Tuesday, 4 Mar 2014

Written Answers Nos. 23-41

Tax Code

Questions (23)

Jack Wall

Question:

23. Deputy Jack Wall asked the Minister for Finance if a person (details supplied) in County Kildare should be exempt from tax; and if he will make a statement on the matter. [10208/14]

Written answers

Minister for Finance

I have been advised by the Revenue Commissioners that a tax credit certificate issued to the person concerned on the 8th January 2014.  This certificate was based on the information available to Revenue at that time.  

Taking into account the additional information received on the income and circumstances of the person concerned and his spouse, the Revenue Commissioners can confirm that they are not liable to income tax. Based on the additional information received amended tax credit certificates will issue shortly to the person concerned and his spouse. On the basis of these amended certificates no tax is payable by either individual.  

The employer of the person concerned will be notified of the revised tax credits. A refund of the tax paid to date in 2014 will be made by the employer through the payroll.

Universal Social Charge Exemptions

Questions (24)

Dan Neville

Question:

24. Deputy Dan Neville asked the Minister for Finance the position regarding the universal social charge in respect of a person (details supplied) in County Limerick; and if he will make a statement on the matter. [10260/14]

Written answers

Minister for Finance

I am advised by the Revenue Commissioners that a medical card does not in itself exempt a taxpayer from USC although it may reduce the applicable rate.  The taxpayer is exempt from USC only if her gross income for the tax year 2014 is less than €10,036. Income for this purpose does not include payments from Dept. of Social Protection, and it appears from the information supplied that this taxpayer may be exempt.  

If the taxpayer's gross income is likely to be less than €10,036 for the current tax year she should submit evidence of her gross income, such as a letter from her employer, to her local tax office. An amended Tax Credit Certificate, granting exemption from USC, can then be issued to her employer.  On the basis of the information supplied Revenue will initiate a review of previous years where her income may have been below the limit.

Universal Social Charge Application

Questions (25)

Terence Flanagan

Question:

25. Deputy Terence Flanagan asked the Minister for Finance the position regarding the payment of the universal social charge (details supplied) in Dublin 9; and if he will make a statement on the matter. [10373/14]

Written answers

Minister for Finance

The Universal Social Charge (USC) was introduced in Budget 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. It is a more sustainable charge than those it replaced.  It is applied at a low rate on a wide base.  The revenues collected play a vital part in meeting the many expenditure demands placed on the Exchequer.

As you may be aware, delivering on a commitment in the Programme for Government, the USC was reviewed by the Department of Finance in the lead up to Budget 2012. The report is available at;

 www.finance.gov.ie

 As a result of the review of the USC, the Government decided in Budget 2012 to increase the entry point to the Universal Social Charge from €4,004 to €10,036 per annum. It is estimated that this removed almost 330,000 individuals from the charge.  

It should be acknowledged that Ireland has a progressive taxation system which ensures that the burden of taxation falls most heavily on those with a higher ability to pay. The latest data from the OECD's 2013 Tax Wages Report shows that Ireland has one of the most progressive income tax systems in the developed world. Currently it is estimated that 856,000 workers are excluded from the charge to income tax entirely.

In keeping with normal practice I have no intention of setting out planned changes to the tax system in advance of the Budget, which is almost eight months away. However, as is also normal practice, my officials will model and examine potential options for changes to the tax system for my consideration as part of the overall Budget package.  

IBRC Mortgage Loan Book

Questions (26)

Dominic Hannigan

Question:

26. Deputy Dominic Hannigan asked the Minister for Finance the steps he will take to make sure the buyer of the Irish Bank Resolution Corporation mortgages complies with the Central Bank of Ireland code of conduct on mortgages; and if he will make a statement on the matter. [10381/14]

Written answers

Minister for Finance

I am aware of the concerns of some borrowers about sale of the mortgage books to funds that are not covered by the Code of Conduct on Mortgage Arrears, or CCMA.  I have instructed my Department to examine the issue, in consultation with the Central Bank, with a view to bringing forward a solution, if required. Given this is a complex legal issue, it requires careful consideration so as not to put at risk the general applicability of the CCMA.

I welcome the voluntary agreement which has been reached between the Special Liquidators of IBRC and the bidders for the IBRC mortgage book in relation to the application of the Code of Conduct on Mortgage Arrears.  This is an important and timely development and will ensure that mortgage holders in arrears will be serviced in line with the CCMA and the customers will continue to be protected by the code. I would also add that in the event that NAMA are to acquire the book they too have indicated that customers will be in no worse a position than had they remained with IBRC.  

The issue will be considered at Private Members Business today and I have accepted the principle of the Fianna Fail Bill proposed by Deputy McGrath.  

Property Tax Collection

Questions (27)

Terence Flanagan

Question:

27. Deputy Terence Flanagan asked the Minister for Finance the reason a person must pay additional costs when paying taxes by instalments; and if he will make a statement on the matter. [10405/14]

Written answers

Minister for Finance

I am advised by Revenue that it does not charge any additional costs where a liable person opts to pay Local Property Tax (LPT) through phased payment arrangements (instalments). Phased payments by deduction at source from salary, occupational pension or certain Government payments are entirely free of charge.  However, certain LPT payment options including, credit card, direct debit and cash payment through service providers are provided by either financial institutions or commercial entities and are subject to transaction fees. Revenue has no role in regard to the setting of these fees nor does it profit in any way from their payment.

For the Deputy's information, there are currently eight separate payment options available for LPT including,

- Single Debit Authority, which operates like an electronic cheque. This option is activated by completing the payslip on the LPT Return and will not be deducted from bank accounts by Revenue any earlier than 21 March 2014 in respect of the 2014 LPT liability

- Debit/Credit cards.

- Cheque/Bank Draft/Postal Order.

- Cash payments (including debit/credit cards) through Revenue approved Payment Service Providers.

- Phased cash payment arrangements (including debit/credit cards) through Revenue approved Payment Service Providers.

- Deduction at source from salary or occupational pension.

- Deduction at source from certain payments received from the Department of Social Protection and from payments received from the Department of Agriculture, Food & Marine.

- Direct Debit, which is deducted on the 15th day of each month over the course of the year. 

 In regard to the cash payment option, the approved payment service providers are An Post TaxPay, Payzone and Omnivend.  These service providers were approved because they have extensive nationwide outlets and are easily accessible right across the country. They provide liable persons with the facility to pay LPT in full or on a phased weekly/monthly basis as best suits individual circumstances. I understand that currently, An Post charges €1 per transaction; Payzone charges 75 cents per transaction for payments up to €50, €1 per transaction for payments between €50.01 and €100 and €2 per transaction for payments over €100; and Omnivend charges a fee of 4% per transaction.

In regard to the specific case to which the Deputy refers, the person in question opted to meet his LPT liabilities through one of these approved service providers and on that basis is liable to the transaction charges as outlined. I must again stress that Revenue has no role in the imposition of these charges.

Again for the Deputy's information, Revenue has confirmed to me that the 'deduction at source' options as outlined above do not incur any transaction fees or additional costs and deduct the LPT liability in phased amounts across the course of the year. If the person in question is interested in changing his preferred payment option to deduction at source, he can do so online by using his Property ID and PI number to access his details or he can contact the LPT Helpline at 1890 200255.

Property Tax Collection

Questions (28)

Barry Cowen

Question:

28. Deputy Barry Cowen asked the Minister for Finance if he will provide in tabular form a county breakdown of the estimated local property tax income in 2014; the total collected in 2013 combined with compliance rates to date; and if he will make a statement on the matter. [10420/14]

Written answers

Minister for Finance

I am informed by the Revenue Commissioners that compliance data in relation to the Local Property Tax (LPT) is available broken down by city and county councils nationally. The most up to date figures for 2013 and 2014, which were published on 18 February 2014, are available on the Commissioners website at: http://www.revenue.ie/en/tax/lpt/lpt-stats-0214.pdf.  

While the 2014 forecasted yield for LPT nationally is €550 million, the Commissioners advise that it is not possible to state the precise amount of LPT which is expected to be collected for each City and County Council in 2014. A number of factors could affect the outcome, including the continuation of the strong level of voluntary compliance that was achieved in 2013, the impact of Revenue s compliance programme to follow up with those liable persons who have failed to meet their LPT obligations for 2013 and 2014, and the compliance programme for the collection of arrears of household charge/LPT.  

The Commissioners have confirmed that by the end of December 2013 €318m had been transferred by Revenue to the Exchequer in respect of LPT. Of this amount, €242m was in respect of LPT for 2013 and €76m relates to 2014 LPT. By the end of January 2014, a further €32.6m was transferred by Revenue to the Exchequer.

Property Tax Application

Questions (29)

Brendan Ryan

Question:

29. Deputy Brendan Ryan asked the Minister for Finance if he will provide an update on the recommendation of the Thornhill Group for local property tax paid in respect of a rented property to be tax deductible in a similar manner to commercial rates; when this recommendation is likely to be implemented; and if he will make a statement on the matter. [10421/14]

Written answers

Minister for Finance

As I have indicated on many previous occasions, the Government has in principle accepted the recommendation of the Thornhill Group (that the Local Property Tax paid in respect of a rented property should be deductible for income tax or corporation tax purposes, in a similar manner to commercial rates)  but has not considered the manner or the timing in which this will happen. Any such change would have to be provided for by primary legislation.   

Allowing LPT as a deductible expense would, in all likelihood, reduce the yield from the tax. In making decisions in this regard, regard will have to be had to the net impact on the public finances given the significant current budgetary constraints.

IBRC Loans

Questions (30)

Brendan Ryan

Question:

30. Deputy Brendan Ryan asked the Minister for Finance if further consideration will be given to offering discounts to persons who have individual loans with the former Irish Bank Resolution Corporation; if this can be done without conflicting with the previously stated need by his Department to protect commercially sensitive information for bulk loan sales; if he will examine the possibility of recommending this to the special liquidators for IBRC; and if he will make a statement on the matter. [10422/14]

Written answers

Minister for Finance

There is an obligation on the Special Liquidators to ensure that maximum value is extracted from the loan sales process for the benefit of all the creditors of IBRC including the State.

The Special Liquidators appointed PwC as independent advisors to value the residential mortgage portfolio. PwC were also appointed to provide independent advice in developing a robust and credible sales strategy for the sale of the residential mortgage portfolio. Following the representations received from borrowers and the independent advice provided by PwC, the Special Liquidators decided that the residential mortgage portfolio be sub-divided into four portfolio tranches with a view to maximising market interest and return within the timelines set out in the Ministerial Instructions. I am informed by the Special Liquidators that they are confident that this process will deliver the maximum value from the sale of the residential mortgage portfolio and thus maximise the return for the creditors of IBRC.

I have been advised by the Special Liquidators that they did consider the concept of offering individual mortgages for sale.  A number of issues impacted on this decision including cost, timing, independent professional advice received, the impact of borrower only bids, the confidentiality of personal information, execution risk and delivering the best results for creditors of the bank.

It is not possible for me to interfere in the sales process developed by the Special Liquidators as to do so could leave me open to challenge by other creditors of the bank.

NAMA Operations

Questions (31)

Kevin Humphreys

Question:

31. Deputy Kevin Humphreys asked the Minister for Finance further to Parliamentary Question No. 82 of 19 February 2014, the price that National Assets Management Agency realised for the site of five acres on the Merrion Road beside Booterstown Nature Reserve when it sold it in March 2012, and what was the value of the underlying loan on the property at the time; and if he will make a statement on the matter. [10424/14]

Written answers

Minister for Finance

I refer the Deputy to my response 82 of 19th February 2014.  As Minister for Finance, I have no role in relation to the day-to-day detail of NAMA's strategy.  However, to be helpful, I outlined that the asset was sold by the appointed receiver after being openly marketed.  A receiver has a legal obligation to the debtor to obtain the best possible price for any secured asset he or she sells. The marketing campaign included advertisements in the national press and generated significant interest from prospective purchasers.  I am advised that the relevant local authorities were afforded an opportunity at the completion of the sales process to, in line with NAMA Board guidelines, match the highest offer received, however they chose not to do so.   

It would not be appropriate for me to comment further on this transaction which was undertaken by a receiver. 

Economic Data

Questions (32)

Brendan Ryan

Question:

32. Deputy Brendan Ryan asked the Minister for Finance if his Department has records of the performance of Irish companies in terms of net profit or net loss for the purposes of measuring or indicating economic performance; and if he will make a statement on the matter. [10510/14]

Written answers

Minister for Finance

My Department does not maintain records of Irish companies for the purpose of assessing economic developments.

The Central Statistics Office is responsible for inter alia measuring economic performance and compiles data from Irish-based companies to do this.

My Department assesses these economic data with a view to inter alia projecting forward likely trends in the economy.

Revenue Commissioners Investigations

Questions (33)

Charlie McConalogue

Question:

33. Deputy Charlie McConalogue asked the Minister for Finance when a Revenue Commissioner's investigation is expected to be resolved in respect of a person (details supplied) in County Donegal; and if he will make a statement on the matter. [10568/14]

Written answers

Minister for Finance

I am advised by the Revenue Commissioners that the Donegal District office has been made aware by an employee of a dispute between him and a former employer in regard to the amount of wages recorded on his P60 as having been paid to him for a particular tax year. The nature of the dispute appears to be one which, in the normal course would be resolved between the parties.  However, in this instance Revenue is in contact with the person referred to by the Deputy in his question, with a view to assisting him in relation to his student grant.

All taxpayer information held by the Revenue Commissioners is confidential and may only be disclosed in accordance with Section 851A, Taxes Consolidation Act, 1997 or as is otherwise provided for by any other statutory provision. In this instance, the Revenue Commissioners will not be in a position to disclose to any other party any information in regard to the tax affairs of the former employer.

National Treasury Management Agency Deposits

Questions (34)

Brendan Griffin

Question:

34. Deputy Brendan Griffin asked the Minister for Finance further to Parliamentary Question No. 201 of 28 January 2014, the reason maturity options forms for saving certificates in respect of a person (details supplied) in County Kerry have not been provided for periods and have been provided for future maturity options; and if he will make a statement on the matter. [10582/14]

Written answers

Minister for Finance

I am informed by the National Treasury Management Agency (NTMA) that the maturity notices in question were despatched to the registered address of the person but were returned undelivered.  Arrangements are being made to have the notices reissued to the person. It is understood that postal deliveries to the person's home are dependent on the customer being present to accept delivery of mail as there is no letter box on the premises.

Tobacco Smuggling

Questions (35)

Seán Kenny

Question:

35. Deputy Seán Kenny asked the Minister for Finance the number of persons prosecuted for cigarette and tobacco smuggling in Dublin Port and Dublin Airport in 2012 and 2013; and if he will make a statement on the matter. [10595/14]

Written answers

Minister for Finance

I am advised by the Revenue Commissioners that, during 2012-2013, 70 prosecutions resulting in convictions for tobacco smuggling arose from detections made at Dublin Airport, and 1 prosecution leading to conviction for that offence related to a detection made at Dublin Port.  A number of other prosecutions relating to alleged smuggling detected at those locations in the period in question are before the Courts at present and files are being prepared, with a view to prosecution, in others.  

Property Tax Administration

Questions (36)

Dan Neville

Question:

36. Deputy Dan Neville asked the Minister for Finance his views on correspondence (details supplied) regarding the local property tax. [10623/14]

Written answers

Minister for Finance

I am advised by Revenue that a key aspect of the work undertaken in regard to Local Property Tax (LPT) was the development of a comprehensive Register of residential properties in the State. The Register was populated using data drawn from a range of sources including Revenue's own databases, the Local Government Management Agency database and data from various utility companies. The various data sets were cross-checked by Revenue to ensure the accuracy of the information in respect of each property being included on the Property Register.  

However, given the scale of the project it was inevitable that there would be some errors and in a small number of instances properties were either duplicated to, or omitted from, the Property Register. Revenue clearly indicated this possibility in all of its communications in regard to LPT and stressed that in such circumstances the onus was on the property owners to make contact and provide the correct details.  

In regard to the specific case to which the Deputy refers, the person in question did not receive any notification in respect of either 2013 or 2014 from Revenue as the details on the Property Register did not reflect the correct postal address. A member of the LPT team recently made direct contact with the person in question and assisted him in correcting his contact details, filing his 2013 Return and arranging his payment obligations in respect of both 2013 and 2014. Revenue has confirmed to me that the person s details are now correctly detailed on the Property Register and that his LPT Return filing obligations are fully in order. The person confirmed to the LPT team member that he would be paying his outstanding liabilities in the coming days by cheque. Revenue has assured me that once the payment is received the person will be fully LPT compliant.

Mortgage Interest Relief Eligibility

Questions (37)

Michael McGrath

Question:

37. Deputy Michael McGrath asked the Minister for Finance if he will address an issue raised in correspondence by a person (details supplied) in Dublin 22 regarding tax relief at source; and if he will make a statement on the matter. [10633/14]

Written answers

Minister for Finance

The situation is that tax relief in respect of mortgage interest paid is available at a number of varying rates and is subject to certain ceilings as provided for in Section 244 of the TCA 1997.

The relief is available up to and including the tax year 2017 on qualifying home loans taken out on or after 1 January 2004 and on or before 31 December 2012.

Individuals purchasing their first qualifying residence within the specified date range are eligible for the higher ceiling, known as the 'first time buyer ceiling', for the first seven tax years of entitlement to mortgage interest relief. The maximum amount of interest paid in respect of this ceiling for which tax relief can be claimed is €20,000 for married/widowed persons and €10,000 for single persons.

For tax year eight and subsequent tax years, the applicable ceiling changes to the reduced 'non-first time buyer ceiling', which applies at maximum rates of €6,000 for married/widowed persons and €3,000 for single persons.

In regard to the specific case to which the Deputy refers, Revenue has confirmed to me that the persons in question were assigned 'first time buyer' status with effect from 1 January 2007, which entitled them to the higher ceiling relief until 31 December 2013 inclusive. In accordance with the legislation, their entitlement to the higher relief expired with effect from 1 January 2014 at which point they became entitled to the lower 'non-first time buyer' ceiling.

I appreciate and very much sympathise with the position of people who are experiencing genuine difficulty in meeting their mortgage payments, particularly those who purchased their homes at the height of the property boom between 2004 and 2008.  In this regard, in Budget 2012, I fulfilled the commitment in the Programme for Government to increase the rate of mortgage interest relief to 30 per cent for first time buyers who took out their first mortgage in that period. In the absence of this change mortgage interest relief rate would have reduced to 15% resulting in maximum relief of €450 per annum.

However, given that mortgage interest relief has now been abolished for mortgages taken out since 1st January 2013, I do not propose to revisit the legislation with a view to introducing further changes.

Banking Sector

Questions (38)

Michael McGrath

Question:

38. Deputy Michael McGrath asked the Minister for Finance when the European Commission will deliver its final response and decision in respect of the restructuring proposals for AIB; and if he will make a statement on the matter. [10640/14]

Written answers

Minister for Finance

As the Deputy will be aware, AIB through the Department of Finance, has been in detailed discussions with the European Commission to finalise the terms of the bank's EU Restructuring Plan.  Finalisation and approval of this plan is an important milestone for the bank as it returns to profitability and re-engages with its customers and the funding and investment markets.  Based on the interaction my officials have had with the EC case team in Brussels, I expect that the Plan will be approved in the short term.

Corporation Tax

Questions (39)

Michael McGrath

Question:

39. Deputy Michael McGrath asked the Minister for Finance if he will specify the information that has been requested by the European Commission and the information that has been provided by the Department of Finance and the Revenue Commissioners in relation to the ongoing preliminary review by the European Commission regarding Ireland's treatment of certain multinational companies for corporation tax purposes; the number of multinational companies operating here in respect of whom information has been sought by the European authorities; if the companies concerned have been formally notified that information pertaining to them has been supplied to the European Commission; and if he will make a statement on the matter. [10642/14]

Written answers

Minister for Finance

As the Deputy is aware, the Competition Directorate of the European Commission is currently conducting a review of corporate tax ruling procedures in various EU Member States in order to assess such practice under EU State Aid rules.  

What is involved at this stage is a preliminary gathering and examination of information on the part of the Commission for the purposes of getting an overview of the different tax ruling procedures in various Member States. I should add that this is not a formal EU State Aid investigation nor is it an enquiry that is specific to any one Member State.  

Ireland is fully co-operating with the Commission in this exercise. The Commission has requested information on Revenue s administrative practice in relation to the provision of advance opinions, as well as details of the type of opinions provided to companies. Revenue has provided the information sought by the Commission as required under EU law.  

As the communication with the Commission are part of a confidential process which is at a preliminary stage, I am not in a position to give details on what has been provided, other than to say that it includes general information on Revenue's administrative procedures and practice in providing advance opinions, as well as specific details in relation to advance opinions provided to individual companies.  

Individual companies have not been notified, but this position will be kept under review and, when and where necessary, companies may be notified as appropriate.   

Credit Unions

Questions (40, 41)

Ciara Conway

Question:

40. Deputy Ciara Conway asked the Minister for Finance if he will confirm that credit unions must hold a yearly annual general meeting; if it is within the remit of the registrar of credit unions to refuse credit union members an AGM; and if he will make a statement on the matter. [10647/14]

Ciara Conway

Question:

41. Deputy Ciara Conway asked the Minister for Finance in the case of a credit union (details supplied) in County Waterford, if his attention has been drawn to the fact that shareholders have been refused an annual general meeting for more than two years; the measures that can be used to appeal such an decision; and if he will make a statement on the matter. [10648/14]

Written answers

Minister for Finance

I propose to take Questions Nos. 40 and 41 together.

The Registrar of Credit Unions at the Central Bank is responsible for the regulation of credit unions.

Credit unions are required to hold an Annual General Meeting (AGM), in accordance with Section 78(2) of the Credit Union Act 1997, within four months of the end of the financial year, which is 30 September.  The Central Bank works closely with credit unions on a case by case basis to resolve any regulatory issues arising prior to the holding of an AGM.  In some cases AGMs may be deferred by way of the Central Bank advising the credit union concerned that specified regulatory matters in relation to the finalisation of the annual accounts must be resolved.  Under section 78(4) of the Credit Union 1997 the Central Bank may also direct a credit union to postpone, for a period not exceeding nine months, the holding of the annual general meeting of a credit union; these directions are not appealable.  I am advised by the Central Bank that any actions by it are taken in the interest of credit union members and the protection of their savings, in line with the Bank's statutory mandate.   

Where members are seeking information regarding the proposed timing of their AGM, they should request this information from their credit union.