Written Answers Nos. 97-111
97. Deputy Pearse Doherty asked the Minister for Finance further to Parliamentary Questions Nos. 138 and 139 of 6 April 2016, if he will provide further details of each of the tax credits referred to and the associated revenue generated from the tapering out of these tax credits, that is, a detailed breakdown of the composition of the €618 million and €872 million respectively. [6536/16]
View answer98. Deputy Pearse Doherty asked the Minister for Finance the revenue from tapering out the personal, pay as you earn, and earned income credits by 2.5% per €1,000 on individual income between €100,000 and €140,000 per year, resulting in no entitlement to these tax credits when income is in excess of €140,000. [6537/16]
View answer99. Deputy Pearse Doherty asked the Minister for Finance the revenue from tapering out the personal, pay as you earn, and earned income credits by 2% per €1,000 on individual income between €100,000 and €150,000 per year, resulting in no entitlement to these tax credits when income is in excess of €150,000. [6538/16]
View answer100. Deputy Pearse Doherty asked the Minister for Finance the revenue from tapering out the personal, pay as you earn, and earned income credits by 5% per €1,000 on individual income between €100,000 and €120,000 per year, resulting in no entitlement to these tax credits when income is in excess of €120,000. [6539/16]
View answer101. Deputy Pearse Doherty asked the Minister for Finance the revenue from tapering out the personal, pay as you earn, and earned income credits by 5% per €1,000 on individual income between €100,000 and €120,000 per year, resulting in no entitlement to these tax credits when income is in excess of €120,000, and coupled with this, a 2% levy on individual income between €120,000 to €200,000, a 4% levy on individual income between €200,000 and €250,000 and a 5% levy on individual income in excess of €250,000. [6540/16]
View answer102. Deputy Pearse Doherty asked the Minister for Finance the revenue from tapering out the personal, pay as you earn, and earned income credits by 5% per €1,000 on individual income between €100,000 and €120,000 per year, resulting in no entitlement to these tax credits when income is in excess of €120,000, and coupled with this, a 5% levy on individual income between €120,000 to €200,000, a 6% levy on individual income between €200,000 and €250,000 and a 7% levy on individual income in excess of €250,000. [6541/16]
View answer103. Deputy Pearse Doherty asked the Minister for Finance the revenue from tapering out the personal, pay as you earn, and earned income credits by 2.5% per €1,000 on individual income between €100,000 and €140,000 per year, resulting in no entitlement to these tax credits when income is in excess of €140,000, and coupled with this, a 2% levy on individual income between €140,000 to €250,000 and a 5% levy on individual income in excess of €250,000. [6542/16]
View answer104. Deputy Pearse Doherty asked the Minister for Finance the revenue from tapering out the personal, pay as you earn, and earned income credits by 2.5% per €1,000 on individual income between €100,000 and €140,000 per year, resulting in no entitlement to these tax credits when income is in excess of €140,000, and coupled with this, a 4% levy on individual income between €140,000 to €200,000 and a 5% levy on individual income in excess of €200,000. [6543/16]
View answer105. Deputy Pearse Doherty asked the Minister for Finance the revenue from tapering out the personal, pay as you earn, and earned income credits by 2% per €1,000 on individual income between €100,000 and €150,000 per year, resulting in no entitlement to these tax credits when income is in excess of €150,000, and coupled with this, a 4% levy on individual income between €150,000 to €250,000 and a 5% levy on individual income in excess of €250,000. [6544/16]
View answerI propose to take Questions Nos. 97 to 105, inclusive, together.
I am advised by the Revenue Commissioners that a breakdown of the estimated yield which would arise from the measure outlined in Parliamentary Question Number 139 of 6 April 2016 is provided in the following table.
|
Credit |
First Year €m |
Full Year €m |
|
Personal Credit |
404.76 |
586 |
|
PAYE Credit |
189.54 |
243 |
|
Earned Income Credit |
1.38 |
4.6 |
|
Additional Credit for Incapacitated Child |
6.05 |
10.34 |
|
Person Taking Care of Incapacitated Taxpayer |
5.13 |
8.89 |
|
Home Carer Tax Credit |
5.16 |
8.09 |
|
Age Tax Credit |
3.19 |
6.05 |
|
Single Person Child Carer Credit * |
2.09 |
3.76 |
|
Additional Bereavement Credit to Widowed Parent |
0.34 |
0.63 |
|
Dependent Relative Tax Credit |
0.12 |
0.22 |
|
Revenue Job Assist |
0.12 |
0.21 |
|
Blind Person's Credit including Guide Dog Allowance |
0.09 |
0.17 |
|
Seafarers Allowance |
0.07 |
0.16 |
|
Estimated Total Yield |
618 |
872 |
*The estimated yield from applying the measure to the Single Person Child Carer Credit is based on 2013 Returns in respect of the One Parent Family Tax Credit which it replaced.
The estimated first and full year yield to the Exchequer of tapering the Personal, PAYE and the Earned Income Credits by 2.5% per €1,000 on income between €100,000 and €140,000, resulting in no entitlement to these credits on income in excess of €140,000, is in the order of €308 million and €424 million respectively.
In relation to tapering the Personal, PAYE and the Earned Income Credits by 2% per €1,000 on income between €100,000 and €150,000, resulting in no entitlement to these credits on income in excess of €150,000, the estimated first and full year yield to the Exchequer is in the order of €281 million and €387 million respectively.
As regards the first and full year yield to the Exchequer of tapering the PAYE and the Earned Income Credits by 5% per €1,000 on income between €100,000 and €120,000, resulting in no entitlement to either credit on income in excess of €120,000, this is estimated to be in the order of €158 million and €204 million respectively.
The estimated first and full year yield to the Exchequer of tapering the Personal, PAYE and the Earned Income Credits by 5% per €1,000 on income between €100,000 and €120,000, resulting in no entitlement to these credits on income in excess of €120,000, and the introduction of a 2%, 4% and 5% income levy, at the thresholds specified by the Deputy, is in the order of €583 million and €812 million respectively.
In relation to the first and full year yield to the Exchequer of tapering the Personal, PAYE and the Earned Income Credits by 5% per €1,000 on income between €100,000 and €120,000, resulting in no entitlement to these credits on income in excess of €120,000, and the introduction of a 5%, 6% and 7% income levy, at the thresholds specified by the Deputy, this is estimated to be in the order of €737 million and €1,032 million respectively.
As regards the first and full year yield to the Exchequer of tapering the Personal, PAYE and the Earned Income Credits by 2.5% per €1,000 on income between €100,000 and €140,000, resulting in no entitlement to these credits on income in excess of €140,000, and the introduction of a 2% and 5% income levy, at the thresholds specified by the Deputy, this is estimated to be in the order of €497 million and €693 million respectively.
The estimated first and full year yield to the Exchequer of tapering the Personal, PAYE and the Earned Income Credits by 2.5% per €1,000 on income between €100,000 and €140,000, resulting in no entitlement to these credits on income in excess of €140,000, and the introduction of a 4% and 5% income levy, at the thresholds specified by the Deputy, is in the order of €554 million and €775 million respectively.
As regards the first and full year yield to the Exchequer of tapering the Personal, PAYE and the Earned Income Credits by 2% per €1,000 on income between €100,000 and €150,000, resulting in no entitlement to these credits on income in excess of €150,000, and the introduction of a 4% and 5% income levy, at the thresholds specified by the Deputy, this is estimated to be in the order of €503 million and €704 million respectively.
The estimates above are from the Revenue tax forecasting model using latest actual data for the year 2013, adjusted as necessary for income, self-employment and employment trends in the interim. They are estimated by reference to 2016 incomes and are provisional and may be revised.
Finally, I have been advised by the Revenue Commissioners that, given the current tax structures, major issues would need to be resolved as to how in practice such a credit tapering could be integrated into the current system and how this would affect the relative position of different types of income earners.
107. Deputy Charlie McConalogue asked the Minister for Finance why a cohabiting couple is not allowed to be assessed as a married couple for tax purposes whereby a person who is in full-time employment is not able to claim the partner's tax credits but such a couple is entitled to be assessed as a couple for social protection proposes; and if he will make a statement on the matter. [6570/16]
View answerAs the Deputy may be aware, in general, there are no special income tax reliefs for unmarried couples living together. In this context, tax law follows the general law relating to marriage. The basis for the current taxation of married couples derives from the Supreme Court decision in Murphy v. the Attorney General (1980) which held that it was contrary to the Constitution for a married couple to pay more tax than two single people living together.
In the case of cohabiting couples each partner is taxed as a single person and each is entitled to the tax credits and standard rate band appropriate to single persons. The same tax credits and standard rate bands are available to a married couple, with the difference being that one spouse's personal tax credit and a portion of his or her standard rate band may be transferred to the other spouse if they so choose. This can be of benefit where one spouse has low income or does not work outside the home, and therefore does not use their own credit and rate bands in full.
From a practical perspective, it would be very difficult to administer a tax regime for cohabitants which would be the same as that for married couples or civil partners. Married couples and civil partners have a verifiable official confirmation of their status. It would be difficult, intrusive and time-consuming to confirm declarations by individuals that they were actually cohabiting. It would also be difficult to establish when cohabitation started or ceased.
It should also be noted that while there may be an advantage in tax legislation for a married couple or civil partners, their legal status has wider consequences from a tax perspective, both for themselves and for persons connected with them.
To counter tax avoidance, transactions between 'connected persons' are frequently subject to anti-avoidance provisions throughout the various Tax Acts. The definitions of 'connected persons' extend to relatives and children of spouses and civil partners. Were the tax treatment of married couples and civil partners to be extended to cohabiting couples, it would be very difficult to prove and enforce such anti-avoidance measures in respect of persons connected with a cohabiting couple where the cohabiting couple has no legal recognition.
The treatment of cohabiting couples for the purposes of social welfare is primarily a matter for my colleague, the Minister for Social Protection, Ms Joan Burton T.D. However, it is also based on the principle that married couples should not be treated less favourably than cohabiting couples. This was given a constitutional underpinning following the Supreme Court decision in Hyland v Minister for Social Welfare (1989) which ruled that it was unconstitutional for the total income a married couple received in social welfare benefits to be less than the couple would have received if they were unmarried and cohabiting.
To the extent that there are differences in the tax treatment of the different categories of couples, such differences arise from the objective of dealing with different types of circumstances while at the same time respecting the constitutional requirements to protect the institution of marriage. Any change in the tax treatment of cohabiting couples can only be addressed in the broader context of future social and legal policy development in relation to such couples.
108. Deputy Billy Kelleher asked the Minister for Finance how he can assist persons who are unable to avail of the home renovation incentive scheme due to builders not signing off on the documentation needed for the Revenue Commissioners to allow persons to claim tax relief on improvement works carried out on their homes. [6575/16]
View answerThe Home Renovation Incentive (HRI) came into operation on 25 October 2013 and will run until 31 December 2016. The incentive provides tax relief for homeowners by way of a tax credit at 13.5% of qualifying expenditure incurred on repair, renovation or improvement work carried out on a principal private residence, or by landlords on a rental property. Qualifying expenditure is that which is subject to the 13.5% VAT rate. The work must cost a minimum of €4,405 (exclusive of VAT) at which level it would attract a credit of €595. Where the cost of the work exceeds €30,000 (exclusive of VAT) a maximum credit of €4,050 will apply. The credit is payable over the two years following the year in which the work is carried out.
Homeowners must be Local Property Tax compliant on all properties they own in order to qualify under the Incentive, while building contractors must be tax compliant in order to carry out works.
Contractors are required to inform Revenue in advance of details of works to be carried out and are also required to notify Revenue in relation to any payments received in respect of the works. The homeowner/landlord is able to check that the contractor is a qualifying contractor for the purposes of the Incentive and if the proposed works have been registered through Revenue's electronic systems, and are able to claim the relief through those same systems. The homeowner/landlord will also be provided with the unique reference number for the work when checking the Home Renovation Incentive online system.
The confirmation in relation to the contractor and unique reference number for the work will be available for the homeowner/landlord to view at any time through the Home Renovation Incentive online system. It is the responsibility of the homeowner/landlord to check the online system to confirm that the contractor is a qualifying contractor. The homeowner/landlord can also check to confirm all the information has been notified before making the final payment.
The Incentive is designed in such a way that if work is not notified to the Home Renovation Incentive online system, the homeowner/landlord will not be able to claim a tax credit in respect of payments for the work.
109. Deputy Michael Healy-Rae asked the Minister for Finance the status of insurance for first responders (details supplied); and if he will make a statement on the matter. [6651/16]
View answerThe provision of insurance cover and the price at which it is offered is a commercial matter for insurance companies and is based on an assessment of the risks they are willing to accept and adequate provisioning to meet those risks.
As Minister for Finance, I am responsible for the development of the legal framework governing financial regulation. Neither I, nor the Central Bank of Ireland, may interfere in the provision of insurance products. The EU framework for insurance expressly prohibits Member States from adopting rules which require insurance companies to obtain prior approval of the pricing, or terms and conditions of an insurance product.
Insurance Ireland, which represents the insurance industry in Ireland, has informed me that each individual insurer will use its own underwriting criteria in deciding the premium for a risk. If an individual using her/his car as a First Responder feels that they are being unfairly charged they may contact Insurance Ireland's Insurance Information Service (01 6761914).
110. Deputy John McGuinness asked the Minister for Finance to review an application from a person (details supplied) in County Kilkenny for a refund of VAT and vehicle registration tax under the disabled driver and disabled passenger scheme. [6663/16]
View answerI am advised by Revenue that in the particular case concerned, the car was not registered, and therefore VAT or VRT was not borne or paid, prior to the death of the primary medical certificate holder. Additionally, it is a condition of the scheme that the car must be used for the transport of the person with a disability.
I am assured by Revenue that there was no delay in processing the application - the exemption certificate was issued on the same day the required documentation in support of the application was received. Sadly, the person with the disability passed away on the same day.
Unfortunately, it is not possible to allow relief even in the difficult circumstances concerned.
111. Deputy Richard Boyd Barrett asked the Minister for Finance the updated figures for the projected fiscal space for each of the years from 2016 to 2018. [6669/16]
View answerAs the Deputy will be aware, estimates of fiscal space for the period 2016 - 2018 were published by my Department in the documentation accompanying the 2016 Budget last October. Updated figures are being prepared by my Department as part of the preparations for SPU 2016. These will take account of any updated assumptions including general government expenditure levels for 2015 due to be published by the CSO as part of the government finance statistics later this month. The decision on when to publish any revisions to these tables is one for the Government.
