James Lawless
Question:96. Deputy James Lawless asked the Minister for Finance the reason for the higher tax rates for vehicles registered from 2008 and subsequent years; and if he will make a statement on the matter. [21397/16]
View answerMotor Tax Rates
Questions (96)
Written answers
The system of VRT was revised in 2008. The VRT rate applicable to both new and used imported cars registered on or after 1 July 2008 is determined by the CO2 emission rating of the car and is no longer related to engine size. The VRT rate is applied to the Open Market Selling Price of the car, as before 2008. There are eleven CO2 emission bands with VRT rates ranging from 14% to 36%. The emissions-based system was instituted in order to incentivise a movement to lower emissions vehicles, and contribute to lowering Ireland's transport related carbon emissions in order to meet EU targets. The revised VRT system rebalances VRT so that consumers would be rewarded for choosing lower CO2 emission vehicles. Consumers have significant control over their VRT liability (ranging from 14% to 36%) depending on type of vehicle they choose to buy.
Motor Insurance Regulation
Questions (97)
Eamon Scanlon
Question:97. Deputy Eamon Scanlon asked the Minister for Finance if he will meet with stakeholders involved in the liquidation of Setanta Insurance to discuss the issues affecting claimants; if he will investigate the roles of the Motor Insurers' Bureau of Ireland, the Insurance Compensation Fund, the Central Bank and his Department in the event of another insurance company collapsing; and if he will make a statement on the matter. [21400/16]
View answerWritten answers
The liquidation of an insurance company is a legally complex process. Setanta is a Maltese incorporated company and, therefore, the Setanta liquidation is being carried out under Maltese law.
Progress in the liquidation of Setanta Insurance has been awaiting the outcome of legal proceedings in the case of the Law Society of Ireland versus the Motor Insurers' Bureau of Ireland (MIBI). On 4th September 2015, the High Court held that the MIBI is liable in respect of claims against the policy holders of Setanta. This decision was subsequently appealed by the MIBI and the Court of Appeal upheld the High Court decision. The MIBI has been granted leave to appeal the decision to the Supreme Court. As this case is sub-judice, there are certain matters which I am not in a position to comment on at this time.
The Minister for Transport, Tourism and Sport and I have asked our officials to carry out a review of the framework for motor insurance compensation in Ireland, in the event of a failure of an insurance company. The objective of the review is to identify the features of a motor insurance compensation framework that is comprehensive, effective, affordable and consumer-focused.
The Joint Working Group has engaged with relevant stakeholders involved in the governance and administration of the motor insurance compensation system including the Central Bank of Ireland, the Accountant of the Courts of Justice, the State Claims Agency and representatives of the insurance industry in Ireland. The models in place in other jurisdictions have also been considered.
The Minister for Transport, Tourism and Sport and I are currently considering the Joint Working Group's report with a view to publication in the coming weeks. The report includes recommendations aimed at providing certainty regarding the compensation framework in Ireland.
Tax Code
Questions (98)
Micheál Martin
Question:98. Deputy Micheál Martin asked the Minister for Finance the status of Oaktree Capital and its obligations to pay tax in Ireland; if it has adhered to these; and if he will make a statement on the matter. [21415/16]
View answerWritten answers
I am advised by the Revenue Commissioners that for reasons of taxpayer confidentiality it does not disclose details of the tax affairs of any individual or company to a third party. I am therefore unable to make any statement in relation to the matter.
Mortgage Arrears Proposals
Questions (99, 100)
Micheál Martin
Question:99. Deputy Micheál Martin asked the Minister for Finance the status of hedge funds which bought out homes from banks and which are now requiring the previous owners to depart from their homes so that they can be sold in better market conditions; and if he will make a statement on the matter. [21416/16]
View answerMicheál Martin
Question:100. Deputy Micheál Martin asked the Minister for Finance if he is concerned about homes still being repossessed; and if he will make a statement on the matter. [21417/16]
View answerWritten answers
I propose to take Questions Nos. 99 and 100 together.
The Deputy will be well aware that the Government attaches great importance to addressing the issue of mortgage arrears and wants to keep families in their homes and avoid repossessions insofar as possible. In this context, it is important to note that the overall level of repossession orders being granted by the Courts is low relative to the number of accounts in mortgage arrears.
The numbers in mortgage arrears have been steadily declining. Data released by the Central Bank on 10 June shows that to end-Q1 2016, the number of mortgage accounts in arrears for principal dwelling houses (PDH) has declined for the last eleven quarters. Some 120,447 PDH accounts were also classified as restructured. It is clear that where a borrower actively engages with their lender under the CCMA with a view to agreeing a sustainable arrangement to address their mortgage arrears, it is more likely that an equitable arrangement will be found and that borrower will be able to remain in their family home. It is important to also note that the commencement of the court process is not a signal that a repossession will occur it may often be the case that the process then prompts borrowers to re-engage with their bank and to find a solution. Often these cases are adjourned to allow both parties time to find a sustainable solution.
While the CCMA is an important element in consumer protection, it should be noted a borrower's rights are not confined to the provisions of the CCMA. There have been very significant reforms to insolvency legislation over the last number of years. Under this legislation a borrower can engage a Personal Insolvency Practitioner (PIP) to propose a Personal Insolvency Arrangement (PIA) to creditors in order to resolve an unsustainable debt position.
Following legislation introduced in 2015, if such a PIA proposal is rejected by creditors, the Personal Insolvency Act has now been amended to provide that the proposal can then be submitted to a Court for adjudication, thus removing the lender's automatic veto on sustainable proposals for personal insolvency arrangements.
With respect to the question of loans that have been sold to third parties, the Deputy will be aware that the Consumer Protection (Regulation of Credit Servicing Firms) Act, 2015 was enacted on 8 July 2015. It was introduced to fill the consumer protection gap where loans were sold by the original lender to an unregulated entity. The 2015 Act introduced a regulatory regime for a new type of entity called a 'credit servicing firm'. Credit Servicing Firms are now subject to the provisions of Irish financial services law that apply to 'regulated financial service providers'. This ensures that relevant borrowers, whose loans are sold to third parties, maintain the same regulatory protections they had prior to the sale, including under the various statutory codes, such as the Consumer Protection Code, the Code of Conduct on Mortgage Arrears and the Code of Conduct for Business Lending to Small and Medium Enterprises. The Act means that any purchasers of loans books are required either to become regulated themselves by the Central Bank or use a regulated credit servicing firm to service their loans.
The Act also ensures that a regulated credit servicing firm cannot do something, or fail to do something, which would be a prescribed contravention if performed, or not performed, by a retail credit firm. It also prevents the owner of credit from instructing a regulated credit firm to perform such an action, thereby further enhancing the consumer's protections.
New owners must either become regulated as credit servicing firms themselves or use a regulated credit servicing firm to service their loans.
National Broadband Plan
Questions (101)
Brian Stanley
Question:101. Deputy Brian Stanley asked the Minister for Finance the effect of adopting the full concession model for the national broadband plan on the State's balance sheet. [21421/16]
View answerWritten answers
The National Broadband Plan is a priority for Government that will be delivered by my colleague the Minister for Communications, Energy and Natural Resources and questions relating to it should be directed to him.
However the Deputy should be aware that the Government does not intend to publish the expected cost of building the network, the likely cost to the State or the expected terminal value of the network, while a major public procurement process is underway.
Tax Code
Questions (102, 103, 104)
Bobby Aylward
Question:102. Deputy Bobby Aylward asked the Minister for Finance if he will consider raising the tax-free group B threshold from €30,150 for those inheriting cash or assets from someone outside of their direct family, given that the group A threshold was increased to €280,000 in budget 2016; and if he will make a statement on the matter. [21491/16]
View answerBobby Aylward
Question:103. Deputy Bobby Aylward asked the Minister for Finance his views on the huge difference between the tax-free group A and group B thresholds for inheriting money or assets and the inequality it imposes on older citizens who have no children but who may wish to pass on money or assets to nieces or nephews who have cared for them in later life; and if he will make a statement on the matter. [21492/16]
View answerBobby Aylward
Question:104. Deputy Bobby Aylward asked the Minister for Finance the plans and provisions he is examining and implanting for the tax-free group B threshold for those inheriting money or assets from persons outside of their direct family ahead of budget 2017; and if he will make a statement on the matter. [21493/16]
View answerWritten answers
I propose to take Questions Nos. 102 to 104, inclusive, together.
Capital Acquisitions Tax (CAT) is the overall title for gift and inheritance tax.
For the purposes of CAT, the relationship between the person who provides the gift or inheritance (i.e. the disponer) and the person who receives the gift or inheritance (i.e. the beneficiary), determines the maximum life-time tax-free threshold known as the "Group threshold" below which gift or inheritance tax does not arise.
There are, in all, three separate Group thresholds based on the relationship of the beneficiary to the disponer.
Group A: tax free threshold €280,000 applies where the beneficiary is a child (including adopted child, stepchild and certain foster children) or minor child of a deceased child of the disponer. Parents also fall within this threshold where they take an inheritance of an absolute interest from a child. I raised this threshold from €225,000 to its current level as part of Budget 2016.
Group B: tax free threshold €30,150 applies where the beneficiary is a brother, sister, a nephew, a niece or lineal ancestor or lineal descendant of the disponer.
Group C: tax free threshold €15,075 applies in all other cases.
Transfers and inheritance between spouses are not subject to CAT.
Where a person receives gifts or inheritances in excess of their relevant tax free threshold, CAT at a rate of 33% applies on the excess over the tax free threshold.
I have indicated that I see the recent change to the Group A threshold as the beginning of a process. The Deputy will be aware of the commitment in the Programme for a Partnership Government to work with the Oireachtas to raise the Band A capital acquisitions tax threshold (including all gifts and inheritances from parents to their children) to €500,000. Depending on various factors, including the state of the public finances, I will examine the scope for further changes in the future, including the possibility of changes to the Group B and Group C thresholds.