Written Answers Nos. 153-166
153. Deputy Michael McGrath asked the Minister for Finance if he will set out, in tabular form, the revenue that would be raised from increasing the universal social charge for PAYE earners and non-PAYE earners by 1%, 2% and 3%, respectively, for earnings above €100,000; and if he will make a statement on the matter. [36637/13]
View answerI am advised by the Revenue Commissioners that the full year yield, estimated by reference to 2013 incomes, of increasing the universal social charge by either 1 percentage point, 2 percentage points or 3 percentage points for all income earners with incomes in excess of €100,000 is set out in the table.
|
Rate increase |
Full Year Yield From PAYE Income Earners earning in excess of €100,000 |
Full Year Yield From Non-PAYE Income Earners earning in excess of €100,000 |
|
1% |
€24 million |
€43 million |
|
2% |
€47 million |
€87 million |
|
3% |
€71 million |
€130 million |
The Universal Social Charge is an individualised charge and as such, the estimate of yield is based on individual incomes of more than €100,000.
The estimated yield is based on confining the extension of the new Universal Social Charge rates to the portion of income which is in excess of €100,000, that is, the increase is not applied to the portion of total income earned up to €100,000.
This estimate is derived from the Revenue tax-forecasting model using actual data for the year 2010 adjusted as necessary for income and employment trends in the interim. It is, therefore, provisional and likely to be revised.
154. Deputy Michael McGrath asked the Minister for Finance if he will set out, in tabular form, the revenue that would be raised from increasing the universal social charge for PAYE earners and non-PAYE earners by 1%, 2% and 3%, respectively, for earnings above €120,000; and if he will make a statement on the matter. [36638/13]
View answerI am advised by the Revenue Commissioners that the full year yield, estimated by reference to 2013 incomes, of increasing the universal social charge by either 1 percentage point, 2 percentage points or 3 percentage points for all income earners with incomes in excess of €120,000 is set out in the table.
|
Rate increase |
Full Year Yield From PAYE Income Earners earning in excess of €120,000 |
Full Year Yield From Non-PAYE Income Earners earning in excess of €120,000 |
|
1% |
€18 million |
€38 million |
|
2% |
€36 million |
€76 million |
|
3% |
€53 million |
€115 million |
The Universal Social Charge is an individualised charge and as such, the estimate of yield is based on individual incomes of more than €120,000.
The estimated yield is based on confining the extension of the new Universal Social Charge rates to the portion of income which is in excess of €120,000, that is, the increase is not applied to the portion of total income earned up to €120,000.
This estimate is derived from the Revenue tax-forecasting model using actual data for the year 2010 adjusted as necessary for income and employment trends in the interim. It is, therefore, provisional and likely to be revised.
155. Deputy Michael McGrath asked the Minister for Finance if he will set out, in tabular form, the revenue that would be raised from increasing the universal social charge for PAYE earners and non-PAYE earners by 1%, 2% and 3%, respectively, for earnings above €150,000; and if he will make a statement on the matter. [36639/13]
View answerI am advised by the Revenue Commissioners that the full year yield, estimated by reference to 2013 incomes, of increasing the universal social charge by either 1 percentage point, 2 percentage points or 3 percentage points for all income earners with incomes in excess of €150,000 is set out in the table.
|
Rate increase |
Full Year Yield From PAYE Income Earners earning in excess of €150,000 |
Full Year Yield From Non-PAYE Income Earners earning in excess of €150,000 |
|
1% |
€13 million |
€32 million |
|
2% |
€25 million |
€65 million |
|
3% |
€38 million |
€97 million |
The Universal Social Charge is an individualised charge and as such, the estimate of yield is based on individual incomes of more than €150,000.
The estimated yield is based on confining the extension of the new Universal Social Charge rates to the portion of income which is in excess of €150,000, that is, the increase is not applied to the portion of total income earned up to €150,000.
This estimate is derived from the Revenue tax-forecasting model using actual data for the year 2010 adjusted as necessary for income and employment trends in the interim. It is, therefore, provisional and likely to be revised.
156. Deputy Michael McGrath asked the Minister for Finance if he will set out, in tabular form, the revenue that would be raised from increasing the universal social charge for PAYE earners and non-PAYE earners by 1%, 2% and 3%, respectively, for earnings above €200,000; and if he will make a statement on the matter. [36640/13]
View answerI am advised by the Revenue Commissioners that the full year yield, estimated by reference to 2013 incomes, of increasing the universal social charge by either 1 percentage point, 2 percentage points or 3 percentage points for all income earners with incomes in excess of €200,000 is set out in the table.
|
Rate increase |
Full Year Yield From PAYE Income Earners earning in excess of €200,000 |
Full Year Yield From Non-PAYE Income Earners earning in excess of €200,000 |
|
1% |
€8 million |
€26 million |
|
2% |
€16 million |
€52 million |
|
3% |
€24 million |
€78 million |
The Universal Social Charge is an individualised charge and as such, the estimate of yield is based on individual incomes of more than €200,000.
The estimated yield is based on confining the extension of the new Universal Social Charge rates to the portion of income which is in excess of €200,000, that is, the increase is not applied to the portion of total income earned up to €200,000.
This estimate is derived from the Revenue tax-forecasting model using actual data for the year 2010 adjusted as necessary for income and employment trends in the interim. It is, therefore, provisional and likely to be revised.
157. Deputy Michael McGrath asked the Minister for Finance if he will set out, in tabular form, the revenue that would be raised from reducing the annual earnings limit along with age-related percentage limits for maximum tax relievable contributions for pension purposes from €115,000 to €100,000, €90,000, €80,000, €70,000 and €60,000, respectively, if tax relief is granted at the marginal rate; the maximum rate of tax relief is reduced to 34%; the maximum rate of tax relief is reduced to 30%; and tax relief is reduced to 20%; and if he will make a statement on the matter. [36641/13]
View answerI assume that the Deputy is referring to the current annual earnings cap of €115,000 which operates to limit the level of tax-relieved personal pension contributions in any one year. The annual earnings cap acts, in conjunction with age-related percentage limits of annual earnings, to put a ceiling on the annual amount of tax relief an individual taxpayer can obtain on pension contributions. A breakdown of the cost of tax relief on employee contributions to occupational pension schemes is not available by income tax rate, as tax returns by employers to the Revenue Commissioners of employee contributions to such schemes are aggregated at employer level. An historical breakdown is available by tax rate of the tax relief claimed on contributions to personal pension plans — Retirement Annuity Contracts (RACs) and Personal Retirement Savings Accounts (PRSAs) — by the self-employed and others, to the extent that the contributions have been included in the personal tax returns of those taxpayers. There is, therefore, only a limited statistical basis for providing definitive figures. However, by making certain assumptions about the available information, the Revenue Commissioners inform me that the estimated full year yield to the Exchequer from reducing the current annual earnings cap of €115,000 to the thresholds outlined in the question, and at the various specified marginal tax rates, in respect of individual contributions to occupational pension schemes, RACs and PRSAs would be as shown in the following table. These estimates take no account of any behavioural impacts which may arise from the proposed changes and which could effect the scale of any yield under the various scenarios outlined.
Exchequer Yield
Reduction in Relief Allowable at specified Marginal Tax Rates
|
Reduced Earnings Cap (below €115,000) |
- |
- |
- |
- |
|
€ |
Current Rate |
34% |
30% |
20% |
|
€100,000 |
€35m |
€155m |
€244m |
€490m |
|
€90,000 |
€65m |
€165m |
€274m |
€510m |
|
€80,000 |
€95m |
€210m |
€300m |
€535m |
|
€70,000 |
€130m |
€240m |
€329m |
€555m |
|
€60,000 |
€175m |
€265m |
€354m |
€580m |
158. Deputy Michael McGrath asked the Minister for Finance the revenue that would be raised from increasing the rate of deposit interest retention tax to 35%; and if he will make a statement on the matter. [36643/13]
View answerI am advised by the Revenue Commissioners that the estimated additional yield to the Exchequer from increasing the Deposit Interest Retention Tax (DIRT) rate from 33% by 2% to 35% would be of the order of €35 million in a full year. This projection assumes no significant behavioural change by depositors or a change in interest rates applied by financial institutions to savings.
It should be noted that the figure given for the yield from a 2% increase in the DIRT rate is a downward revision of a figure provided in reply to a previous related question, No. 68 on 25 April last (ref PQ 19659/13). The revision is necessitated by a revision to the basic data becoming available in the interim.
159. Deputy Michael McGrath asked the Minister for Finance the revenue that would be raised from increasing the capital gains tax rate to 35%; and if he will make a statement on the matter. [36644/13]
View answerI am advised by the Revenue Commissioners that the full year yield to the Exchequer, estimated in terms of expected 2013 gains, from increasing the CGT tax rate from 33% to 35% could be in the region of €31 million. This figure includes corporate gains. However, this estimate assumes no behavioural changes on the part of taxpayers, and increases in rates may have a significant behavioural impact and may not produce a corresponding increase in tax yield. In current economic conditions any estimate of additional yield must be treated with caution. In addition, increasing the rate could, in theory, lead to a reduction in yield from the tax.
160. Deputy Michael McGrath asked the Minister for Finance the revenue that would be raised from increasing the capital acquisitions tax rate to 35%; and if he will make a statement on the matter. [36645/13]
View answerI am advised by the Revenue Commissioners that the estimated full year yield to the Exchequer from increasing the Capital Acquisitions Tax rate by 2% to 35 %, based on the expected outturn in 2013, could be in the region of €18 million, assuming no change in the existing thresholds. This estimate is provisional and subject to revision. It should be noted that this estimate is based upon an assumption that there would be no behavioural impact of this change, which could lead to a less than expected impact on Exchequer yield. In addition, the realization of any estimated yield from an increase in taxation on assets relating to property is subject to movements in the value of such assets, which are currently occurring in the economy.
161. Deputy Michael McGrath asked the Minister for Finance the revenue that would be raised from applying a 5% tax to national lottery winnings above €1000; and if he will make a statement on the matter. [36646/13]
View answerI am advised by the National Lottery that the total winnings over €1,000 in 2011 was of the order of €190 million. On this basis a tax or levy of 5% on National Lottery winnings over €1,000 would yield € 9.5 million. It was not possible to obtain the comparable figures for 2012 in the time available.
For reasons of equity, a levy such as is proposed in the question might have to be imposed on winnings over €1,000 from other lotteries, which could affect fundraising by charities and sports clubs.
Section 5 of the National Lottery Act 1986 provides that the surplus from the National Lottery may be used for the following purposes: national culture, including the Irish language; the arts, within the meaning of the Arts Act 1951; the health of the community; and for such other purposes as the Government may determine. The following categories have been so determined: youth, welfare, national heritage and amenities. A levy might have a behavioural effect on participation and reduce the surplus available for these purposes.
National Lottery winnings are currently specifically exempted from Income Tax, Capital Gains Tax and Capital Acquisitions Tax. I do not propose at this time to introduce a tax such as is suggested by the Deputy.
162. Deputy Michael McGrath asked the Minister for Finance for each of the State-supported banks, the number of split mortgage arrangements that have been offered to mortgage holders to date in 2013; the number of such arrangements that have been entered into; and if he will make a statement on the matter. [36670/13]
View answerI can inform the Deputy that the State supported banks have provided me with the following information in relation to their split mortgage offerings.
AIB
I have been informed by AIB that split mortgage arrangements are one of the options in AIB’s advanced forbearance solutions. All disclosures in relation to forbearance are available on pages 101-103 of AIB’s 2012 Annual Financial Report. AIB has informed me that this information will be updated on 1st August when AIB announces its 2013 interim results.
BOI
I have been informed by Bank of Ireland that it is currently in a closed period, as it prepares for publication of its Interim Results to June 2013 on 2 August 2013. The Bank will update the market generally on progress of its Mortgage Arrears strategy on the occasion of publication of the half-year results.
PTSB
I have been informed by Permanent TSB that it has offered c. 1,500 split mortgages to date in 2013, of which c. 1,000 have been accepted. Permanent TSB has advised me that the significant majority of these offers are subject to the satisfactory establishment of a repayment record over a six month period. Upon satisfactory completion of this term the offer is confirmed.
163. Deputy Michael McGrath asked the Minister for Finance for each of the State-supported banks, the number of principal dwelling house mortgages and buy-to-let mortgages in respect of which the bank sought full repayment of the loan from the borrower but has not yet initiated legal proceedings for repossession; and if he will make a statement on the matter. [36671/13]
View answerI have received the following information from the State supported banks in answer to your query:
AIB
AIB has informed me that the bank only initiates a legal solution, which may ultimately lead to the bank taking possession of a property, when a customer in difficulty is not cooperating with the bank or making a genuine effort to engage or resolve arrears on the mortgage account. It is generally not the Bank’s practice to demand full repayment of a mortgage in arrears prior to the bank initiating steps which may ultimately lead to the bank taking possession of the property. The Bank’s focus is on providing sustainable solutions to mortgage customers that will allow them to exit from arrears.
Bank of Ireland
I have been informed by Bank of Ireland that it is currently in a closed period, as it prepares for publication of its Interim Results to June 2013 on 2 August 2013. The Bank will update the market generally on progress of its Mortgage Arrears strategy on the occasion of publication of the half-year results.
PTSB
I have been informed by Permanent TSB that it has sought full repayment of the loan on 1,119 principal dwelling house and 11 buy-to-let mortgage accounts but has not yet initiated legal proceedings for repossession on them.
164. Deputy Michael McGrath asked the Minister for Finance the number of legal proceedings that Irish Bank Resolution Corporation, in special liquidation, is currently a party to; the number of different law firms representing IBRC in these cases; the anticipated amount to be spent in the current year on legal costs; and if he will make a statement on the matter. [36672/13]
View answerI am advised that due to commercial confidentiality and sensitivities the Special Liquidators are unable to provide a breakdown of the type requested. All relevant disclosures in respect of legal cases involving IBRC are publically available through the Courts Services website. I have been advised by the Special Liquidators that there were 120 cases being taken against IBRC at the date of liquidation. Furthermore, there were 720 cases being taken by IBRC against a variety of defendants but primarily against borrowers, former staff and former professional advisors.
In July 2012, following a process conducted in accordance with best practice, IBRC put in place a revised formal legal panel of Irish law firms, with a central part of this process being a reduction in legal fees charged to IBRC. IBRC’s legal panel is diverse in terms of the size and scale of firms that are panel members and also includes a geographical spread.
In continuing to deal with the multitude of unprecedented, exceptional and novel issues and challenges faced as a result of the Special Liquidation, the Special Liquidators, as a matter of prudential and commercial control and oversight, require all necessary and appropriate legal and professional advice, however, they remain extremely mindful of the imperative to reduce expenditure on legal fees.
165. Deputy Michael McGrath asked the Minister for Finance if he will provide details, including the number of enforcement actions being taken by the Central Bank of Ireland against regulated entities; if he will categorise the nature of the actions being taken; and if he will make a statement on the matter. [36673/13]
View answerThe Central Bank’s Strategic Plan 2013 – 2015 sets out a strategy of assertive risk-based supervision underpinned by a credible threat of enforcement. Enforcement is an important tool to effect deterrence, achieve compliance and promote positive behaviour. The Central Bank will take enforcement action against regulated entities under its Probability Risk Impact Supervisory System (PRISM) supervisory model. PRISM represents a challenging and proportionate risk-based system of supervision for all financial institutions operating in Ireland. During 2012, the Central Bank entered into 16 settlement agreements. The sanctions imposed included 16 fines, totalling €8.5m, and 16 reprimands. The Central Bank took a total of 841 regulatory actions in 2012, an increase from 494 in 2011. A detailed breakdown of regulatory actions for 2011 and 2012 can be found on the Central Bank’s Annual Performance Statement (Financial Regulation) 2012-2013 which is available on the Central Bank website.
I am advised by the Central Bank that for legal reasons, including the Bank’s confidentiality obligations pursuant to section 33AK of the Central Bank Act 1942, no details on the number or nature of cases being presently taken by the Enforcement Division can be disclosed.
I would like to point out that the recently-enacted Central Bank (Supervision and Enforcement) Act 2013 enhances the powers of the Central Bank in a number of important respects:
- Customer redress for problems that are widespread or regular, such as overcharging or systems failures;
- Debt management: a regulatory regime for debt management and debt advice;
- Whistleblower protections;
- Central Bank regulation-making powers on a range of conduct of business areas, including consumer protection;
- Enforcement: this includes restitution orders and the recoupment of investigation costs from those found guilty of an offence;
- A doubling of the maximum administrative sanction to €1m for an individual and €10 million for a firm;
- Enhanced powers of inspection, investigation and information gathering for Central Bank authorised officers;
- Auditor assurance: Central Bank power to require an auditor to provide a written report on compliance by a financial service provider with certain requirements.
Question No. 166 answered with Question No. 121.
