Written Answers Nos. 151-65
151. Deputy Simon Harris asked the Minister for Finance the number of households which have not confirmed their payment method for the local property tax, excluding those who have opted for deferred payment; the way Revenue intends to pursue defaulters; and if he will make a statement on the matter. [1549/14]
View answer152. Deputy Simon Harris asked the Minister for Finance the way in which the Revenue Commissioners intend to pursue defaulters of the €100 household charge; and if he will make a statement on the matter. [1550/14]
View answerI propose to take Questions Nos. 151 and 152 together.
I am informed by the Revenue Commissioners that a compliance rate of 91% has been achieved for the Local Property Tax (LPT) for 2013. The Commissioners have also confirmed that by the end of December 2013 the amount of LPT collected for 2013 was €242m and €76m was collected in respect of 2014. In the region of 78% of liable persons have already confirmed their payment method for their 2014 LPT liability and a constant number of property owners continues to submit their 2014 payment instructions to Revenue each day. Since the start of the New Year, LPT payments in the order of €1m are being received every working day.
The Commissioners are also currently working through over 60,000 items of correspondence relating to property owners 2014 LPT obligations. They advise that any person who has submitted a genuine query (by email/letter/voicemail to the LPT helpline) regarding their 2014 liability in advance of the filing date will be treated as having complied with their requirements on time, once they file their payment instruction for 2014 promptly when the query is resolved. Processing returns which continue to be filed and dealing with this correspondence is Revenue's current priority. The Commissioners strongly advise anyone who has not yet confirmed their payment method to go on-line immediately to file their 2014 Payment Instruction in order to avoid interest charges. Where a person requires assistance with filing on-line or does not have their Property ID or PIN, they should call the LPT helpline on 1890 200 255.
On the Household Charge, as I informed the House in my reply to Questions 147 (54014/13) and 148 (54015/13) on 17 December 2013, section 156 of the Finance (Local Property Tax) Act 2012 (as amended) provides that where the €100 Household Charge for 2012 had not been paid by 1 July 2013 the arrears amount is increased to €200 and is regarded as Local Property Tax (LPT). The €200 arrears can be paid by property owners using any of the payment methods that are currently available for paying LPT. I understand that to date some €2.7m has been paid directly to Revenue in respect of about 13,500 properties and payments continue to be received on a daily basis.
An extensive data matching exercise has been undertaken by Revenue since it received the Household Charge database from the Local Government Management Agency (LGMA). The Commissioners have confirmed that about 1.3m records from the LGMA's Household Charge Register have been matched with the LPT Register but it will not be possible to fully match all Household Charge payments to the LPT Register. The main difficulty is where different people paid the Household Charge and the LPT for the same property; for example, where someone other than the owner paid the Household Charge, the owner's details will not be on the Household Charge Register. Mismatches arise particularly in the case of properties with non-unique addresses. The Commissioners estimate that approximately 45,000 properties fall into this unmatched category.
I strongly recommend that property owners check their LPT record online at www.revenue.ie using their Property ID and PIN. If Revenue's LPT record shows that there is €200 LPT/ Household Charge arrears but they have paid their Household Charge, they should send Revenue a copy of the receipt for the Household Charge and Revenue will remove the charge from the LPT record.
I previously informed the House that Revenue will begin a compliance campaign on LPT/Household Charge arrears in the first quarter of 2014. Two elements of this campaign have already been implemented. Persons who have outstanding LPT liabilities, including Household charge, will not receive a tax clearance certificate, and those whose 2013 LPT was deducted at source on a mandatory basis have been advised that this is continuing. Further elements of the campaign will be rolled out over the coming months supported by a public awareness campaign. These taxes cannot be avoided because the relevant properties cannot be transferred without payment of outstanding LPT liabilities.
The Revenue Commissioners have a duty, in the interests of fairness and equity to those who are compliant, to take effective follow-up action to recover the tax from the non-compliant. I support Revenue's approach, which is to seek to maximise the level of voluntary compliance from property owners in the first instance, but to apply the range of enforcement options and other sanctions available thereafter if non-compliance persists.
153. Deputy Terence Flanagan asked the Minister for Finance his plans to reduce the universal social charge or to reform it; and if he will make a statement on the matter. [1580/14]
View answerThe position is that the Universal Social Charge (USC) was introduced from 1 January 2011 to replace the Income Levy and the Health Levy. It was a necessary measure to widen the tax base, remove poverty traps and raise revenue to reduce the budget deficit. The Programme for Government contains a commitment not to change current income tax credits, rates and bands, nor to increase the marginal rate of tax. This commitment has been adhered to in Budgets 2012, 2013 and 2014.
May I remind the Deputy that although we have made considerable progress to date there remains a very large gap between what we spend and what we raise in revenue. We are committed towards reducing this deficit to below 3% of GDP by 2015 as we continue to repair the public finances. It is in this context that any decisions regarding reducing or reforming the USC will be made when determining the composition of Budget 2015 later this year.
154. Deputy Denis Naughten asked the Minister for Finance if there is a mechanism for an older person to revise the value of their property under the local property tax where they inadvertently accepted the Revenue Commissioners' figure which is significantly higher than the actual value of their home; and if he will make a statement on the matter. [1611/14]
View answerAs I have previously informed the House, most recently in my reply to Question No. 75 (51730/13) on 3 December 2013, the Local Property Tax (LPT) is a self-assessed tax so it is a matter for the property owner to calculate the tax due based on their assessment of the market value of the property. The Revenue Commissioners have confirmed to me that if a liable person has genuinely overpaid the tax through an error or mistake on their part, then the person should write to LPT Branch, Government Buildings, Ennis, Co Clare, clearly setting out how the overpayment arose and providing the relevant supporting documentation. Evidence could be in the form of recent sales or advertised house prices in the area, professional valuations or house price surveys for the area. Once the relevant documentation is received, the LPT Branch will make direct contact with the person. If the person overpaid the 2013 liability, it will be possible to offset some or all of the overpayment to the 2014 liability, if it is not already paid, or to make a repayment.
155. Deputy Michael McGrath asked the Minister for Finance if his attention has been drawn to the fact that the Revenue Commissioners have refused to issue a tax clearance certificate to compliant taxpayers because the Revenue is showing that the local property tax for 2014 has not been paid even if the person concerned made their return before the deadline and chose the single debit authorisation payment date of 21 March 2014; and if he will make a statement on the matter. [1620/14]
View answerI am advised by the Revenue Commissioners that there are a variety of possible reasons why a tax clearance certificate might be refused in any given particular case. One possibility which the Deputy may have overlooked is that unpaid household charge is now a Local Property Tax liability. In the absence of specific details it is not possible to provide further advice. However, if the Deputy has a particular case or cases in mind and he provides Revenue with the details including name, contact number and property ID, the circumstances surrounding the refusal of tax clearance will be investigated.
156. Deputy Joe McHugh asked the Minister for Finance if he will provide an estimate of the total fund in insurance companies with respect to the approved minimum retirement fund; and if he will make a statement on the matter. [1627/14]
View answerMy Department does not hold estimates of funds under management in insurance companies with respect to the approved minimum retirement fund. I have contacted the Central Bank and they inform me that they also do not maintain estimates of funds under management in insurance companies with respect to the approved minimum retirement fund. I understand that Insurance Ireland are currently collating an estimate of funds under management with respect to the approved minimum retirement fund. When this information becomes available I will send this information directly to the Deputy.
157. Deputy Micheál Martin asked the Minister for Finance if he has mentioned retrospective recapitalisation at any of his bilateral meetings with EU leaders; and if he will make a statement on the matter. [51399/13]
View answer158. Deputy Micheál Martin asked the Minister for Finance the position regarding his letter to the other 27 EU Heads of State on the need for retrospective recapitalisation of Irish banks; and if he will make a statement on the matter. [51398/13]
View answerI propose to take Questions Nos. 157 and 158 together.
The letter to which the Deputy refers was sent by the Taoiseach to the President of the European Council, Herman van Rompuy, and the Heads of State or Government in the other 27 EU Member states, for information, prior to the October 2013 European Council. The Taoiseach wrote his letter against the background of our planned exit from the EU/IMF Programme and stressed the need to deliver on long-standing commitments to break the vicious circle between banks and sovereigns.
The European Council conclusions, the agreed output of the summit, reflect the issues the Taoiseach highlighted in his letter to colleagues. The Deputy will be aware that the Euro-Area Heads of State or Government agreed on 29th June 2012 to break the vicious circle between banks and sovereigns, and that when a Single Supervisory Mechanism (SSM) involving the ECB, is in place and operational, the European Stability Mechanism (ESM) could recapitalize banks directly.
The Eurogroup meeting of 20th June 2013 agreed on the main features of the ESM’s Direct Bank Recapitalisation instrument (DBR). The DBR instrument will come into effect when the SSM is operational. There is a specific provision included in those main features that provides for retroactive recapitalisation. This provision states that: “The potential retroactive application of the instrument should be decided on a case-by-case basis and by mutual agreement.” Therefore, the agreement that we were active in negotiating keeps open the possibility to apply to the ESM for a retrospective direct recapitalisation of the Irish banks should we wish to avail of it. The SSM is expected to be place and operational towards the end of 2014.
Finally, I can assure the Deputy that the Irish case is made at all levels as appropriate and in this context I often engage on these matters with my European Ministerial colleagues. I remain confident that the commitment made by the EU HoSG in June 2012 to break the vicious circle between banks and sovereigns will be respected. The question of whether Ireland may apply for retroactive recapitalisation of our banks has yet to be decided upon and will, in due course, be a matter for Government, with any recommendation based on what is in Ireland’s best interest.
159. Deputy Micheál Martin asked the Minister for Finance the number of meetings he attended where the possibility of a precautionary credit line was discussed; and if he will make a statement on the matter. [50151/13]
View answerAs I undertook broad consultation regarding all of the available exit options, including the option of a precautionary credit line, it is difficult to put a precise figure on the number of meetings I attended on this matter. My consultations included discussions with Christine Lagarde, Managing Director of the IMF; Olli Rehn, Vice-President of the European Commission; Jeroen Dijsselbloem, President of Eurogroup; Wolfgang Schauble, German Finance Minister; Jack Lew, US Treasury Secretary; Pierre Moscovici, French Finance Minister; as well as my colleagues at both the Eurogroup and Ecofin Councils, along with discussions with the Troika teams during review missions. I also listened to the views of the Governor of the Central Bank of Ireland, the Chief Executive of the NTMA as well as taking advice from my own Department. The issue was also discussed at the Economic Management Council and Government. Following a careful and thorough assessment of all of the available options, the decision was taken to exit without a pre-arranged precautionary facility or backstop.
Following our decision to exit our programme without recourse to a precautionary credit facility, investor confidence in Ireland has continued to improve and interest rates on Irish Government bonds are now seen as favourable, as demonstrated by the recent highly successful issue of a €3.75bn new 10-year Irish benchmark bond which attracted in excess of €14bn in orders at a yield of 3.543%. This is an important milestone on Ireland’s recovery and will send a further signal that Ireland is recovering, returning to normal market funding and building for a sustainable future.
160. Deputy Thomas P. Broughan asked the Minister for Finance the total Irish contribution to the European Union budget for the years 2011, 2012 and 2013 and the projected contribution for 2014; if he will report on the total of EU receipts and financial supports during the same periods; and if Ireland is now a net contributor to the European Union. [1677/14]
View answerThe Department of Finance publishes information on EU Budget payments and public sector receiptsin the annual Budget & Economic Statistics (BES) bulletin. The data for 2011 and 2012 are reproduced in the following table. A provisional EU budget payment figure for 2013 and an estimate for 2014 are also included. EU receipts data for 2013 and 2014 are not yet available.
The EU also makes some payments directly to private beneficiaries, most notably for Research programmes, which are not incorporated in the public sector receipts figures. The research receipts published by the EU Commission are included in the table. In overall terms, based on current assumptions, Ireland is likely to remain a net beneficiary under the EU Budget Multiannual Financial Framework in the medium term.
|
Year |
EU Budget Payment |
Public Sector Receipts |
Research Receipts^ |
Total Receipts* |
|
- |
€m |
€m |
€m |
€m |
|
2011 |
1,350 |
1,950 |
72 |
2,023 |
|
2012 |
1,393 |
1,838 |
104 |
1,942 |
|
2013 (p) |
1,726 |
n/a |
n/a |
n/a |
|
2014 (e) |
1,635 |
n/a |
n/a |
n/a |
(p) Provisional(e) Estimate, based upon current information
^Research receipt data is as published by the EU Commission.*Rounding may affect totals.
Sources: Department of Finance, Paying Authorities & EU Commission
161. Deputy Thomas P. Broughan asked the Minister for Finance if he will report on the staffing and other costs of the Irish Fiscal Advisory Council in 2012 and 2013 and the projected costs for the council in 2014. [1678/14]
View answerThe Irish Fiscal Advisory Council was established on a non-statutory basis in July 2011 and established on a statutory basis on the 31 December 2012 under the Fiscal Responsibility Act 2012. The Fiscal Responsibility Act 2012 provides for a ceiling of €800,000 for the Fiscal Council in 2012. This sum is to be adjusted by the annual percentage change in the Harmonised Index of Consumer Prices published by the Central Statistics Office. Accordingly, any expenditure incurred by the Irish Fiscal Advisory Council in the performance of its functions since its establishment on a statutory basis at the beginning of 2013, is charged on and paid out of the Central Fund. In 2012, Fiscal Council costs were €438,301, covering both pay (€228,052) and non-pay (€210,249) expenditure costs. In 2013, the Fiscal Council received a total of €499,939 covering both pay (€244,861) and non-pay (€255,078) related expenditure. To facilitate payments from the Central Fund, the Fiscal Council has provided projected costs for the coming year to my Department. The projected costs for 2014 are €732,020. This sum is broken down as follows; Pay - €384,955 and non-pay - €347,065. The number of staff in the Fiscal Council has increased from 3 in 2012 to 5 in 2014. Under the Fiscal Responsibility Act 2012 the Fiscal Council may appoint such and so many persons to be members of the staff of the Fiscal Council, and on such terms, as may be determined by the Fiscal Council with the prior consent of the Minister given following consultation with the Minister for Public Expenditure and Reform.
The accounts of the Fiscal Council are audited by the Comptroller and Auditor General, who is required to make a report to Dáil Éireann with respect to the correctness of the sums brought to account by the Fiscal Council in the year. The chairperson of the Fiscal Council is required to appear before committees of Dáil Éireann, if invited to do so, to give evidence in relation to the accounts of the Council and the report of the Comptroller and Auditor General.
162. Deputy Thomas P. Broughan asked the Minister for Finance the expenditure incurred in respect of consultants and experts advising his Department in the years 2011, 2012 and 2013; the projected cost of same in 2014 in relation to the European Stability Mechanism and the new European Union banking supervision and support mechanisms in 2013, 2014 and 2015. [1682/14]
View answerMy response is in relation to the Department of Finance only. No such costs have been incurred by my Department in relation to either of these issues to date and there are no budgets allocated for same during 2014 or 2015.
163. Deputy Dominic Hannigan asked the Minister for Finance if he will consider a change to the VAT regime for travel agents based in Ireland who are offering hotel packages online in locations outside of Ireland to enable them to compete with travel agents who operate in countries with low or no VAT rates for hotel accommodation in order that they can compete on an equal footing with travel agents who do not have to legally charge VAT on their offers and are at a competitive advantage because of same; and if he will make a statement on the matter. [1688/14]
View answerI am advised by the Revenue Commissioners that provisions covering the Travel Agents Margin Scheme are contained in Section 88 of the VAT Consolidation Act 2010. This scheme, which is provided for in Articles 306 to 310 of the EU VAT Directive, with which Irish VAT law must comply, was introduced with effect from 1 January 2010. Detailed discussions with the travel industry were carried out prior to the introduction of the scheme. The scheme deals with the activities carried on by travel agents who act in the capacity of a principal when supplying certain travel services such as transport, accommodation, etc, which they have bought in from third parties for onward supply to travellers.
Travel agents covered by the scheme are liable to VAT on their supply of certain services, not in respect of the consideration they receive for such services but in respect of the travel agents margin on those services. The nature of the scheme means that the travel agent only has an obligation to account for VAT on the margin in the country where he is established. VAT rates are not harmonised across EU Member States so the rate at which the margin is chargeable to VAT may vary from country to country. In Ireland, the margin apportioned to travel activities located in the EU is liable at the standard rate, currently 23%. Where the travel activities are located in non-EU destinations, such supplies are subject to the zero rate of VAT.
The EU VAT Directive provides that Member States that had been applying a zero rate or a reduced rate to certain goods or services on 1 January 1991 may continue to apply those rates after that date but not to extend their scope. In general, each Member State defined in its national legislation the goods and services to which rates lower than the standard rate applied. There is no legislative basis for Ireland to apply a reduced rate to travel activities located in the EU. Changes to the EU-wide travel agents scheme can only be made following agreement with all Member States.
164. Deputy Pearse Doherty asked the Minister for Finance if he has discussed or plans to discuss with the Central Bank the legal basis by which the Central Bank allows commercial banks to drop prudence and overvalue loans in their published accounts and the problems that such a policy has created. [1712/14]
View answerThe Irish banks’ financial statements are prepared in accordance with International Accounting Standards and International Financial Reporting Standards as adopted by the European Union. The requirement for commercial banks to prepare financial statements is laid out in the Companies Acts, 1963 – 2013. The Central Bank of Ireland has informed me that it has no role in the enforcement of the Companies Acts. The Central Bank supervises banks through a combination of the review of financial statement information and prudential reporting requirements.
I do not accept the premise of the question that Irish banks have systemically overvalued loans in their published accounts. However the Deputy will be aware that the Companies Acts come under the aegis of my colleague, the Minister for Enterprise, Trade and Innovation. The Director of Corporate Enforcement has widespread powers and functions in relation to potential breaches of the Companies Acts.
165. Deputy Willie Penrose asked the Minister for Finance in the context of the recent taxation changes to the one-parent family credit under the tax code, the criteria by which same can be claimed; if there is provision for same to be allocated to two people who are providing the necessary care for a child; and if he will make a statement on the matter. [1803/14]
View answerAs you are aware the One-Parent Family Tax Credit (OPFTC) has been replaced with a new Single Person Child Carer Tax Credit from 1 January 2014. The restructured credit is of the same value i.e. €1,650 per annum as the OPFTC and also carries the same entitlement to the additional €4,000 extended standard rate band, which increases it to €36,800 per annum, before liability to the higher rate of income tax arises. However, the credit will be more targeted, in that it will in the first instance, only be available to the principal carer of the child.
The credit is not apportioned where more than one person is involved in the care of the qualifying child. Where, for whatever reason, a primary claimant does not wish to, or cannot avail of the credit, (for example, where the primary claimant has no tax liability), and chooses to surrender it, a secondary claimant may make a claim for the credit, provided that the qualifying child resides with him or her for not less than 100 days in the tax year. A secondary claimant cannot make a claim unless a primary claimant is entitled to the credit in the first instance and surrenders it.
A claim cannot automatically transfer to a secondary claimant without the primary claimant first surrendering it and the secondary claimant making a claim for it. However, once the secondary claimant has been granted the credit, he or she will retain it for that tax year and subsequent tax years unless the credit is reclaimed again by the primary claimant, or the secondary claimant ceases to meet the qualifying conditions. The secondary claimant cannot be married, in a civil partnership or cohabiting.
If the primary claimant wishes to subsequently reinstate his or her claim to the Single Person Child Carer Credit he or she must make a claim for the credit to the Revenue office. In such circumstances the credit will only be reinstated from the start of the next tax year. Further details in relation to the Single Person Child Carer Credit and the relevant forms, including those for relinquishment by a primary claimant and claim by a secondary claimant, may be found on the Revenue website at http://www.revenue.ie/en/tax/it/credits/single-person-child-carer-credit.html.
