Written Answers Nos. 158 - 179
158. Deputy Brian Walsh asked the Minister for Finance when the Revenue Commissioners last issued an auctioneer's licence in respect of a person (details supplied) in County Galway; if it is possible to obtain a copy of same; and if he will make a statement on the matter. [27239/14]
View answerI am advised by the Revenue Commissioners that their Galway Office has been in touch with the Deputy regarding this Parliamentary Question. It is understood that the person in question (details supplied) held an auctioneer's licence approximately 10 - 15 years ago but is unable to provide further details in relation to his last licence. In the circumstances, the Revenue Commissioners are unable to provide the information in the time available as historical archives have to be searched. However, Revenue will write directly to the person as soon as they have completed a search of their archives.
159. Deputy Gerald Nash asked the Minister for Finance his plans to expand the living cities initiative in 2015; if he will consider including Drogheda, County Louth, in any such expansion; and if he will make a statement on the matter. [27273/14]
View answerThe Deputy will be aware that I announced in my most recent Budget Statement that the Living City Initiative, which was enacted in the Finance Act 2013, would be extended to now include the cities of Dublin, Cork, Galway and Kilkenny as well the original target cities of Limerick and Waterford. The inclusion of these four cities within the Initiative followed the results of a thorough independent ex ante cost benefit analysis.
The Initiative will target certain areas of these six cities, particularly those areas which are most in need of regeneration. Those designated areas will be decided upon following consultations with the relevant local authorities and other Government agencies. It is important to note that I do not see this as a wide-spread Initiative, as it is targeted at those areas which are most in need of attention. Therefore I do not intend to extend the Initiative further than these 6 cities.
160. Deputy Anne Ferris asked the Minister for Finance in view of recent good weather and the calls from the Irish Cancer Society for people to wear sun protective creams, if he will consider reducing the VAT rate on these products as they attract the luxury VAT rate of 23%; and if he will make a statement on the matter. [27274/14]
View answerI am advised by the Revenue Commissioners that 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 (Council Directive 2006/112/EC) generally provides that supplies of goods and services be chargeable to VAT at the standard rate but that lower rates are permitted in very limited circumstances. There is no scope for a reduction in the rate of VAT on sun protective creams that would be in compliance with the EU VAT Directive.
161. Deputy Thomas P. Broughan asked the Minister for Finance the amount of revenue that would be generated in each case if a third rate of income tax of 48%, 49% or 50% was applied to persons earning over €100,000 in budget 2015. [27301/14]
View answer165. Deputy Thomas P. Broughan asked the Minister for Finance the cost to the Exchequer of increasing the PAYE tax credit by €5 per week and €10 per week respectively. [27305/14]
View answerI propose to take Questions Nos. 161 and 165 together.
It is assumed that the threshold for the proposed new income tax rates mentioned by the Deputy in Question 27301/14 would not alter the existing standard rate band structure applying to single and widowed persons, to lone parents, married couples and civil partnerships.
I am advised by the Revenue Commissioners that, given the current band structures, major issues would need to be resolved as to how in practice such a new rate could be integrated into the current system and how this would affect the relative position of different types of income earners. Notwithstanding these issues, I am advised by the Commissioners that the full year yield to the Exchequer, estimated by reference to 2014 incomes, of the introduction of the suggested new third rate of Income Tax of 48%, 49% or 50% would be of the order of €380 million, €435 million and €489 million respectively.
In relation to Question 27305/14, I am further advised by the Revenue Commissioners that the full year cost to the Exchequer, estimated by reference to 2014 incomes, of increasing the employee (PAYE) tax credit in the manner mentioned by the Deputy would be of the order of €332 million and €644 million respectively.
These figures are estimates from the Revenue tax forecasting model using latest actual data for the year 2011, adjusted as necessary for income self-employment and employment trends in the interim. They are provisional and may be revised. Married persons or civil partners who have elected or have been deemed to have elected for joint assessment are counted as one tax unit.
162. Deputy Thomas P. Broughan asked the Minister for Finance the amount of revenue generated by the domicile levy in the years 2010 to date in 2014, inclusive; and the measures being taken by the Revenue Commissioners to increase compliance with the measure. [27302/14]
View answerI am informed by the Revenue Commissioners that the figures for the domicile levy are per the following table. This is the amount of tax collected in each of the years specified. Although the domicile levy was introduced in 2010, the first returns and payment were not due to be filed and paid until 2011 hence there are no payments in 2010. There are no payments to date in 2014 as the 2013 returns are not due to be filed and paid until October 2014 and no payments in respect of previous years have been received to date.
|
Year |
Tax collected in each year |
|
2010 |
Nil |
|
2011 |
€1,479,813 |
|
2012 |
€2,767,737 |
|
2013 |
€2,068,813 |
|
2014 |
Nil |
|
Total |
€6,316,363 |
I am further informed by the Revenue Commissioners that there is an on-going compliance programme in relation to individuals who appear to meet the criteria in relation to the domicile levy for the years 2010 to 2013. The purpose of the compliance program is to determine whether these individuals meet all the criteria in relation to the levy and to quantify and collect any outstanding domicile levy liability that might be due for back years. These enquiries are being conducted on a number of levels, including full audit.
163. Deputy Thomas P. Broughan asked the Minister for Finance his proposals to address the problem of the so-called step effect in the PRSI system affecting lower income workers whereby persons earning gross pay of between €18,305 and €19,366 per annum are paying a much higher effective tax rate than those earning below €18,304 per annum; and the potential cost of redressing the unfairness created by this element of the PRSI system. [27303/14]
View answerI assume the Deputy is referring to the recent TASC report regarding the step effect in the PRSI system which brings all income into charge once the relevant threshold is reached. While such an effect is never ideal, it is necessary to achieve the desired yield, which in itself contributes to keeping workers on incomes lower than the threshold to remain outside the charge to employee PRSI entirely. However it should be noted that the cohort identified being affected by this step effect do not ordinarily pay income tax on the first €16,500 of their income because of the PAYE and personal tax credits, and in some cases, depending on eligibility for additional credits, they may be exempt from the income tax charge entirely.
The potential cost of addressing this step effect must be viewed in the context of the constrained fiscal environment in which we find ourselves. Under the terms of the Stability and Growth Pact, until Ireland has reached its objective of a balanced budget in structural terms, we may not introduce discretionary revenue reductions unless they are matched by other revenue increases or expenditure reductions. This means that Government must consider carefully any tax changes as any reductions will have to be offset elsewhere.
164. Deputy Thomas P. Broughan asked the Minister for Finance the projected yield that could be generated by introducing minimum effective rates of corporation tax of 7.5%, 9% and 10%. [27304/14]
View answerIt is important to clarify at the outset that there are two separate scenarios that are often confused in discussions on the effective rate of corporation tax. The first is the global rate of tax which is paid by multinational companies who operate across a number of jurisdictions. This is a 'blended' rate which takes into account the amount of tax charged across all of the countries that a company trades in and not just Ireland.
The extremely low effective rate figures are sometimes quoted and attributed to Ireland are based on a flawed premise. The figures are estimated by dividing the amount of Irish tax paid by a total profit figure that includes substantial profits made by companies that are not tax resident in Ireland. They are running together the profits earned by group companies in Ireland and in other jurisdictions and incorrectly suggesting that Irish tax does or should apply to both. Ireland cannot tax profits that are properly attributable to other jurisdictions.
The ability of some multinationals to lower their world-wide rate of tax using international structures reflects the global context in which Ireland and indeed all countries operate. The best way to effectively address this issue is for countries to work together at the international level and the appropriate action is being considered in this regard by the OECD as part of their project on Base Erosion and Profit Shifting and Ireland is participating fully in this process.
The second issue is the effective rate of tax applying in individual countries. Clearly, the domestic rate of tax paid in Ireland is within the control of the Irish tax system and Ireland is responsible for the amount of Irish corporation tax that is charged here. I want to re-emphasise that all companies operating in Ireland - domestic businesses and multinationals - are chargeable to corporation tax at the 12.5% rate on the profits that are generated from their trading activities here. A higher 25% rate applies in respect of investment, rental and other non-trading profits, as well as certain petroleum, mining and land-dealing activities, and chargeable capital gains are taxable at the capital gains tax rate of 33%.
Some other countries have a high headline rate of corporation which is then supplemented by a high number of tax reliefs which reduce the overall rate of tax paid. By contrast, the approach in Ireland is transparent: we have a competitive headline rate of corporation tax which is applied to a broad base. We therefore have only a small number of corporation tax incentives in Ireland, and we make sure that those we do have are specifically targeted. They are focussed on the creation of employment and on areas of innovation. These reliefs are evaluated on a regular basis to ensure that they give the taxpayer value for money.
My Department recently published a technical paper to provide clarity to the Dáil about the seemingly conflicting figures and methodologies. The Department commissioned an external and independent academic to ensure that this piece of work was as objective as possible. This report is published on the Department's website and can be viewed at the following link:
http://www.finance.gov.ie/sites/default/files/140407%20FINAL%20Technical%20Paper%20on%20Effective%20Rates%20of%20Corporation%20Tax%20in%20Ireland.pdf.
Based on data from the Central Statistics Office (using the "Net Operating Surplus") and the Revenue Commissioners (using the "Taxable Income"), this report highlighted that since 2003 the effective corporate tax rate has averaged 10.9% and 10.7% respectively. While this percentage is lower than the 12.5% headline rate, this can be attributed to the availability of the small number of reliefs I referred to earlier such as the R&D tax credit, which was the subject of a comprehensive review last year and which was found to give value for money for the Irish taxpayer.
Therefore, I am not in a position to introduce a minimum 'effective rate' in Ireland in the way the Deputy has suggested.
166. Deputy Thomas P. Broughan asked the Minister for Finance his views on the proposal in a submission (details supplied) to make tax credits refundable; and the projected cost to the Exchequer of establishing the necessary administrative system to facilitate the refund of tax credits. [27306/14]
View answerThe Deputy is advised that the Advisory Group on Tax and Social Welfare (AGTSW) are considering a range of tax and social welfare issues, with a view to increasing the incentives for individuals to return to work. I understand that one of the issues the Group have examined relates to refundable tax credits. It is expected that the Group will publish its report later this summer and I anticipate its recommendations will be a useful addition towards informing upcoming budgetary deliberations.
Without any new policy decision or direction on this issue, Revenue has not undertaken any estimate of the projected cost to the Exchequer of establishing the necessary administrative system to facilitate the refund of tax credits. However, it should be borne in mind that under the terms of the Stability and Growth Pact, until Ireland has reached its objective of a balanced budget in structural terms, we may not introduce discretionary revenue reductions unless they are matched by other revenue increases or expenditure reductions. This means that Government must consider carefully any tax changes as any reductions will have to be offset elsewhere.
167. Deputy Kevin Humphreys asked the Minister for Finance of the residential mortgage loan accounts in the principal dwelling home and buy-to-let sector respectively in arrears of up to 90 days, as provided to the Central Bank of Ireland for its quarterly report, if he will provide in tabular form the number of these loans broken down by the value of the outstanding balance as defined in the Central Bank of Ireland statistics as follows: balances outstanding below €250,000, between €250,001 and €500,000, between €500,001 and €750,000, between €750,001 and €1 million; the number of those with a balance outstanding of more than €1 million respectively in arrears of up to 90 days; if he will provide details of the numbers by institution; and if he will make a statement on the matter. [27309/14]
View answer168. Deputy Kevin Humphreys asked the Minister for Finance of the residential mortgage loan accounts in the principal dwelling home and buy-to-let sector respectively in arrears of between 91 to 180 days, as provided to the Central Bank of Ireland for its quarterly report, if he will provide in tabular form the number of these loans broken down by the value of the outstanding balance as defined in the Central Bank of Ireland statistics as follows: balances outstanding below €250,000, between €250,001 and €500,000, between €500,001 and €750,000, between €750,001 and €1 million; the number of those with a balance outstanding of more than €1 million respectively in arrears of between 91 and 180 days; if he will provide details of the numbers by institution; and if he will make a statement on the matter. [27310/14]
View answer169. Deputy Kevin Humphreys asked the Minister for Finance of the residential mortgage loan accounts in the principal dwelling home and buy-to-let sector respectively in arrears of between 181 to 360 days, as provided to the Central Bank of Ireland for its quarterly report, if he will provide in tabular form the number of these loans broken down by the value of the outstanding balance as defined in the Central Bank of Ireland statistics as follows: balances outstanding below €250,000, between €250,001 and €500,000, between €500,001 and €750,000, between €750,001 and €1 million; the number of those with a balance outstanding of more than €1 million respectively in arrears of between 181 to 360 days; if he will provide details of the numbers by institution; and if he will make a statement on the matter. [27311/14]
View answer170. Deputy Kevin Humphreys asked the Minister for Finance of the residential mortgage loan accounts in the principal dwelling home and buy-to-let sector respectively in arrears of between 361 to 720 days, as provided to the Central Bank of Ireland for its quarterly report, if he will provide in tabular form the number of these loans broken down by the value of the outstanding balance as defined in the Central Bank of Ireland statistics as follows: balances outstanding below €250,000, between €250,001 and €500,000, between €500,001 and €750,000, between €750,001 and €1 million; the number of those with a balance outstanding of more than €1 million respectively in arrears of between 361 and 720 days; if he will provide details of the numbers by institution; and if he will make a statement on the matter. [27312/14]
View answer171. Deputy Kevin Humphreys asked the Minister for Finance of the residential mortgage loan accounts in the principal dwelling home and buy-to-let sector respectively in arrears of over 720 days, as provided to the Central Bank of Ireland for its quarterly report, if he will provide in tabular form the number of these loans broken down by the value of the outstanding balance as defined in the Central Bank of Ireland statistics as follows: balances outstanding below €250,000, between €250,001 and €500,000, between €500,001 and €750,000, between €750,001 and €1 million; the number of those with a balance outstanding of more than €1 million respectively in arrears of over 720 days: if he will provide details of the numbers by institution; and if he will make a statement on the matter. [27313/14]
View answerI propose to take Questions Nos. 167 to 171, inclusive, together.
I have been advised by the Central Bank that it does not publish data on the particular basis requested. The mortgage arrears statistics, including aggregated data by duration of arrears, as published by the Central Bank are available at the following:
http://www.centralbank.ie/polstats/stats/mortgagearrears/Documents/2014q1_ie_mortgage_arrears_statistics.pdf
http://www.centralbank.ie/polstats/stats/mortgagearrears/Pages/Data.aspx .
172. Deputy Seán Kyne asked the Minister for Finance if his attention has been drawn to the UK's patent box incentive which encourages and facilitates companies in reducing taxation obligations on the condition of registering patents in that jurisdiction; and his views on the way Ireland can compete with such an initiative in continuing to attract foreign direct investment. [27332/14]
View answerMy Department is very conscious of the need to maintain a competitive corporate tax regime and to that end, closely monitors developments in other countries. The changes that I have introduced in recent budgets and Finance Acts highlight the on-going work by my Department to make sure that the Irish corporate tax offering stays competitive as we work to attract investment and jobs to Ireland. For example, in recent years we have made further enhancements to the R&D regime, introduced a tax regime for Real Estate Investment Trusts and the package of measures to assist the SME sector (among others).
173. Deputy Seán Kyne asked the Minister for Finance in recognition of the increase in budget 2012 in the threshold at which the universal social charge, USC, applies which removed over 330,000 persons from this charge, if consideration will be given to reducing the overall rate of USC in view of the fact that the charge was initially introduced as an emergency taxation measure at a time of severe economic and financial turmoil for the State; and if he will make a statement on the matter. [27334/14]
View answerThe 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. I should point out that it was never intended that the USC would be a temporary measure. It was designed and incorporated in to the Irish taxation system as part of its permanent structure and the revenues collected play a vital part in meeting the many expenditure demands placed on the Exchequer.
As you have alluded to, as a result of a review of the USC conducted by my Department in 2011, 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. As part of the normal budgetary preparations, my officials will examine potential options for changes to the tax system for my consideration as part of the overall Budget package. However, it should be borne in mind that under the terms of the Stability and Growth Pact, until Ireland has reached its objective of a balanced budget in structural terms, we may not introduce discretionary revenue reductions unless they are matched by other revenue increases or expenditure reductions.
174. Deputy Stephen S. Donnelly asked the Minister for Finance further to the recent appointment of a person (details supplied) to the board of the National Asset Management Agency, NAMA, in April 2014, if he will provide an outline of the steps taken to advertise the vacancy; the number of applications for the vacancy; the number of candidates interviewed for the vacancy; the date on which those interviews took place; and if he will make a statement on the matter. [27364/14]
View answer175. Deputy Stephen S. Donnelly asked the Minister for Finance further to the recent revelation in the 2013 National Asset Management Agency, NAMA, annual report that a person (details supplied) was appointed to the NAMA board in April 2014, the reason the appointment was not advertised by him in Iris Oifigiúil or announced with a Department or ministerial statement. [27365/14]
View answerI propose to take Questions Nos. 174 and 175 together.
I appointed Ms Hurley to the Board of NAMA on the 8th of April as I felt she has significant experience in finance at both a senior management and board level which will make her an asset to the Board of NAMA. This appointment was not drawn from the public appointment process. Not all appointments are announced by a press release from my Department. However, this is not a reflection on Ms. Hurley's appointment.
176. Deputy Stephen S. Donnelly asked the Minister for Finance further to the publication by the National Asset Management Agency on 9 June 2014 of its management report and accounts for the last three months of 2013, if fresh litigation was initiated by NAMA in Q4, 2013 that is private and consequently not reported by NAMA; and if he will make a statement on the matter. [27366/14]
View answerI am advised by NAMA that all litigation initiated by it is a matter of public record as set out in its quarterly Section 55 reports.
177. Deputy Stephen S. Donnelly asked the Minister for Finance further to the publication by the National Asset Management Agency, NAMA, on 9 June 2014 of its management report and accounts for the last three months of 2013, the reason NAMA no longer provides a quantification of judgment sums sought in proceedings; and if he will make a statement on the matter. [27367/14]
View answerI am advised by NAMA that the information provided in the Section 55 report for the fourth quarter of 2013 is as set out in the NAMA Act, namely the title of the proceedings, the parties to it and the reliefs sought by NAMA. There is no requirement under the Act that the information provided should include a quantification of judgement sums sought in the proceedings. To assist the Deputy NAMA have provided the information below including the quantification of judgement sums sought for Q4 2013.
4 (vi) SECTION 55 (6) (E) - NUMBER OF LEGAL PROCEEDINGS COMMENCED BY NAMA AND EACH NAMA GROUP ENTITY IN THE QUARTER
List of all legal proceedings (except any proceeding in relation to which a rule of law prohibits publication)
|
Proceeding |
Title |
Parties to the proceeding |
Relief sought by NAMA or the NAMA group entity |
|
(i) |
High Court Record No. 2013/5016 |
NALM v Sean Kelly |
Petition for Order of Bankruptcy of Sean Kelly |
|
(ii) |
High Court Record No2013 3539 S |
NALM v Veronne Kelly |
Order for Judgment - €35,850,133.00 |
|
(iii) |
High Court Record Number 2013 / 3236 S |
NALM v Gerard Burke and Justin Burke |
Order for Judgment - €9,678,234.66. |
|
(iv) |
High Court Chancery Division HL 13 FO4813 |
NALM v Tower Bridge Road Developments Ltd, Aparthotels (Bermondsey) Ltd, Aparthotels (Tower Bridge) Ltd, Warwick Road Development Ltd, Warwick Road Developments Ltd, Think Apartments Ltd, Zucca Restaurant Ltd. |
Order for possession and other reliefs |
|
(v) |
High Court Record No. 2013/4233S |
NALM v Barry Harte |
Order for Judgment - €7,120,780.21 |
|
(vi) |
High Court Record No. 2013/4233S |
NALM v Conor Phelan |
Order for Judgment - €7,120,780.21 |
|
(vii) |
High Court Record No. 2013/4233S |
NALM v Noel Somers |
Order for Judgment - €7,120,780.21 |
|
(viii) |
High Court Record No. 2013/4233S |
NALM v Liam Murphy |
Order for Judgment - €7,120,780.21 |
|
(ix) |
High Court Record No. 2013/4233S |
NALM v Seamus Keating (Estate of) |
Order for Judgment - €7,120,780.21 |
|
(x) |
High Court Record No. 2013/4233S |
NALM v Niall O'Driscoll (Estate of) |
Order for Judgment - €7,120,780.21 |
|
(xi) |
High Court Record No. 2013/4233S |
NALM v Tadgh O'Brien |
Order for Judgment - €7,120,780.21 |
|
(xii) |
High Court Record No. 2013/4233S |
NALM v Richard Fitzgerald |
Order for Judgment - €7,120,780.21 |
|
(xiii) |
High Court Record No. 2013/4233S |
NALM v James Whelan |
Order for Judgment - €7,120,780.21 |
|
(xiv) |
High Court Record Number 2013 / 4302 S |
NALM v Desmond Rogers |
Order for Judgment - €6,469,663.41 |
|
(xv) |
High Court Queen's Bench Division HQ13X56038 |
NALM v Graham Harris |
Order for Judgment in the sum of £225,536,508.10 and €4,295,829.84 plus interest. |
|
(xvi) |
High Court Record Number 2013 4433 S |
NALM -v- Patrick Wheelock |
Order for Judgment - €2,603,513.58 |
|
(xvii) |
High Court Record Number 2013 4443 S |
NALM -v- Des McSwiggan and Vivienne McSwiggan |
Order for Judgment - €3,601,487.37 |
178. Deputy Stephen S. Donnelly asked the Minister for Finance further to Parliamentary Question No. 171 of 10 June 2014, where he acknowledged an arrangement between the joint special liquidators of the Irish Bank Resolution Corporation and two unidentified parties, whereby the latter will be given 3% of any assets recovered through the provision of their information, if any other similar arrangement has been struck by either IBRC or the JSLs with respect to any other sum owed to IBRC. [27368/14]
View answerI have been advised by the Special Liquidators that Irish Bank Resolution Corporation Limited ("IBRC") engaged with foreign companies to assist with the recovery of assets beneficially held by the Quinn Group. This was disclosed in the Affidavit of Richard Woodhouse (Group Head of Specialised Asset Management of IBRC at that time) dated 31 October 2012 for the purposes of apprising the High Court and the Quinns about the proposed arrangement with A1 Group Limited, a local asset recovery specialist in the Russian Federation and the Ukraine, an arrangement which was subsequently entered into by IBRC. I am advised by the SLs that they are not aware of any other similar arrangements in relation to sums owed to IBRC.
179. Deputy Stephen S. Donnelly asked the Minister for Finance further to Parliamentary Question No. 171 of 10 June 2014, where he acknowledged an arrangement between the joint special liquidators of the Irish Bank Resolution Corporation and two unidentified parties, whereby the latter will be given 3% of any assets recovered through the provision of their information, if any such similar arrangement exists at the National Asset Management Agency; and if not, if such an arrangement will be made available to potential informants. [27369/14]
View answerI am advised by NAMA that while such an approach has not been ruled out, it is not currently under consideration. There are no such arrangements in place with any third parties.
