Written Answers Nos. 61-77
61. Deputy Terence Flanagan asked the Minister for Finance if his attention has been drawn to concerns of taxpayers regarding having to pay the property tax for once-off payments so far in advance of when the tax is actually due; and if he will make a statement on the matter. [47652/13]
View answer68. Deputy John O'Mahony asked the Minister for Finance if he will extend the deadline from 1 January 2014 for persons who wish to pay their local property tax in full by cash as the date for payment is 1 January 2014; if he will extend this deadline to 1 March 2014; and if he will make a statement on the matter. [47739/13]
View answer71. Deputy Eoghan Murphy asked the Minister for Finance the reason those paying the property tax for 2014 using a credit or debit card cannot pay the tax in the year in which it is due; and if he will consider extending the deadline for such payments to the end of January 2014 or later. [47786/13]
View answer81. Deputy Tom Fleming asked the Minister for Finance if he will intervene and give householders a reasonable time in which to pay the property tax for 2014; and if he will make a statement on the matter. [47874/13]
View answerI propose to take Questions Nos. 61, 68, 71 and 81 together.
Similar questions concerning payment of the 2014 LPT liability have been raised by a number of Deputies previously and I provided a detailed reply on 5 November to Questions Nos. 143 [47110/13], 202 [46491/13], 214 [46815/13], 215 [46879/13], 216 [46881/13], 229 [46999/13], 232 [47059/13], 239 [47101/13], and 252 (47136/13) which addresses many of the issues raised by Deputies in these Questions.
There is no requirement on any property owner to pay their 2014 LPT before 1 January 2014. Furthermore, the Revenue Commissioners have made payment options available which provide property owners with options to pay in phased payments during 2014 or in one single debit from their current account as late as 21 March 2014. Property owners are fully entitled to change their chosen payment method for 2014, and also entitled to apply for a deferral of the tax if they consider that they are entitled by reference to their financial circumstances, by completing the LPT return on paper or online.
I am satisfied that the range of payment options are such that no property owner has to pay their LPT liability for 2014 before the end of this year unless they choose to do so and I note that the Chairman of the Revenue Commissioners informed the Joint Oireachtas Committee on Finance, Public Expenditure and Reform that large numbers of property owners have been successfully filing returns and selecting a payment option for 2014. The Committee was also informed that, due to the volume of queries regarding Local Property Tax (LPT) payment methods from people who filed their 2013 return on paper, the Commissioners have extended the 2014 paper LPT filing deadline from 7 to 14 November 2013.
62. Deputy Terence Flanagan asked the Minister for Finance the action being taken to reduce call waiting times in the local property tax section of the Revenue Commissioners (details supplied); and if he will make a statement on the matter. [47653/13]
View answerI am advised by Revenue that the introduction of Local Property Tax (LPT), which was the largest extension of the self-assessment system in its history, represents a very great administrative challenge. For example, Revenue has answered in excess of 580,000 telephone calls and replied to in excess of 200,000 letters or emails since March 2013. Revenue has further advised that because LPT is a new tax it is difficult to anticipate service volumes, and as a consequence the number of agents required.
Revenue has acknowledged that exceptional delays in accessing the helpline, which is the primary contact point for LPT queries, were experienced by some callers in the days immediately following the issue of the 2014 notifications. Access was also hampered on an intermittent basis on those days by technical issues in the service provider’s telephony system, which have since been resolved.
In response to the demand for service, Revenue ensured that extra resources were deployed to the helpline within two days of the peak period occurring and also deployed extra resources to its own internal support service to cater for the more complex queries. It has put contingency plans in place to further rapidly increase the number of agents on the helpline should it be necessary to do so. In total there are now 200 agents fully deployed to LPT telephone call handling. In addition to the extra staff deployment, callers can now leave their telephone contact details on the system in preference to waiting for service and will receive an out of hours ‘call back’ from the LPT team. Revenue has extended the helpline opening hours from 9am to 5pm to 8am to 8pm since 6 November and will maintain these hours for the peak filing periods.
Revenue has also extended the paper filing date by one week to 14 November to allow people further consider their 2014 payment method before committing their preferred option to Revenue. The combined initiatives of additional deployments, extended opening hours and the extended paper deadline have already significantly reduced the waiting times on the helpline.
Finally, I again commend Revenue for the excellent work it has done in taking LPT from concept to a fully functioning tax in such a short period of time, including the drafting of legislation, the building of a brand new property register, the provision of customer service to such a large volume of taxpayers and crucially the contribution of €215m to date to the Exchequer.
63. Deputy Terence Flanagan asked the Minister for Finance the position regarding the payment of property tax in respect of a person (details supplied) in Dublin 13; and if he will make a statement on the matter. [47655/13]
View answerI am advised by Revenue that there is no obligation on any person to pay their Local Property Tax (LPT) liability for 2014 before 1 January unless they choose to do so to suit their own circumstances.
In October, Revenue wrote to all property owners who paid their 2013 LPT liability in a single payment to remind them of their obligations in regard to 2014. Revenue used the opportunity to clearly outline the various payment options that are available for LPT as a guide to people who might want to change their payment method for 2014, given that it is a full year liability. Revenue also needs to ensure it has enough lead in time to process all phased payment applications in advance of 1 January so that taxpayers may spread their payments over a full year.
Revenue’s intention in providing seven different payment methods for LPT is to ensure people have the flexibility to meet their liability in a way that best suits their individual circumstances, whether by a single payment or on a phased basis spread out over the year. The options are:
- Phased payment by monthly Direct Debit
- Phased payment by Deduction at Source from salary, pension or certain Government payments
- Single Debit Authority, which is a mandate to debit a bank account once only
- Credit Card
- Debit Card
- Cheque or Postal Order.
- Service Providers, namely An Post, Payzone and Omnivend
On the specific case to which the Deputy refers, Revenue issued a 2014 payment reminder letter to the person in question via his ROS inbox. The letter included a Property ID, PIN and confirmed the amount due for 2014. As the person in question is a ‘multiple property owner’ the letter confirmed the total amount of LPT due on all of his properties.
It is noted that the person in question wishes to meet his 2014 LPT liability by using his debit card. While this is his choice, Revenue has clearly stated on numerous occasions that any such card payment will be debited immediately. This is the nature of card payments. If the person does not want to pay before 1 January it is open to him to choose one of the other options listed above.
As I previously advised the House, all property owners with a debit card also have a bank account. If the property owner concerned wishes to pay in full in one payment in 2014 from the bank account which is attached to his debit card, he has the option to do so. I can confirm that if he uses this option his account will not be debited until 21 March 2014 unless he specifies an earlier payment date. To do this property owners should select and complete the option entitled "single debit authority", which is the second option, when filling out their property tax return online. The Commissioners advise that the single debit authority payment option is drawn on a person's current account in the same way as a debit card payment.
Finally, the person’s concern about the Christmas retail market is noted. However, Revenue has provided payment options which allow people not to pay their full LPT liability until well after Christmas, or in phased payments throughout 2014, should they so choose. I believe that the arrangements are more than adequate and I do not intend to intervene.
64. Deputy Michael P. Kitt asked the Minister for Finance if he has received a proposal that the State buy ACC Bank from Rabobank Ireland; and if he will make a statement on the matter. [47659/13]
View answerI can confirm that I have received correspondence from a third party, an employee representative organisation which suggest that the Government could somehow benefit from the acquisition of ACC’s banking architecture and employee skill set. My officials are examining the correspondence and will respond in due course.
65. Deputy Joan Collins asked the Minister for Finance the position regarding fuel tax and excise duty allowances for persons with a disability in respect of a person (details supplied) in Dublin 12; and if he will make a statement on the matter. [47666/13]
View answerI am informed by the Revenue Commissioners that Section 92 of the Finance Act 1989 and the Disabled Drivers and Disabled Passengers (Tax concessions) Regulations, 1994 (S.I.353 of 1994) provide for relief from the payment of Excise Duty on specified quantities of fuel used for transporting persons registered under the scheme.
The person (details supplied) submitted an application for refund of excise duty on fuel on 29 July 2013. This application form was returned on the same date informing the person that all refunds of excise duty on fuel are made on a yearly basis and to re-apply in February 2014. The information leaflet published by Revenue on the scheme (VRT 7) makes it clear that the relief from excise duty on fuel can only be claimed on an annual basis (section 7.3.3). Revenue has no control over information published on other websites and the reference quoted does not reflect Revenue policy.
Revenue’s Central Repayments Office handles a very high volume of claims under all the provisions of the scheme. For operational and efficiency reasons, fuel claims can only be processed on an annual basis. Claims for shorter periods would risk giving rise to delays as the volumes to be processed would be tripled and the amounts involved would be relatively small in the majority of cases. Furthermore, accepting refund claims for an annual period is the normal practice which applies to other tax refunds such as medical expenses.
As a concession to facilitate the person (details supplied), all his shorter-term claims for the current year will be processed. However, from 2014 onwards, yearly claims only can be accepted as explained above.
66. Deputy Mick Wallace asked the Minister for Finance the reason, in view of recent research by TASC, the ESRI, and the Department of Social Protection highlighting the regressive nature of elements of budget 2013 and its disproportionate impact on certain sections of Irish society, there are still no plans to equality-proof the next budget; and if he will make a statement on the matter. [47706/13]
View answerAs the Deputy will be aware, the Programme for Government contains a commitment to require all public bodies to take due note of equality and human rights in carrying out their functions. Furthermore, the Cabinet handbook requires a statement on the likely effects of the decision sought on equality and persons experiencing or at risk of poverty or social exclusion to be included in Memoranda to Government. Consequently, Government does consider each of these important issues at an individual policy or programme level. Furthermore, I would remind the Deputy that the State and its bodies take the provisions of equality legislation into account in the development and delivery of policies and services.
I would also like to inform the Deputy that a distributional analysis of taxation measures is performed based on various income levels for the different categories of income earners. These categories include single individuals, married one-earner couples with no children and married one-earner couples with children. A distributional analysis which models the impacts on disposable income by income decile using SWITCH, the ESRI Tax-Benefit model, is also undertaken in evaluating various taxation options. Illustrative examples continue to be included in Budget documents.
In future, as part of our annual Budget, Ireland will submit a draft budgetary plan to the Commission no later than 15 October. This is under Regulation 473/2013, which specifies that all euro area Member States not in a macroeconomic adjustment programme will be required to submit this plan.
As part of the material supplied, Article 6 (3) (d) requires where possible, “indications on the expected distributional impact of the main expenditure and revenue measures” should be included. This distributional analysis will be conducted through the SWITCH model, as has been seen in previous Budgets.
I feel it is important to highlight the progressive nature of the Irish taxation system when discussing matters of equality. The European Commission compares progressivity of taxation by taking the OECD tax wedge for an individual earning 167% of the average wage and dividing it by the tax wedge for an individual earning 67% of the average wage. On a rating system where less than 100 is regressive and above 100 is progressive, most EU countries have a progressivity rate of between 120 and 140. Ireland, in comparison, has a progressivity rate of 190. While Ireland’s progressivity rate decreased from 220 to 190 in 2012 following the changes introduced in Budget 2011 and 2012, this is still far more progressive than any other EU member of the OECD.
67. Deputy Mick Wallace asked the Minister for Finance if he will consider the adoption of a new wealth tax in Ireland, as set out in the newly published working paper, a collaboration between the Nevin Economic Research Institute and TASC, which outlines the options for such a tax here; and if he will make a statement on the matter. [47707/13]
View answerThe Think Tank for Action on Social Change (TASC) and Nevin Economic Research Institute (NERI) working paper Wealth Tax - Options for its Implementation In the Republic of Ireland, to which the Deputy refers, has not advocated a specific form of wealth tax but it has analysed a number of options and discussed issues relating to the introduction of a wealth tax. The paper suggests that a yield of 0.1% of GDP, which would be in the region of €160 million, is attainable from a wealth tax where the threshold of liability is set at €1 million and the tax rate is set at 0.6%. As I have stated in reply to a number of Parliamentary Questions in the past, to estimate the potential revenue from a tax on wealth one would need to identify the wealth held by individuals, which is not possible from the data available at present.
The paper has considered whether certain assets should be relieved or deductible for the purposes of the tax. It argued that owner-occupied houses should not be exempt from a wealth tax, which would mean that houses could be subject both to the Local Property Tax and to the wealth tax. The paper also argues against exemptions for business assets if the threshold for the wealth tax is sufficiently high. Careful consideration would have to be given to such a measure. In particular, the Government would not wish to introduce a tax which could deter the growth of enterprises in the economy. While all taxes and potential taxation options are constantly reviewed, the Government has no current plans to introduce a wealth tax.
69. Deputy John O'Mahony asked the Minister for Finance if he will provide a telephone and-or e-mail service for Members of the Oireachtas for the Revenue Commissioners local property tax service due to the large volume of calls and the fact that persons and Oireachtas Members are unable to receive information from constituents as constituents are unable to get through or are left holding on the property tax local call number for more than 50 minutes; and if he will make a statement on the matter. [47740/13]
View answerRevenue has acknowledged to me that exceptional delays in accessing the Local Property Tax (LPT) Helpline, which is the primary contact point for LPT queries, were experienced by some callers in the days immediately following the issue of the 2014 notifications. In response to the demand for service, Revenue deployed extra resources to the helpline, within two days of the peak period occurring and also deployed extra resources to its own internal support service to cater for the more complex queries. Revenue has put contingency plans in place to further rapidly increase the number of agents on the helpline should it be necessary to do so. In total there are now 200 agents fully deployed to LPT telephone call handling. In addition to the extra staff deployment, callers can now leave their telephone contact details on the system in preference to waiting for service and will receive an out of hours ‘call back’ from the LPT team. Revenue has also extended the helpline opening hours from 9am to 5pm to 8am to 8pm since 6 November and will maintain these hours for the peak filing periods.
I have been assured by the Revenue Commissioners that the helpline is sufficiently well serviced to deal with queries from customers and waiting times having significantly reduced in recent days. The Commissioners have confirmed that in view of this, there are no plans to put in place a dedicated helpline or email for Oireachtas Members for LPT related queries. The Commissioners further note that there is already a dedicated phone service in place for Oireachtas Members (01 6748102) who have any tax related queries.
70. Deputy Michael Moynihan asked the Minister for Finance if a farmer who owns five different lots of land and now wishes to buy a new farm, under the provision of the Finance Act, and wants to consolidate their farm holdings will have to pay capital gains tax; and if he will make a statement on the matter. [47759/13]
View answerI made provision in Budget 2013 for the following measure designed to assist farmers with consolidation of farm land. This measure followed on from measures in the previous year’s Budget which also supported farm expansion and the transfer of land. Section 48 of Finance Act 2013 provides for relief from capital gains tax on disposals of farm land for farm restructuring, subject to a Commencement Order, which I made on 6 June 2013. The terms of the relief are set out in Section 604B, Taxes Consolidation Act 1997.
The relief applies to a sale, purchase or exchange of agricultural land in the period from 1 January 2013 to 31 December 2015 where Teagasc has certified that a sale and purchase or an exchange of agricultural land was made for farm restructuring purposes. The initial sale or purchase, or the exchange, must occur in the relevant period and the subsequent sale or purchase must occur within 24 months of that sale or purchase.
Full relief from capital gains tax will be given where the consideration for the purchase or the exchange is equal to or exceeds the consideration for the sale or the other land that is exchanged. Where the consideration for the purchase or the exchange is less than the consideration for the land that is sold or the other land that is exchanged, relief will be given in the same proportion that the consideration for the land that is purchased or exchanged bears to the consideration for the land that is sold or the other land that is exchanged.
Provision is made for the clawback of the relief where qualifying land in respect of which relief has been given is disposed of within 5 years of the date of the purchase or exchange of that land. A clawback does not apply where the disposal arises under a compulsory purchase order.
A prerequisite to any disposal and acquisition of farm land qualifying for this relief is that an application for a farm restructuring certificate is made to Teagasc and that Teagasc grants such a certificate (that has not been withdrawn). Guidelines relating to the application for, and the issue of, a Farm Restructuring Certificate are available on the Department of Agriculture, Food and the Marine’s website.
Based on the limited information available, it is not possible to say definitively whether all conditions governing the relief are satisfied – in particular:
- Whether the lands are qualifying lands (i.e. whether a farm restructuring certificate has been issued by Teagasc and has not been withdrawn)
- Whether or not the sales are as a result of a compulsory purchase order
- Whether the full proceeds of the sales are invested in the purchase of the new land
- Whether the person in question is an individual who spends not less than 50% of his or her normal working time farming.
72. Deputy Eoghan Murphy asked the Minister for Finance if he has considered extending the reduced 9% VAT rate to the entertainment industry. [47787/13]
View answerAs you will be aware, the 9% reduced VAT rate applies to tourism related activity in order to promote that industry. In this context, various entertainment services already apply at the 9% rate, including admissions to cinemas, theatres, certain musical performances, museums, art gallery exhibitions, fairgrounds/amusement parks, open farms, historical houses. The use of sporting facilities, including green fees charged for golf and subscriptions charged by non-member-owned golf clubs, also apply at the 9% rate. Furthermore, live theatrical or musical performances are exempt from VAT, where alcohol drink is not available in the venue during the performance.
Admission to and promotion of dances is liable to VAT at the 23% standard rate. In addition, services by artists, bands and disc jockeys to a venue promoter are also liable to VAT at 23%. The VAT rating of goods and services is subject to the requirements of EU VAT law with which Irish VAT law must comply. The EU VAT Directive does not allow for the possibility of a reduction in the VAT rate to 9% for the promotion of dances and the provision of such music services.
73. Deputy Eoghan Murphy asked the Minister for Finance if he will clarify a situation regarding a decision by the Revenue Commissioners on the levying of VAT retrospectively (details supplied). [47790/13]
View answerI am informed by the Revenue Commissioners that a Revenue audit was conducted on the firm in question. The audit identified a number of liabilities, including interest and penalties. These additional liabilities were accepted and agreed, in writing, by the proprietors. The principal component of the additional liabilities arose from the non-operation of VAT on the supplies of goods and services made by the firm. The particular goods and services as supplied by the firm in question are subject to VAT, and this applies to any operator that provide the same goods and service in the industry in question. The firm in question has now initiated High Court proceedings disputing the settlement reached with Revenue.
74. Deputy Pearse Doherty asked the Minister for Finance the number of persons affected by the change to the single parent tax credit by county. [47809/13]
View answerI am advised by the Revenue Commissioners that based on the most up to date data it is estimated that up to 15,400 individuals may be affected by the restriction of the restructured credit to the principal carer. However, ultimately it will depend on the circumstances of each individual carer and the allocation of childcare responsibilities, which is primarily for parents to agree.
I am also informed by the Revenue Commissioners that, as the individuals who are likely to be affected by the Budget changes are not specifically identifiable on Revenue tax records, the statistical basis for measuring the impact of the changes was an estimate of aggregated numbers, which are not geographically identified. Accordingly, there is no basis on which a distribution of these individuals by county could be compiled.
75. Deputy John Lyons asked the Minister for Finance if he will ensure that any future correspondence from the Revenue Commissioners to property owners is reviewed by the National Adult Literacy Agency or similar body to ensure it is jargon free, in plain English and easily accessible for those with varying literacy levels. [47817/13]
View answerI am advised by Revenue that it is very conscious of the importance of making sure that its communications with all taxpayers, including property owners, is as simple and understandable as possible. Its objective is always to convey information that meets the “plain English” standard so that taxpayers readily understand their entitlements and obligations, and it has full regard to information or suggestions on an on-going basis as to how information can be made clearer. I understand that, to strengthen its approach further, Revenue is currently preparing a protocol for customer information publications. This protocol will include the latest National Adult Literacy Agency (NALA) guidelines for presenting information in plain English. Where major new documentation is being published (such as documents explaining changes to operation of the PAYE system) Revenue liaises with its own customer consultative panels, a range of representative bodies, in particular those representing older persons, and organisations like NALA to ensure that the language used to explain the changes is simple and easy to understand.
In her appearance before the Joint Committee on Finance, Public Expenditure and Reform on 7 November the Chairman of the Revenue Commissioners reminded the Committee that the Local Property Tax (LPT) is the largest extension of the self-assessment system in its history. This is a new tax, with new concepts and new language for many of Revenue’s customers and likewise for Revenue staff.
Revenue has made every effort to make it as easy as possible for property owners to understand this new tax and how it will impact on them. On the day I announced the introduction of LPT (Budget Day 5 December 2012), Revenue published Frequently Asked Questions (FAQs) on its website which provided details of how the tax would operate in simple English. In fact Revenue received much positive feedback on the clarity of the information provided on their website. This information was made available to property owners more than six months before the tax was introduced and it is updated regularly as issues requiring clarification emerge. Revenue also confirmed that it had extensive engagement with many representative bodies and the Citizens’ Information Service, all of whom were provided with copies of the LPT1 form, LPT Guide and the letter to property owners. Between March and April this year Revenue issued letters to property owners and included a LPT Guide which explained the operation of LPT and the range of options for paying the tax. The Guide was in a “question and answer” answer format to make it as user friendly as possible.
For the issue of letters to about 988,000 property owners in October, Revenue placed advertisements in national and provincial newspapers and developed a number of “frequently asked questions” specifically for the 2014 filing period. In addition, spokespersons were also provided for national and local media.
I am satisfied that Revenue will fully take on board the communications related issues that have arisen over the past number of weeks and will take whatever steps are necessary to ensure that key messages in its LPT and other correspondence are as easily understood as possible.
76. Deputy Patrick O'Donovan asked the Minister for Finance following the death of a person (details supplied) in County Wexford, if the local property tax for 2013 was paid; if he will indicate the person liable for the local property tax for 2014; and if he will make a statement on the matter. [47821/13]
View answerI am advised by the Revenue Commissioners that Section 11(3)(d)(I) of the Local Property Tax Act 2012 (as amended) provides that a person having an exclusive right of residence in a property for his or her life is deemed to be the liable person for LPT purposes. In regard to the specific case mentioned by the Deputy, if the current occupant of the property in question was entitled to right of residence on 1 November 2013, they are liable to pay LPT in respect of that property for 2014.
I can confirm that the 2013 LPT liability has been partially paid. The deceased person filed an LPT Return for 2013 and declared a valuation in the ‘Band 2’ category with a liability of €112. She opted to pay by direct debit. At this point there is an outstanding liability of €37 due on the property as the last two scheduled payments remain outstanding.
In general Section 11 (3) (e) of the Local Property Tax Act 2012 (as amended) provides that the personal representative of the estate of a person who was a liable person is responsible for LPT liabilities. While the full circumstances of this case are not known it appears that the personal representative is liable to pay the balance of LPT due for 2013 and should now make arrangements to do so. For the Deputy’s information, there is also a second property associated with the deceased person, which she declared as uninhabitable and on that basis is not liable for LPT. Finally, if the liable person requires further information or assistance with making payment s/he should contact the LPT Helpline at 1890 200255.
77. Deputy Niall Collins asked the Minister for Finance if a person with a local authority shared ownership property is liable for the full amount of the local property tax; and if he will make a statement on the matter. [47856/13]
View answerThe Finance (Local Property Tax) Act 2012 (as amended) provides that a liability for Local Property Tax (LPT) will arise where a person owns a residential property on the liability date, which was 1 May 2013 for 2013 and 1 November 2013 for the year 2014. Section 7 of the Act provides that local authorities will be liable to pay the LPT on their properties in the same way as any other residential property owner, unless the properties in question are used to accommodate people with special housing needs such as the elderly or people with disabilities.
However, residential properties purchased under the various local authority shared ownership schemes will also be subject to LPT and that the liable person in these instances will be the purchaser. This is on the basis that, under these schemes, the purchaser acquires a leasehold interest in the property for a period that exceeds 20 years. Such a purchaser is in the same position as a property owner who purchases a residential property with a mortgage from a financial institution. Accordingly, there is no reason why such an individual should not be liable for payment of the LPT on the property.
I am informed by the Commissioners that LPT is a self-assessed tax and it is a matter for the person who is purchasing a local authority shared ownership residential property to calculate the tax due based on his or her assessment of the chargeable value of the property and to make a Return to Revenue.
