Written Answers Nos. 70 - 96
70. Deputy Brendan Howlin asked the Tánaiste and Minister for Justice and Equality further to her letter of 6 October 2016, if the terms of reference for the five inquiries to be established under section 42 of the Garda Síochána Act 2005 have been settled; when these inquiries will proceed; and if she will make a statement on the matter. [34008/16]
View answerThe five inquiries to which the Deputy refers are to be established following my acceptance of recommendations by the panel of the Independent Review Mechanism.
As I pointed out to the Deputy in the letter to which he refers, section 42 (3A) of the Garda Síochána Act 2005, as amended, requires me to consult with the Policing Authority with regard to the terms of reference for these inquiries. Consultations are ongoing and, once they are settled, I can assure the Deputy that it is my firm intention that the inquiries will commence as soon as practicable thereafter.
71. Deputy Sean Fleming asked the Tánaiste and Minister for Justice and Equality if she will provide a list of all contingent assets in her Department and in agencies under her Department where amounts can be owed but are not listed in the national accounts as an asset; if she will further provide a full breakdown of each category of contingent assets and the estimated amounts in the category; and if she will make a statement on the matter. [34080/16]
View answerI wish to advise the Deputy that as my Department does not prepare accounts under the accruals convention, the question of recognition or accounting for contingent assets does not arise.
72. Deputy Róisín Shortall asked the Tánaiste and Minister for Justice and Equality if she will make resources available within her Department to support and facilitate a centre (details supplied) in view of the improving economic conditions. [34085/16]
View answerA second Sexual Assault and Violence in Ireland study (SAVI 2) would show the prevalence of and attitudes to sexual violence and elucidate how the experience has changed since SAVI 1. The overall cost of a report is likely to be in the order of €1 million over three years. A formal proposal submitted by the Dublin Rape Crisis Centre recognised that, given the significant budget, funding would be divided between four Departments - the Departments of Justice and Equality, Children and Youth Affairs, Education and Skills, and Health. I wrote to the relevant Ministers on this matter and expressed my support for the project. The responses received make the viability of funding the project, as proposed, unlikely.
However, my Department continues to investigate the financial feasibility, resource implications and approaches to identifying a ring-fenced funding stream for undertaking a SAVI 2 study and to explore obligations with regard to requisite public procurement arrangements. While I strongly recognise the value of further research in this area, I am sure the Deputy will accept that the right balance must be struck between the funding of front-line services and funding research. I will, however, continue to pursue this matter.
It may be helpful to add that in March 2014, the European Union Agency for Fundamental Rights (FRA) launched the results of the largest ever violence against women survey in the EU. Details of the prevalence of sexual violence by a partner or non-partner experienced by those women surveyed who are resident in Ireland are contained in this report.
73. Deputy David Cullinane asked the Minister for Finance if he or his Department have had any engagement with EU institutions regarding the fiscal rules since he came into office; the nature of this engagement; and if he will make a statement on the matter. [33887/16]
View answer74. Deputy David Cullinane asked the Minister for Finance if he or his Department have commissioned or developed any papers or strategies on achieving greater flexibility in relation to the application of the fiscal rules; and if he will make a statement on the matter. [33888/16]
View answerI propose to take Questions Nos. 73 and 74 together.
As the Deputy is aware (Parliamentary Questions 20 and 69 of 29/09/2016) the fiscal rules to which Ireland is subject have direct application through a number of EU regulations as well as having domestic legal effect through the Fiscal Responsibility Act 2012 following the passage of a constitutional referendum in May 2012. Changes to these regulations would have to follow the normal EU approach starting with a proposal from the Commission before consideration by Member States and the European Parliament.
I and my Department are active in a number of fora in the EU that discuss the fiscal rules, including the Economic and Financial Affairs Council (ECOFIN), the Economic and Finance Committee (EFC), the EFC-Alternates, the Economic Policy Committee (EPC) and the Output Gap Working Group (OGWG).
The issue of facilitating greater flexibility in the application of the fiscal rules has received significant focus at European level and framed discussions on the establishment of the structural and investment clauses, which were codified by the Commission in November 2015. Specifically these provisions allow for temporary deviations from the required structural budgetary adjustment, subject to strict conditions.
There are also certain more explicit flexibility provisions within the rules. For instance, within the expenditure benchmark pillar of the rules, public investment is granted favourable treatment - as a result of four-year capital smoothing, only one quarter of the increase in public investment must be funded in the first year from within the fiscal space. Furthermore, the fiscal rules aim to facilitate the conduct of counter-cyclical policy, notably via the cyclical conditions matrix.
Moreover, former practice involved reference rates being fixed every three years in the calculation of fiscal space under the expenditure benchmark. In the case of Ireland, this would have significantly supressed the permitted real net expenditure growth rate, since reference rates would have placed greater weight on an outdated outlook when potential growth was considerably weaker. In advance of Ireland entering the Preventive Arm, my officials initiated discussions with the Commission, calling for an annual recalibration of the reference rates and were successful in lobbying to the Commission to this end. This new approach significantly increases the permitted room for expenditure growth, which would not have been possible under the former practice.
Furthermore, in the same period, Ireland gained the endorsement of the EPC on an alternate and more plausible method of calculation of projected working age population growth to be used when estimating potential output, resulting in a 1.0 percentage point improvement in potential output growth for 2017-2020. The impact of these changes were described in Box 10 of the Spring Economic Statement 2015.
My Department continues to progress work aimed at producing sensible estimates of supply-side indicators, the importance of which has been repeatedly highlighted by the Irish Fiscal Advisory Council. A summary of this work has been included in Box 1 of the 2016 Stability Programme Update.
Finally, the harmonised methodology for calculating the economic cycle used in the implementation of the SGP remains an area with limitations within the fiscal rules. My Department has secured useful changes to this methodology over the years by consistently raising concerns and objections at European level. These changes have partially compensated for the reality that the harmonised methodology is not suitable for small open economies. My Department continues to advocate for improvements in the harmonised methodology and will continue to engage constructively on this and other relevant technical issues.
The fiscal rules are designed to promote budgetary discipline and underpin sustainable economic growth. While Ireland's economy is growing and debt is on a downward trajectory, the debt level is still comparably high and caution must be exercised due to the potential of rollover risk should interest rates increase. We are a small and very open economy in a world that has more risks than usual. It makes sense to reach a balanced budget in structural terms by 2018. Reducing our debt to much lower levels will increase our capacity to withstand shocks by building our capacity to borrow. Compliance with the fiscal rules underpins and facilitates this.
75. Deputy David Cullinane asked the Minister for Finance if he and his Department realise the distinction between borrowing for current spend and capital spend; if the EU rules restricting borrowing are limiting potential to invest in capital infrastructure; if he will seek changes in this regard; and if he will make a statement on the matter. [33889/16]
View answerI want to assure the Deputy that both I and my Department are conscious of the distinction between borrowing for current and capital purposes.
I also want to assure the Deputy that I and my Department are aware that our debt level is of the order €200 billion this year.
Moreover, both I and my Department are conscious of the fact that market access on reasonable terms is contingent upon continuing to reduce our debt-to-GDP ratio.
Having said that, I would point out that while my Department is forecasting an Exchequer current budget surplus of c.€2 billion in 2017, it is forecasting an Exchequer capital deficit of nearly €4.2 billion. In other words, we are borrowing for capital purposes.
The fiscal rules do not prevent or constrain public investment. The fiscal rules simply require that all expenditure - be it current or capital - is sustainably financed. Member States are free to choose whatever level of capital spending they like, subject to the requirement that the expenditure can be financed. Put another way, resources are finite - it is a question of whether we prioritise current expenditure or capital expenditure. This is, of course, a difficult balancing act, and in the recent Budget the Government struck an appropriate balance.
It is also worth pointing out the flexibility provisions within the fiscal rules for capital spending. For instance, within the expenditure benchmark pillar of the rules, public investment is granted favourable treatment through the four-year smoothing of capital formation increases. This means that only one quarter of the increase in public investment must be funded in the first year from within the fiscal space. Basically, this facilitates the front loading of capital formation increases.
In conclusion, sustainable public finances are a prerequisite for continued strong economic growth. My view is that the fiscal rules should not be seen as inhibiting policymakers - they are about ensuring sustainable improvements in living standards for all our citizens.
76. Deputy Eamon Ryan asked the Minister for Finance the reason combined heat and power engines are exempted from carbon tax in view of the fact that the signing of the Paris Agreement suggests significant efforts will need to be made to divest away from fossil fuels. [34067/16]
View answer77. Deputy Eamon Ryan asked the Minister for Finance the foregone taxation revenue from exempting combined heat and power engines from carbon tax. [34068/16]
View answerI propose to take Questions Nos. 76 and 77 together.
Combined Heat and Power (CHP) is the simultaneous generation of usable heat and electricity in a single process. The dual process of using energy inputs to generate both heat and power is the most efficient use of fuel with an energy efficiency of up to 80%, which is significantly higher than individual processes. It makes use of the heat produced in electricity generation instead of releasing it into the atmosphere.
The Department of Communications, Climate Action and Environment's White Paper on Ireland's Transition to a Low Carbon Energy Future 2015-2030 indicates that CHP can provide a method of improving efficiency of energy use leading to emission reductions, as well as committing to the development of a policy framework to encourage the growth of CHP. Biomass CHP as a power source will make a contribution towards achieving 2020 targets in both the renewable electricity and heat sectors. The paper takes into account European and International climate change objectives and agreements, as well as Irish social, economic and employment priorities.
In that context, my colleague the Minister for Communications, Climate Action and Environment wrote to me asking that I consider the supports for the incentivisation of CHP Plants in Budget 2017. Separately, the Commission for Energy Regulation (CER) is updating the certification processes and will now base certification on the fuel used in the highly efficient production of electricity in CHP Plants. This will provide relief retrospectively based on the actual data used in highly efficient production of electricity.
Work is ongoing to transition away from the use of fossil fuels, however, in the meantime, it is logical to ensure that when fossil fuels are used they are used as efficiently as possible. It is for that reason I decided to provide a full relief from the carbon tax when the fuel is used in a highly efficient process.
I am informed by Revenue that the partial carbon tax relief for fuel used for environmentally friendly CHP installations was introduced in the Finance Act 2012 and the cost to date of that relief is just under €760,000.
The following table contains the amounts claimed in 2014, 2015 and 2016 in respect of the relief and shows the total amount claimed since introduction.
|
YEAR |
Number of Claims |
Amount Refunded |
|
2014 |
2 |
€82,133.00 |
|
2015 |
24 |
€264,733.51 |
|
2016 |
44 |
€411,754.60 |
|
|
Total |
€758,621.11 |
The Finance Bill 2016 includes a proposal to introduce a full relief from carbon taxation for fuel used in CHP to produce high efficiency electricity. I am advised that Revenue has made an approximate estimate of just under €2m to provide full relief (€1.87m) for all fuel. This estimate is based upon information currently available which is largely composed of projected energy efficiency performance of CHP installations. This estimate also includes data concerning CHP units that are still in the planning stage, but have been included to avoid underestimation.
78. Deputy Brendan Griffin asked the Minister for Finance the length of time local property tax exemptions will remain for unfinished estates; and if he will make a statement on the matter. [33884/16]
View answerI am advised by Revenue that residential properties that are included in a list of unfinished housing estates prescribed in 2013 by the then Minister for the Environment, Community and Local Government are currently exempt from the payment of local property tax (LPT).
As with any other LPT exempt property, a property in an unfinished estate that was exempt on the first valuation date of 1 May 2013 will not become chargeable until the next valuation date i.e. 1 November 2019. The exemption is retained even where a property, or the estate in which it is situated, is completed to a local authority's satisfaction and used for residential purposes prior to that date.
The originally projected valuation date of 1 November 2016 was deferred to 1 November 2019 by the Finance (Local Property Tax) (Amendment) Act 2015.
79. Deputy Pearse Doherty asked the Minister for Finance the status of the liquidation process at IBRC including a list of all groups of creditors; the likelihood that they will be paid; and the likely financial result for the state. [33903/16]
View answerThe status of the Special Liquidation as at 31 December 2015 is set out in a third progress update report published by the Special Liquidators on 27 May 2016 and which is available on the Department of Finance website through the following link:
http://www.finance.gov.ie/sites/default/files/Progress%20update%20report_31%20Dec%202015.pdf.
There remains a number of tasks in the liquidation to be completed including the ongoing management of c. 350 legal cases, the completion of the creditor adjudication process, the work with the Commission of Investigation, the management of the remaining loan book of c. €3.7bn, the liquidation of the remaining subsidiaries, the realisation of all remaining assets and the completion of various projects which include the Interest Overcharge Remediation Project.
As the Deputy is aware, in relation to the payment of proceeds from the liquidation, each class of creditor will be paid according to their legal priority as set out in the Companies Acts, with costs and expenses of the liquidation ranking first followed, in order, by preferred creditors, senior unsecured creditors and subordinated debt creditors. All of the preferential creditors have been paid in full. As previously advised in the IBRC Progress Update Report of May 2016 it is expected that an interim dividend of 25% will be paid to all admitted unsecured creditors by 31 December 2016.
I am advised by the Special Liquidators that their expectation, based on current information, is that the eventual unsecured creditor dividend will be in the range of 75% - 100% of all eligible claims. The Special Liquidators further advise me that this eventual dividend range is subject to change depending on future events which are outside their control. The ultimate level of dividend paid to each creditor cannot be known until such time as all loan assets are sold, the total level of adjudicated creditors is finalised and the other contingent creditor claims which may crystallise, including those from litigation, are known.
The likely financial result for the State is not yet known as it will be dependent on the ultimate level of dividend available.
80. Deputy Catherine Murphy asked the Minister for Finance further to Parliamentary Questions Nos. 110 and 111 of 2 November 2016, if he will consider the introduction of a method to record the information returned in VAT returns to include the identification of the yield from a particular activity and or product; and if he will make a statement on the matter. [33904/16]
View answerI am advised by Revenue that all businesses are required to indicate their sector and activity type using the EU-standard NACE Code at the time of tax registration, but are not required to provide this information on each VAT Return. However, traders are required to update their NACE Code should their activity type change. In terms of introducing a mandatory sectoral breakdown of trading information in the VAT returns made by traders, the value of such data needs to be balanced against the administrative burden for business that would be involved and the reliability of the allocations made by traders in their returns.
81. Deputy Jack Chambers asked the Minister for Finance the process required for an international bank to acquire a licence to operate here; the length of time the process takes; if consideration has been given to speeding up this process and creating a shorter waiting time than is in place in other jurisdictions to attract more foreign direct investment; and if he will make a statement on the matter. [33920/16]
View answerThe Central Bank operates as part of a European system of regulation and standards. The authorisation process is broadly consistent across the European Union and entirely consistent within the eurozone. Post 'Banking Union', the European Central Bank ('ECB') is the competent authority in Ireland for the granting of banking licences in accordance with Section 9 of the Central Bank Act, 1971 (as amended). The Central Bank has published Guidelines on its website to assist those wishing to submit an application for a Banking Licence under Section 9 of the Central Bank Act 1971.
The principal stages in the authorisation process are as follows:
- Exploratory Phase - During this phase the potential applicant will submit a proposal to the Central Bank for review. The Central Bank will undertake a detailed review of the proposal and issue comments advising the applicant of any further information or clarifications required in relation to any aspect of the proposal. The purpose of the review is to determine whether the proposal will meet the required standard for authorisation. The Central Bank will, having conducted an initial assessment, notify the ECB of receipt of the proposal and provide all required information to enable it to commence its assessment of the proposal;
- Formal Application - Should the proposal meet the required standard, the applicant will then submit an application for authorisation. Both the Central Bank and the ECB will complete their assessment of the application which may involve further clarification being sought from the applicant. At the end of this stage the Central Bank will determine whether to recommend to the ECB that authorisation be granted;
- ECB Decision - Decision by the ECB on whether to grant a banking licence - A banking licence will only be granted where the ECB and the Central Bank are satisfied that the applicant complies with the authorisation requirements. The robustness of the discharging of our gatekeeping role is critical to the protection of consumers and maintenance of financial stability.
In relation to applications for authorisation under Section 9A of the Central Bank Act, 1971, referred to as 'Third Country Branches' (i.e. where the applicant is a credit institution whose head office is located in a state or territory other than an EEA state and which holds an authorisation to carry on banking business in that state or territory from the authority that exercises in that state or territory functions corresponding to those of the Bank), the Central Bank is the competent authority for granting such authorisations.
The principal stages are the same as for section 9 authorisations, set out above, with the exception that there is no ECB involvement in the assessment and the decision on authorisation is made solely by the Central Bank. The Central Bank has published a Policy Statement on the authorisation of Third Country Branches.
The total time for licensing will depend upon:
- the quality of the proposal submitted by the applicant;
- the nature, scale and complexity of the proposed business model;
- the time taken by the applicant to respond to comments raised on each draft of the proposal and application;
- the quality of the responses received addressing all issues raised;
- any changes made by the applicant to its proposal during the authorisation process; and
- the time taken by any relevant third parties to respond to queries in relation to the application.
The Central Bank has informed me that once a full, completed application is received and accepted, the assessment process is commenced without delay but in practice, the authorisation process takes many months of engagement, discussion and back and forth on key issues before the application is completed. So measuring on this basis we can expect a time horizon of probably at least a year.
When it comes to applications for licences in Ireland, the Central Bank assures me that it stands ready to meet the challenges that may arise. The Central Bank will do so on the basis of an active, open stance, ready to engage, but in line with their duty to protect consumers, and in keeping with EU rules, international standards, and our published processes.
82. Deputy Sean Fleming asked the Minister for Finance if companies involved in the wind energy industry can avail of the section 110 regime under the Finance Act; and if he will make a statement on the matter. [33941/16]
View answerI am informed by Revenue that in order to avail of relief under section 110 of the Taxes Consolidation Act 1997, a company must be a qualifying company within the meaning of that section.
Amongst the conditions of a qualifying company is that it must hold or manage qualifying assets.
Since the enactment of Finance Act 2003, a qualifying asset is defined as an asset which consists of, or of an interest in, a financial asset, and financial asset is defined as:-
- shares, bonds, and other securities;
- futures, options, swaps, derivatives and similar instruments;
- invoices and all types of receivables;
- obligations evidencing debt (including loans and deposits);
- leases and loan and lease portfolios;
- hire purchase contracts;
- acceptance credits and all other documents of title relating to the movement of goods;
- bills of exchange, commercial paper, promissory notes and all other kinds of negotiable or transferable instruments.
Finance Act 2008 amended the definition of qualifying asset to an asset which consists of, or of an interest (including a partnership interest) in a financial asset, and added to the list of financial assets:-
- greenhouse gas emissions allowance and
- contracts for insurance and contracts for reinsurance.
Finance Act 2011 extended the definition of qualifying asset to include commodities and plant and machinery.
However, the generation of green energy is not the holding or managing of a qualifying asset and therefore it is not an activity which a qualifying company can carry on.
83. Deputy Martin Heydon asked the Minister for Finance if he will provide a breakdown of the number of first-time buyers per annum who have availed of the deposit interest retention tax refund scheme for first-time buyers since its introduction; the average amount of refund payable for each of those years; and if he will make a statement on the matter. [33947/16]
View answerI am advised by Revenue that applications for refunds of Deposit Interest Retention Tax (DIRT) for first-time buyers who purchase a house or apartment to live in as their home are as follows (scheme began on 14 October 2014);
|
- |
Number of applications approved. |
Amount refunded |
|
14/10/14-31/12/15 |
126 |
€137,241 |
|
1/1/16-7/11/16 |
380 |
€299,557 |
|
Totals to date |
506 |
€436,798 |
I am also advised that, 102 applications have been refused to date and 80 are currently being processed.
84. Deputy Bernard J. Durkan asked the Minister for Finance the extent to which the Revenue Commissioners have to date facilitated the restructuring of a business in the case of persons (details supplied) having particular regard to the efforts being made by the persons to meet their targets and in view of the fact that their agents have indicated an improvement in the business in the context of which it should be possible to enter into an agreement acceptable to the Revenue Commissioners and the proprietors and with particular reference to the need to maintain the employment associated with the business; and if he will make a statement on the matter. [33969/16]
View answerI previously referred to this case in my reply to Parliamentary Question No. 134 of 4 October 2016.
As advised in my reply, it was not possible for Revenue to agree any phased payment arrangement with the business at that time because there were a number of returns outstanding and the full extent of the debt could not be quantified.
The business subsequently filed the outstanding returns and a phased payment arrangement was agreed on 6 October 2016. The arrangement was agreed on the understanding that all future taxes would be paid on a timely basis and all returns filed as they became due.
Revenue has advised me that the taxpayer has not adhered to the conditions of the arrangement and no payments in respect of current taxes have been received to date despite assurances given in the context of a business restructuring. Revenue has also advised me that where payments were received, they were returned unpaid and as a consequence the debt has continued to increase.
The continuing failure of the business to meet its tax obligations and in particular to pay current taxes as they fall due left Revenue with no option but to recently deploy debt collection/enforcement action to secure the outstanding liabilities.
Before Revenue can consider any change to its debt collection/enforcement action, the business needs to immediately honour the recent cancelled payments and to fully commit to the terms of the phased payment arrangement.
85. Deputy Noel Grealish asked the Minister for Finance the length of time a vehicle from Northern Ireland can be in this State without crossing back over the Border before the VRT process starts; and if he will make a statement on the matter. [33980/16]
View answer86. Deputy Noel Grealish asked the Minister for Finance if it is illegal for a resident here to drive a car on loan from a garage in Northern Ireland while repair work is being carried out on their own car which is taxed and registered in the South; and if he will make a statement on the matter. [33981/16]
View answerI propose to take Questions Nos. 85 and 86 together.
I am advised by Revenue that a State resident that brings a foreign registered car into the State is legally obliged to make an appointment to register the car within seven days and to have it registered within thirty days from the date the car is first brought into the State. This rule applies whether the person resident in the State has bought the car in question or has the loan of the car from a garage or from some other source.
87. Deputy Brendan Griffin asked the Minister for Finance his views on a matter (details supplied) regarding first-time buyers; and if he will make a statement on the matter. [33989/16]
View answerThe commencement date for the Help to Buy scheme of 19 July 2016 was chosen as it was the date of the launch of 'Rebuilding Ireland - Action Plan for Housing and Homelessness', in which the development of such a scheme for inclusion in the Budget was initially announced. The intention to backdate this tax incentive to this date was announced at that time with a view to avoiding any potential interruption in house sales by purchasers who may otherwise have deferred purchases, pending the commencement of the incentive.
I have no plans to backdate the scheme prior to 19 July as to extend eligibility for the scheme further back than the date of its initial announcement would consist entirely of deadweight. One of the primary policy aims of the incentive is to assist those struggling to save for the deposit required in purchasing a house. Individuals who purchased new homes since the start of the year did not need the assistance of the State to fund the required deposit. Such individuals made their purchasing decisions on the basis of the information available to them at the time of purchase, and could not have expected a subsequently introduced tax relief to also be available to them.
As with all time bound reliefs, there will always be those who just miss out on qualification. I do not intend to extend the parameters of this new measure any further as it would become less targeted and more costly.
88. Deputy Billy Kelleher asked the Minister for Finance if he will consider a VAT exemption for underage sports teams on the purchase of equipment and uniforms to assist with the financial burdens of these volunteer clubs and to assist with encouraging a healthier lifestyle for children; and if he will make a statement on the matter. [34004/16]
View answerI am advised by Revenue that the VAT rating of goods is governed by the EU VAT Directive (Council Directive 2006/112/EC), with which Irish VAT law must comply. The Directive provides that the supply of sports equipment and uniforms is generally subject to the standard rate of VAT, regardless of who the purchaser is.
However, under Article 110 of the Directive, Ireland has retained the application of the zero rate of VAT to the supply of children's clothing and footwear, which does not exceed the size appropriate to children of average build and average foot size of 10 years of age, including sports uniforms and sports footwear.
As Ireland applied the zero rate to clothing and safety equipment for children up to 11 years of age on 1 January 1991, we are entitled to retain that zero rated application. However, as the standard VAT rate applied to clothing and footwear for adults and older children at 1 January 1991, it is not possible to apply a reduced or zero rate to them.
89. Deputy Sean Fleming asked the Minister for Finance if he will provide a list of all contingent assets in his Department and in agencies under his Department where amounts can be owed but are not listed in the national accounts as an asset; if he will further provide a full breakdown of each category of contingent assets and the estimated amounts in the category; and if he will make a statement on the matter. [34076/16]
View answerWhile contingent assets are provided for in international accounting standards, they only apply to entities that use the accruals basis of accounting. The vote for my Department and the other votes within the Finance Vote group are accounted for in the annual Appropriation Accounts on a cash basis, in accordance with the Exchequer and Audit Departments Act, 1866. Notes to the annual accounts are provided on foot of policies specified in Public Financial Procedures and in the circulars issued by the Department of Public Expenditure and Reform. Likewise, the Finance Accounts, which is the account of the Central Fund, and the Annual Account of Taxes and Duties collected, which is produced by the Revenue Commissioners, follow the cash basis of accounting. In accordance with these accounting requirements, there is no reporting in relation to contingent assets. Information in relation to the Central Bank of Ireland is not to hand. I will forward it to the Deputy as soon as possible. In the case of the Irish Bank Resolution Corporation, there are potential recoveries depending on the outcome of litigation, but it is not possible at this time to make an accurate estimate of the amounts involved. In regard to the other agencies under my Department that are required to use the accruals basis of accounting, I am advised that they do not have any contingent assets that must be accounted for under the relevant accounting standards applying to them. The national accounts are prepared by the Central Statistics Office under rules set out in the European System of Accounts (ESA 2010).
The referred reply under Standing Order 42A was forwarded to the Deputy.
90. Deputy Gino Kenny asked the Minister for Finance the number of aircraft leasing companies that have obtained a trading treatment for leasing activities; the number that have obtained trading treatment for a single leasing activity; and if he will make a statement on the matter. [34043/16]
View answerI am advised by the Revenue Commissioners that as of September 2016, 2,660 companies were assigned to the primary industry description (NACE code) of renting and leasing of air transport equipment.
As information on the number of leases entered into by air transport equipment leasing companies is not required to be entered on corporation tax returns, it is not possible to provide information on the number of such companies that have entered into a single lease.
91. Deputy Bríd Smith asked the Minister for Finance his views on the last minute expansion of the so-called fiscal space by some €300 million for the 2017 budget and its implications for next year's spending; and if he will make a statement on the matter. [30932/16]
View answerThe increase in the fiscal space between the amount forecast in the Summer Economic Statement (SES) 2016 and final amount in the Budget 2017 document was some €200 million, not €300 million.
The €1 billion fiscal space in the Summer Economic Statement (SES) was funding a proposed Budget package of €1.2 billion in 2017 consisting of additional expenditure worth €860 million and tax reductions worth €330 million. A Budget package worth more than the available fiscal space is possible due to the effect of four-year capital smoothing, where only one quarter of the increase in capital expenditure must be funded in the first year from within the fiscal space.
The final Budget package announced for 2017 was worth €1.3 billion, so the additional increase vis-à-vis the SES was €100 million.
The actual package consisted of net tax reductions worth €295 million and additional spending worth €1 billion. This consisted of about €800 million for current spending and €200 million for capital spending.
The difference between the €200 million increase in fiscal space and the €100 million package increase between the SES and the Budget arises because the Government increased capital expenditure this year by €200 million, to address flood damage and school building, utilising €50 million of the fiscal space available for 2017 and the split between current and capital increases was altered.
Finally I would point out that the 'walk' from €1 billion to €1.2 billion of fiscal space is described in Box 1 "Evolution of 'fiscal space' in 2017" in Chapter 3 of the Economic and Fiscal Outlook section of the Budget 2017 book.
92. Deputy Bríd Smith asked the Minister for Finance the strategic risks identified by him in the draft national risk assessment report in relation to tax issues and multinational corporations based here. [31824/16]
View answerThe National Risk Assessment (NRA) is an annual horizon scanning exercise in which broader risks to Ireland's well-being are assessed. It takes into account risks from an economic, environmental, geo-political, social and technological perspective to take a holistic view of all potential areas of risk. The NRA finds that the main risks in Ireland in 2016 relate to Brexit/uncertainty over the UK's relationship with the EU, weakening global economic growth, infrastructural deficits, international terrorism and expenditure pressures.
The Department of Finance inputs into this national exercise in respect of economic risks.
Section 2 of the NRA deals with Economic Risks and section 2.3 examines the issues around the importance of multinational corporations to the Irish economy and the risk of unfavourable international tax changes.
The document recognises that Ireland's economy and employment are heavily dependent on a relatively small number of multinational corporations concentrated in a small number of enterprise sectors.
The identified risks in relation to tax issues and multinational corporations simply reflect reality. The Taoiseach has stated that: "the Draft National Risk Assessment 2016 sets out risks for public consultation. They are complex and demand a considered policy response. By being open about these risks, we hope we can have a mature debate about these challenges and their implications for Ireland".
The Corporation Tax receipt profile is kept under ongoing review by the Department of Finance, in conjunction with the Revenue Commissioners, and it is one of the issues covered by the National Risk Assessment is the receipt profile of various tax heads.
The NRA was recently published by the Department of An Taoiseach and is available at the following link - http://www.taoiseach.gov.ie/eng/Publications/Publications_2016/Draft_National_Risk_Assessment_2016_%E2%80%93_Overview_of_Strategic_Risks.html.
93. Deputy Mick Wallace asked the Minister for Finance the number of empty, completed or unfinished residential units which have been sold by NAMA here to date; the average price received for finished and unfinished units respectively; and if he will make a statement on the matter. [28642/16]
View answer94. Deputy Mick Wallace asked the Minister for Finance the construction companies which have been employed by NAMA to date in their building operations; the average cost per unit; and the way in which this compares with the cost of local authority builds. [28643/16]
View answerI propose to take Questions Nos. 93 and 94 together.
As the Deputy is aware NAMA has acquired loans from the five participating institutions and is not the owner or manager of properties. The Agency's role is, like a bank, that of a secured lender. Other than properties that have been enforced, all of which are listed on NAMA's website and which are managed by the appointed receivers/administrators, properties continue to be managed by their existing owners.
Like a bank, as a secured lender NAMA does not develop, manage or rent/sell properties. Accordingly, the information that the Deputy has sought is not applicable to NAMA because NAMA does not employ or engage construction companies and NAMA does not sell residential properties.
Information on NAMA's financial performance and on other aspects of its operations, including the provision of development funding for commercially viable residential and commercial development projects, is provided in its quarterly and annual financial statements, all of which are available on the NAMA website, www.nama.ie.
95. Deputy Mick Wallace asked the Minister for Finance his plans to introduce a tax on residential properties left vacant for over a year in areas of high housing demand, as is the case in Scotland, England and France; and if he will make a statement on the matter. [28639/16]
View answerI have no plans to introduce a tax along the lines suggested by the Deputy.
The Finance (Local Property Tax) Act 2012 as amended provides that residential properties that are suitable for use as a dwelling are generally liable to the local property tax, whether or not they have been left vacant. However, properties that are not suitable for use as a dwelling, and are not occupied as such, for example, because they are in a serious state of dereliction, are not liable to this tax.
Implementing an increased rate of tax along the lines suggested by the Deputy would present practical and perhaps legal difficulties in the identification of genuinely empty properties. In any event, as the full rate of Local Property Tax already applies to vacant residential properties in Ireland it is thought that this should provide sufficient encouragement for property owners to ensure they are not left vacant indefinitely.
96. Deputy Paul Murphy asked the Minister for Finance his views on the relatively low increase in the income tax take in 2016 despite the rise in employment; his views on whether this points to the need to increase wages of low and middle income workers; and if he will make a statement on the matter. [34042/16]
View answerBudget 2016 estimated that overall income tax receipts for 2016 would amount to €18,995 million, which represents a 4.4% year-on-year increase. Budget 2017, published last month, also projected annual growth in income tax for 2016 of 4.5%, with receipts of €19,185 million expected. This is an additional €190 million above the Budget 2016 estimate for this tax head.
Looking at the performance in the year-to-date, income tax receipts to end October 2016 are currently up 4.2% or €577 million year-on-year, but 0.6% or €94 million below profile. The performance of DIRT in 2015 was disappointing and this has continued in 2016 following lower-than-expected interest rates with receipts from this sub-component now c. €130 million below profile. Removing the impact of DIRT receipts from the income tax performance in the year-to-date would show overall receipts marginally ahead of profile, with almost one quarter of the annual income tax receipts profiled for the last two months of the year.
This indicates that the main elements of income tax continue to show robust year-on-year growth rather than a "relatively low increase" that the Deputy refers to.
As regards wage levels of low and middle income workers, I would remind the Deputy of the importance of safeguarding our competitiveness, particularly in light of the uncertainty presented by Brexit. In this regard, the Deputy will be aware of the significant depreciation of sterling over the past year or so, and the impact that this is having on our competitiveness. In order to protect jobs and prevent an increase in unemployment, it is paramount that wages move in line with productivity. Finally, I would highlight that inflation has been virtually non-existent this year, which is helping to protect real wages.
