Dáil Éireann Debate, Tuesday - 5 November 2013
175. Deputy Tom Fleming asked the Minister for Finance if he will review the budget 2014 proposal in respect of tax relief credits for single parents as it will mean a cut of €32 per week for the non-primary carer or €1,650 per year; if he will take into consideration that thousands of non-primary carers are care sharing two and three days every week and are paying maintenance; and if he will make a statement on the matter. [46111/13]
View answerAs the Deputy is aware, the One-Parent Family Tax Credit is being replaced with a new Single Person Child Carer Tax Credit from 1 January 2014. The Single Person Child Carer Tax Credit will be of the same value, i.e. €1,650, as the existing One-Parent Family Tax Credit and will also carry the same entitlement to the extended standard rate tax band of €36,800 per annum. The new credit will be targeted such that it is available only to the primary carer of the child. A maximum of one credit will be available per single carer/claimant, regardless of whether he or she cares for more than one child. This is the same condition that applies to the current One-Parent Family Tax Credit. Given the difficult fiscal environment it is essential to review all tax reliefs, credits and incentives in order to ensure that they are properly targeted and if necessary re-focused in order that they can achieve the socio-economic objectives that are set for them. A system that allows multiple claims in respect of the same child is unsustainable.
The Commission on Taxation acknowledged that the One-Parent Family Tax Credit plays a role in supporting and incentivising the labour market participation of single and widowed parents. However, in its recommendations it concluded that the credit should be retained but that it should be allocated to the principal carer only. The restructuring of the credit will achieve such an outcome.
Allocation of childcare responsibilities is primarily for parents to agree. Practical implementation issues are being considered as part of the Finance Bill process.
