & IRL |
|
€0 - €99,000 |
774 |
|
€100,000 - €149,000 |
146 |
|
€150,000 - €199,000 |
44 |
|
€200,000 - €299,000 |
24 |
|
€300,000 - €399,000 |
12 |
|
€400,000 - €499,000 |
0 |
|
€500,000+ |
6 |
228. Deputy Michael McGrath asked the Minister for Finance the number of staff that are on a total remuneration package including pension payments, allowances and benefits between €100,000 and €200,000, between €200,000 and €300,000, between €300,000 and €400,000, between €400,000 and €500,000; and the number with more than €500,000 at the National Assets Management Agency. [47865/12]
View answerThe National Asset Management Agency has no employees. Rather, under Section 42 of the NAMA Act 2009, the National Treasury Management Agency (NTMA) assigns staff to the Agency. As of end-October 2012, some 227 staff had been assigned by the NTMA to the Agency. The Agency reimburses the NTMA the costs incurred in assigning these staff and in providing other business and support services. The legislation which established the NTMA in 1990 deliberately positioned it outside of the wider public service structures with the operational freedom to negotiate market-competitive salaries to enable it to compete with the private sector to attract and retain staff with specialist and highly marketable skills. Under this business model, there are no general pay grades and no pay scale and all staff are on individually negotiated contracts.
Other than a small number of staff reassigned from other functions within the NTMA, Agency staff are employed by the NTMA on the basis of specified purpose contracts – their employment lasts for as long as their particularly skills and experience are required. The total remuneration of NTMA staff assigned to the Agency, which is set out below in tabular format, reflects the fact that, given the nature of the Agency’s activities, this staffing complement is primarily composed of experienced professional staff with substantial private-sector experience. The total remuneration delineated below includes gross salary, employer pension contribution and, where applicable, other benefits. Agency staff members are subject to the Public Service Pension Deduction.
229. Deputy Michael McGrath asked the Minister for Finance the number of staff departures there have been from National Assets Management Agency since it was established in December 2009. [47866/12]
View answerI am informed by the National Asset Management Agency (NAMA) that in the period from its establishment in December 2009 to end-October 2012 there have been 23 staff departures.
230. Deputy Willie Penrose asked the Minister for Finance if in the context where people have a number of apartments where they are compelled to pay the home tax levy on each apartment and the household charge on each apartment, if he will consider allowing these as illegitimate deductible expenses as charges on the business, particularly when the holding of such properties are pure business with no other source of income available to the person who owns them; and if he will make a statement on the matter. [47954/12]
View answerI am assuming that the reference to the “home tax levy” is a reference to the Non Principal Private Residences (NPPR) charge payable under the Local Government (Charges) Act 2009. I am informed by the Revenue Commissioners that a person in receipt of rental income is assessed to income tax on the profit amount of the rents received (i.e. the gross rents less allowable expenses incurred in earning those rents). In computing the profit amount of the rents received, only those deductions that are specified in section 97(2) of the Taxes Consolidation Act 1997 are allowable. The main deductible expenses are:
- any rent payable by the landlord in the case of a sub-lease;
- the cost to the landlord of any goods provided or services rendered to a tenant;
- the cost of maintenance, repairs, insurance and management of the property;
- interest paid on borrowed money used to purchase, improve or repair the property (in the case of residential property, the deduction is restricted to 75% of the interest and is subject to compliance with PRTB registration requirements for all tenancies that existed in relation to the property in the relevant year); and
- payment of local authority rates in the case of rateable properties used for commercial purposes.
In addition, wear and tear allowances are available in respect of expenditure incurred on fixtures and fittings provided by a landlord for the purposes of furnishing rented residential accommodation. These allowances are granted at the rate of 12.5% per annum of the actual cost of the fixtures and fittings over a period of 8 years. I have no plans to amend the deductible expenses to include the home tax levy or the household charge.
231. Deputy Robert Troy asked the Minister for Finance if he will expedite a tax clearance application in respect of a person (details supplied) that has been waiting on their certificate for a considerable period of time and is causing them concern. [47980/12]
View answerThe Revenue Commissioners have confirmed that the application for a Tax Clearance Certificate from the person (details supplied) was received by them on 24/10/2012 and approved and the Tax Clearance Certificate issued electronically on 25/10/12. There was no delay on the part of Revenue in this matter.
232. Deputy Pearse Doherty asked the Minister for Finance if he will provide in tabular form the effective tax rates paid by companies in annual profit bands of €0 to €20,000, €20,001 to €50,000, €50,001 to €75,000, €75,001 to €100,000, €100,001 to €150,000, €150,001 to €200,000, €201,000 to €300,000, €301,000 to €500,000, €500,001 to €1,000,000, €1,000,001 - €2,000,000, €2,000,0001 - €3,000,000, €3,000,001- €5,000,000, €5,000,001- €10,000,000, €10,000,001 - €50,000,000, €50,000,001 to €100,000,000, and more than €100,000,000. [47998/12]
View answer252. Deputy Pearse Doherty asked the Minister for Finance if he has considered introducing a minimum effective tax rate for businesses in legislation; if so, the effective rate he has considered and the financial outworking of same; if he will set out in tabular form the potential revenue raising for the Exchequer could be if a minimum effective rate of 5%, 6%, 6.5%, 7%, 7.5% and 8% was legislated for. [48522/12]
View answerI propose to take Questions Nos. 232 and 252 together.
There are different ways of measuring the effective rate of corporation tax depending on the variables that are used. As there is no single internationally agreed comparative measure in place, I am not in a position to provide the information on effective tax rates sought in either of the Deputy’s questions.
In answer to previous questions, I have acknowledged that one estimate of the effective rate of corporation tax in Ireland is 11.9%. This figure came from a 2011 Paying Taxes study produced by the World Bank and PriceWaterhouseCoopers as part of an annual Doing Business report and includes a measurement of effective tax rates across 183 countries. This effective tax rate was calculated based on the tax obligations of a standardised company operating in each country of the study and using standard assumptions regarding exemptions, deductions and allowances.
Another recent study by the European Commission – Taxation Trends in the EU 2011 - also indicates that Ireland has an effective corporate tax rate which is close to, or indeed higher than, the statutory 12.5% rate (the rate identified is, in fact, higher than 12.5% perhaps because of the higher 25% tax rate that applies, generally, to non-trading profits).
The above calculations are to give the Deputy examples of the differences that exist in comparative studies on effective tax rates, depending on how the rate is calculated or who carries out the calculation. However, the fact that these effective tax rates are close to our headline rate is reflective of the strong transparency around Ireland’s 12.5% corporation tax regime. Neither I, nor my Department, have considered the possibility of introducing a minimum effective tax rate for businesses.
233. Deputy Pearse Doherty asked the Minister for Finance the tax reliefs available to companies; the individual costs to these reliefs to the Exchequer in each of the years 2007 to date in 2012. [47999/12]
View answerCompanies are chargeable to corporation tax on their profits, wherever arising, after taking account of allowable deductions and reliefs as provided for under the Taxes Consolidation Act 1997 (TCA). The TCA requires a company’s trading profits to be computed in accordance with generally accepted accounting practice subject to any adjustment required by law in computing such profits. Expenses that are incurred wholly and exclusively for the purposes of the trade are deductible in computing trading profits, while allowances are available for capital expenditure on plant and machinery, industrial buildings and certain intangible assets used in the trade, with such allowances treated as a trading expense. It is assumed that the Deputy is only asking about the main tax expenditures available under the TCA to companies operating in Ireland. These reliefs are listed as follows:
- Tax credit for expenditure on research & development - sections 766, 766A and 766B
- Relief for start-up companies - section 486C
- Exemption for profits from occupation of certain woodlands - section 232
- Relief for investment in renewable energy generation – section 486B
The following table shows the estimated corporation tax cost for the reliefs outlined above, for the tax years 2007 to 2010, the latest year available. Due to the Revenue Commissioners obligation to observe confidentiality in relation to the tax affairs of individual companies the cost for investment in renewable energy projects is not shown in the following table.
|
Tax relief Provision |
2007 |
2008 |
2009 |
2010 |
|
Research and Development tax credit |
€165.6m |
€146m |
€216.1m |
€223.7m |
|
Relief for startup companies |
Not applicable |
Not applicable |
Not applicable |
€4.6m |
|
Exemption for profits for occupation of certain woodlands |
€0.2m |
€3.2m |
€2.4m |
€0.3m |
234. Deputy Pearse Doherty asked the Minister for Finance the top ten corporation tax payers in here in the last full accounting year; the amount they paid in corporation tax collectively and individually; what those companies collective and individual profits were in the relevant year answered; if he will provide an estimate of what they received in tax reliefs collectively and individually, with a breakdown of the tax reliefs. [48000/12]
View answerI am advised by the Revenue Commissioners that for reasons of taxpayer confidentiality and the possibility that this information could be used to identify the corporations concerned, they are not in a position to provide the information on an individual basis as sought by the Deputy. The collective figures for profits and tax reliefs claimed as requested by the Deputy will be examined to see if these figures can be released on a collective basis without compromising taxpayer confidentially. However, it was not possible to complete this examination within the timeframe available.
As respects corporation tax payments, the latest information available relates to accounting periods ending in 2010 when the corporation tax paid by the top ten companies totalled €1.126 billion.
235. Deputy Thomas P. Broughan asked the Minister for Finance if he will allocate funding to purchase two additional mobile x-ray scanners for the Revenue Commissioners in 2013; and if he will make a statement on the matter. [48022/12]
View answerI am informed by the Revenue Commissioners, who are responsible for the collection of taxes and duties and for tackling the smuggling of dutiable and prohibited goods, that they regard anti-smuggling prevention as a high priority area. The use of enforcement equipment such as mobile X-ray scanners and other detection technologies is just one part of a multi-faceted strategy employed by Revenue to tackle smuggling. This strategy includes ongoing analysis of the nature and extent of smuggling activity and developing and sharing intelligence on a national, EU and international basis. It necessitates ongoing review of operational policies and optimum deployment of resources at points of importation and inland to intercept contraband product. Revenue continually monitors ongoing developments in available X-ray and other technologies and the selection and deployment of detection equipment is constantly reviewed. Revenue has made use of the European Union’s Hercule II programme to part-fund the acquisition of detection equipment and will apply for further funding, where appropriate, in the future. The actual technology selected and the operational deployment of that technology are matters for the Revenue Commissioners.
Under the present rules of the Hercule II programme, Ireland would have to fund a minimum of 50% of the capital cost and 100% of the ongoing operational costs of a new container scanner. The capital cost of such a scanner would be of the order of €3 million and the running costs would be approximately €320,000 a year.
Revenue currently has two mobile X-ray container scanning systems, which are based at Dublin Port and Rosslare Ferry Port. However, both scanners are available for deployment at other ports and at warehouses etc as required, and Revenue utilises them, on a risk assessment basis, at various locations throughout the country. Revenue is satisfied that the container ports are adequately serviced by these scanners and has no plans at present to acquire any additional scanners of this kind.
Revenue also uses smaller static baggage/parcel scanners at all major ports, airports and postal depots and are currently in the process of replacing units in Dublin Airport, Shannon Airport and Rosslare Ferry Port. In addition, it expects to take delivery shortly of a mobile x-ray van, which will enhance scanning capabilities at airports, ports and warehouses. The acquisition of this equipment is being supported by the Hercule II programme.
236. Deputy Pearse Doherty asked the Minister for Finance further to Parliamentary Question No. 141 of 23 October 2012, if a person (details supplied) has been appointed to the National Development Agency, and if he will provide a brief background on this appointee. [48093/12]
View answerI wish to clarify that it was Mr Gerry Murray who was appointed to the Board of the National Development Finance Agency (NDFA) in July 2012 and not Mr Gerry Murphy as stated in reply to Parliamentary Question No 141 of 23 October 2012. Mr Murray is the Chief Executive of Institutes of Technology Ireland (IOTI), which is the representative body for thirteen of Ireland’s Institutes of Technology. He was formerly the Head of the PPP Unit in the Department of Education and Skills and has direct experience of PPPs and project management.
237. Deputy Arthur Spring asked the Minister for Finance the average wage for developers or project facilitators in the National Assets Management Agency; and if he will make a statement on the matter. [48105/12]
View answerAs previously advised to the House (Parliamentary Question, 39693/12, 20 September 2012) and restated by the National Asset Management Agency’s Chairman before the Joint Oireachtas Committee on Finance, Public Expenditure and Reform in recent weeks, the Agency has permitted 168 principals to retain salaries from rental and other income generated by their cash producing assets where it has determined that this represents the best and most cost effective option for the preservation and enhancement of the value of property securing its loans . As further advised the Agency’s analysis shows that 17% or 29 principals retain income of up to €49,000; a further 43% or 73 principals retain income of between €50,000 and €99,000; 23% or 38 principals retain income of between €100,000 and €149,000; 15% or 25 principals retain income of between €150,000 and €190,000; and 2% or 3 principals retain income of €200,000. The Agency advises that, based on this breakdown, the total principal salaries retained from income producing assets in 2012 will be of the order of €15.5 million. The Agency advises that it takes a large number of factors into account before approving the overhead allocation for any debtor to operate its business. These include the overall value of the assets, the debtor’s level of co-operation, knowledge of the assets, experience and the Agency’s view of the extent to which he can add value.
