Written Answers Nos. 182-195
182. Deputy Brendan Griffin asked the Minister for Finance the amount of revenue which would be generated annually with an increase of 1 cent in excise duty on fuel, alcohol and cigarettes, in tabular form; and if he will make a statement on the matter. [34760/16]
View answerI am advised by Revenue that a Post Budget 2017 Ready Reckoner is available on the Revenue Statistics webpage at http://www.revenue.ie/en/about/statistics/ready-reckoner.pdf.
In relation to the Deputy's questions, this Ready Reckoner shows a wide range of detailed information, including Excise increases on fuel, alcohol and tobacco. While the Ready Reckoner does not show all of the specific costings requested by the Deputy, others can be estimated from those shown on a pro-rata or straight line basis with those displayed in the Reckoner.
183. Deputy Niall Collins asked the Minister for Finance the position which applies in a circumstance (details supplied); and if he will make a statement on the matter. [34796/16]
View answerSection 21 of the Credit Union Act, 1997 provides for the nomination of property in a credit union. The legislation specifies that a credit union member aged 16 or over, can nominate in writing a person or persons to become entitled to all or part of the member's property in the credit union at the time of the member's death, up to a prescribed limit. It also provides for the member to vary or revoke their nomination.
It would not be appropriate for me to comment on the specific issue raised in the question as this would involve an interpretation of the law, which is a matter for the courts.
184. Deputy Niamh Smyth asked the Minister for Finance if he is considering proposals (details supplied) by farming organisations regarding the Finance Bill 2016; and if he will make a statement on the matter. [34906/16]
View answer188. Deputy Mary Butler asked the Minister for Finance if he will consider delaying the date for commencement of the amendment specifically regarding the restriction of flat rate addition, section 46 of the Finance Bill, which is due to come into operation on 1 January 2017 (details supplied); and if he will make a statement on the matter. [35136/16]
View answerI propose to take Questions Nos. 184 and 188 together.
Section 46 of the Finance Bill provides for a restriction of the flat-rate scheme for farmers with effect from 1 January 2017. The amendment gives the Minister for Finance the power to make an order excluding particular agricultural goods or agricultural services from the flat-rate addition scheme. This power can be exercised where Revenue has carried out a review and the Minister for Finance is satisfied that, because of the business structures, contractual arrangements or models in place in a particular sector, the application of the flat-rate addition within that sector has resulted in, and would otherwise continue to result in, a systematic excess of flat-rate addition payments over VAT on inputs incurred by flat-rate farmers in that sector.
As the measure being introduced by Section 46 is an enabling provision, it is not necessary to delay its implementation as suggested. The review by Revenue will provide an opportunity for the sector under review to change its structures as necessary and there is no specified time in which the Minister for Finance must decide on restrictions to the flat-rate scheme. The Minister for Finance will have the ability to delay signing an Order to restrict the flat-rate addition, if he believes that the effected agricultural sector are rearranging their business structures, contractual arrangements or models to provide that no systemic excess of flat-rate addition payments will incur.
185. Deputy Catherine Murphy asked the Minister for Finance his views on whether the 9% VAT rate may be considered as state aid in view of the fact that it gives a select number of sectors a competitive advantage. [34911/16]
View answerVAT rating is governed by the EU VAT Directive (2006/112/EC), with which Irish VAT law must comply. Article 98 of the EU VAT Directive allows Member States to apply up to two reduced VAT rates of no less than 5% to any of the goods or services listed in Annex III of that Directive. The 9% VAT rate applicable in Ireland to the supply of certain goods and services related to the tourist industry complies with Article 98 and Annex III of the EU VAT Directive, as all the goods and services to which the 9% applies are listed in Annex III. Where the application of a VAT rate is in compliance with the EU VAT Directive, it is compatible with the proper functioning of the internal market and cannot be considered to constitute a form of State Aid.
186. Deputy Brendan Griffin asked the Minister for Finance if he will consider the introduction of a tax-free allowance for landlord's rental income in line with rent supplement caps; and if he will make a statement on the matter. [35005/16]
View answerI assume that the Deputy's proposal would envisage a tax free allowance for rental income received from a tenant in receipt of rent supplement, and not a general tax free allowance for all residential landlords in respect of rental income from all tenants in line with rent supplement caps.
To introduce a tax exemption for rental income received in line with rent supplement caps would, in effect, see the State provide a double subsidy: first to the tenant who is in receipt of the housing support, and second to the landlord who receives the income tax-free. Such an incentive could also give rise to distortions in the housing market. It would incentivise landlords to only accept tenants in receipt of rent supplement, and as a consequence put increased pressure on tenants currently renting in the private market, which could potentially result in increased need for social housing supports. It could also create particular difficulties for tenants who transition out of rent supplement for example as a result of gaining employment or increased income as their landlord would be incentivised to end the tenancy in order to continue renting to a person in receipt of rent supplement.
The Deputy may be aware that last year in Budget 2016 I introduced a new incentive to encourage landlords to commit to letting their property to tenants in receipt of social housing supports for a minimum period of three years. The incentive acts by allowing such landlords to claim a deduction for 100% of qualifying mortgage interest relief, in place of the 75% deduction which currently applies in respect of rented residential property in general. This was introduced as a time-limited measure, specifically targeted to improve certainty of supply of rental housing for such tenants.
In Budget 2017, as part of a package of measures designed to support housing supply, I announced that a full 100% deduction of qualifying interest for all residential landlords will be restored. However in order to preserve the current incentive for landlords to house tenants in receipt of social housing supports, full deductibility for other landlords is being restored on an incremental basis over the next 5 years.
It is my view that these measures are more appropriate than a tax free allowance of the nature proposed by the Deputy.
187. Deputy John Brassil asked the Minister for Finance his views on an opinion expressed by a co-op (details supplied). [35009/16]
View answerIn Budget 2017, I announced the exemption from carbon tax for fuel used to create high efficiency electricity in combined heat and power plants. The dual process of using energy to create usable heat and power is regarded as a highly efficient energy process and makes use of the heat produced in the electricity generation instead of releasing it into the atmosphere. The rationale for providing a full relief from carbon tax for the fuel inputs is to incentivise the use and development of this highly efficient technology, thereby contributing to reducing Ireland's emissions particularly in the context of our binding 2020 emission targets in both the heat and energy sectors. This measure is also designed to facilitate the use of biomass CHP as a renewable power source, further building on the Renewable Energy Feed-in Tariff which has been in place since 2012. The relief will be based on certification by the Commission for Energy Regulation that the fuel used has been to generate high-efficiency electricity.
I also announced in Budget 2017 the commencement of the carbon tax relief for biomass content of solid fuel which was legislated for in Finance (No. 2) Act 2013. The measure is designed to incentivise alternatives to fossil fuel and stimulate the market for low carbon fuel. The introduction of two thresholds provides an incentive to develop blended solid fuels with a higher biomass content. To further the environmental rationale, this relief is available only for low smoke solid fuels.
189. Deputy Tom Neville asked the Minister for Finance if he will address the issues raised in correspondence (details supplied) in relation to stay-at-home parents who are facing financial discrimination. [35152/16]
View answerThe system of individualisation has been in the tax code since 1999, and is now integral to the overall system. When first announced, the stated purposes of individualisation were, essentially, to ease the burden on single persons (65% of the work force), to take workers on the average industrial wage out of the higher rate of tax and more generally to facilitate a reduction in the numbers paying tax at the higher rate. Prior to this, a second spouse faced the marginal rate of tax on the first euro (or Punt as it was then) earned in his or her own name.
Individualisation was progressed to some extent in later years but never completed. The result is that we now have a hybrid system. Up to €9,000 of the standard-rate band can be transferred between spouses and the full married personal tax credits, can be allocated in full to one spouse. Because the income tax system allows married couples to choose whether to be jointly or individually assessed, there can be a difference between the tax liabilities incurred by married couples on the same household income, depending on the method of assessment chosen.
However, it is important to stress that married one-earner couples on average earnings are not affected by the different standard rate bands under the current structure as the married one-income band standard rate band of €42,800 is in excess of the current average wage. Furthermore, the €9,000 transferable standard rate band, which married one earner couples can avail of, reduces their income tax liability to around half that incurred by a single individual earning a similar income.
The difference in treatment for couples depending on whether one or both work may be attributed, at least in part, to the fact that there are costs associated with earning an income, such as travel and childcare costs. Such costs are likely to be greater if two persons, rather than one person, work outside the home to earn the same gross income.
It is my view that individualisation has now bedded into the tax system to a degree where it cannot be changed easily, and there are no plans to do so. It was estimated last year that to complete or to reverse individualisation would cost in the region of €800 million. Such a cost, if it related to the reversal of individualisation, would result in an increased burden of taxation on other cohorts of taxpayers including single parent families and single individuals.
However, you may be aware that a Home Carer Tax Credit may be claimed where one spouse works primarily in the home to care for a dependent person, such as a child or an elderly relative. This credit was introduced in the context of the move towards individualisation of the tax system, in recognition of the choices made by families where one spouse stays at home to care for children or the elderly. In the recent Budget, I announced an increase in this credit from €1,000 to €1,100 per year, effectively allowing the credit to shelter family income of €5,500 from taxation. This follows on from last year's Budget where the credit was increased from €810 to €1,000.
The constitutionality of the various provisions of the tax code are ultimately a matter for the courts to decide, where issues are put before them. However, I would point out that due regard is given to the provisions of the Constitution when constructing the tax code.
The issue of tax individualisation was considered by the Commission on Taxation in 2009 and that body recommended no change should be made to the current system. It concluded that the current system represents a balance between, on the one hand, acknowledging the choices families make in caring for children and, on the other, taking account of the need to encourage labour market participation.
As regards future measures, in the Programme for a Partnership Government there is a commitment to ask the Oireachtas to continue to phase out the USC as part of a wider medium-term income tax reform plan that keeps the tax base broad, reduces excessive tax rates for middle income earners, and limits the benefit for high earners. The changes introduced in the last three Budgets have commenced reducing the income tax burden with an emphasis on low and middle income earners, and it is my intention to continue this process in future Budgets, as fiscal resources allow.
In relation to childcare, this is primarily a matter for my colleague, the Minister for Children and Youth Affairs in the first instance. Minister Zappone has announced the introduction of a new Affordable Childcare Scheme which will be available to all families both single income and double income. It is important to recognise that the Affordable Childcare Scheme is only one element of a broader set of commitments and supports aimed at parents and children. The provision of improved services for centre-based care is very important, as also are the needs of children who do not attend such services.
In this regard, Better Outcomes Brighter Futures: The National Policy Framework for Children and Young People contains a commitment to produce Ireland's first-ever National Early Years Strategy. The intention is to deliver a cross-cutting strategy which will take a joined-up, whole of Government approach to the issue of supporting children and their families during the early years (0-6 years). The drafting of the National Early Years Strategy is at an advanced stage and the Department of Children will hold an Open Policy Debate on the strategy before the end of the year with a view to publication shortly thereafter. Minister Zappone and her Department are open to hearing views about supports for parents raising children at home.
190. Deputy Willie Penrose asked the Minister for Finance the status of an investigation by the European Commission (details supplied); and if he will make a statement on the matter. [35154/16]
View answerMy Department and the Revenue Commissioners have a legal obligation to protect taxpayer confidentiality and due to the small number of taxpayers involved in this particular sector, they are precluded from commenting on the matter.
I would point out, however, that Section 46 of the recently published Finance Bill provides for a restriction of the flat-rate scheme with effect from 1 January 2017. The amendment gives the Minister for Finance the power to make an order excluding particular agricultural goods or agricultural services from the flat-rate addition scheme. The power can be exercised where the Revenue Commissioners has carried out a review and the Minister is satisfied that, because of the business structures, contractual arrangements or models in place in a particular sector, the application of the flat-rate addition within that sector has resulted in, and would otherwise continue to result in, a systematic excess of flat-rate addition payments over VAT on inputs incurred by flat-rate farmers in that sector.
191. Deputy Brendan Smith asked the Minister for Finance the measures he proposes to implement to deal with the escalating costs of insurance premiums; if his attention has been drawn to the fact that there have been unacceptable increases in insurance costs for some sectors such as licensed premises; his views on the survey carried out by an organisation (details supplied) showing that 37% of publicans had encountered difficulties in securing insurance cover for their premises and the substantial increase in insurance costs for the majority of such premises; and if he will make a statement on the matter. [35189/16]
View answerAs Minister for Finance, I am responsible for the development of the legal framework governing financial regulation. Neither I nor the Central Bank of Ireland, can interfere in the provision or pricing of insurance products, as these matters are of a commercial nature, and are determined by insurance companies based on an assessment of the risks they are willing to accept.
This inability to intervene in such matters is reinforced by the EU framework for insurance which expressly prohibits Member States from adopting rules which require insurance companies to obtain prior approval of the pricing or terms and conditions of insurance products.
However, I do accept that it is possible for the State to play a role in helping to stabilise the market. Consequently, I established the Cost of Insurance Working Group and appointed Minister of State Eoghan Murphy as Chair. The initial focus of the Working Group is on the factors that are contributing to the cost and availability of motor insurance and identifying what short-term, medium-term and long-term measures can be introduced to help consumers and businesses.
It is likely however that because of some of the common factors underlying all insurance lines that many of the recommendations being considered will also address the difficulties being experienced in the cost and availability of other types of insurance, including public liability insurance.
The Working Group has met with a number of stakeholders during the course of its work, including the representative body that the Deputy refers to. This consultation included a presentation of to the Minister for State of its survey findings.
Finally, it should be noted that at the end of October 2016, the Working Group provided me with an initial set of emerging recommendations. Since then, the Working Group has been working to finalise the Report and developing an action plan to enable the relevant Government Departments and Offices to commence the implementation of agreed priority actions. The report and action plan will detail any legislative or regulatory changes that may be required and will include a detailed timeline for implementation.
192. Deputy Brendan Smith asked the Minister for Finance if his attention has been drawn to the increasing concerns of contractors within the construction sector in relation to the procurement of public contracts due to unfair competition from contractors, particularly from Northern Ireland, which have a lower cost base and continue to gain further advantage with the procurement of building materials and labour in Northern Ireland due to the weakness of sterling; if contractors, regardless of their base, are obliged to pay the statutory labour rates here along with other statutory taxes and levies; and if he will make a statement on the matter. [35190/16]
View answerI would like to assure the Deputy that I am aware of the ongoing issues in the construction sector including the challenges faced by contractors. However, as regards procurement, under EU law, public contracts above certain values must be advertised EU-wide and awarded to the most competitive tender in an open and transparent process. The aim is to promote an open, competitive and non-discriminatory public procurement regime which delivers value for money. It would be a breach of the rules for a public body to favour or discriminate against particular candidates on grounds of location or nationality and there are legal remedies which may be used against any public bodies for infringing these rules.
With regards to statutory labour rates, all workers posted to Ireland from another EU Member State have the protection of all Irish employment rights legislation in the same way as employees who have an Irish contract of employment. Therefore, once it is clear that a person is working in the State under a contract of employment, on a full-time or part-time basis, that person is entitled to be paid the statutory wage rate applicable under Irish law.
I am advised by the Revenue Commissioners that non-resident contractors are obliged to register for and pay relevant taxes for activities carried out in the State. This includes, Relevant Contracts Tax, Value Added Tax, Employers PAYE and depending on the circumstances income tax or corporation tax.
Relevant Contracts Tax
Relevant Contract Tax (RCT) applies to payments to subcontractors on construction, meat processing and forestry operations carried out within the State. Relevant contracts must first be registered on Revenue's eRCT system and principals must subsequently notify Revenue of all payments to subcontractors made on relevant contracts via Revenue's e-RCT system.
RCT applies irrespective of whether the Principal or subcontractor or both are resident outside the State. If the work is being carried out in the State, RCT must be operated.
VAT
All non-resident principal contractors (individuals, partnerships and companies) who are engaged in Relevant Contracts in the construction industry in the State must register for VAT and account for VAT under the VAT reverse charge rule.
Employers PAYE
All employers, including non-resident employers, must register for PAYE as an employer and operate PAYE/PRSI/USC in respect of income attributable to the performance in the State of an employment.
Income Tax/Corporation Tax
A non-resident contractor which has a permanent establishment which lasts for more than 6 months is liable for income Tax if a sole trader or corporation Tax if a company, on the profits arising from the Permanent Establishment.
Under Ireland's Double Taxation Agreements the term "Permanent Establishment" expressly includes a building site or construction or installation project.
193. Deputy John Brady asked the Minister for Education and Skills the reason a person (details supplied) who is a medical card holder is not eligible to receive free school transport for their children and therefore it costs them a significant €700 per annum for their children to travel from their home to their school; and if he will make a statement on the matter. [34416/16]
View answerSchool transport is a significant operation managed by Bus Éireann on behalf of the Department.
Currently over 113,000 children, including some 10,000 children with special educational needs, are being transported in approximately 4,000 vehicles on a daily basis to primary and post-primary schools throughout the country covering over 100 million kilometres annually.
In general, children are eligible for school transport if they are attending their nearest school and satisfy the requisite distance criteria.
In this regard Bus Éireann has confirmed that the children in question are not attending their nearest school and are therefore not eligible for school transport.
Children who are not eligible for school transport may apply for transport on a concessionary basis only.
Transport on a concessionary basis is subject to a number of conditions which are detailed in the School Transport Scheme such as the existence of spare seats on the bus after all eligible children have been catered for and payment of the school transport charge. Only children who are eligible for school transport and who hold valid Medical Cards (GMS Scheme) are exempt from paying the annual charge. The maximum annual family charge for school transport is €650.
The terms of the School Transport Scheme are applied equitably on a national basis.
194. Deputy Michael Healy-Rae asked the Minister for Education and Skills the status of an application for assisted technology in respect of a person (details supplied); and if he will make a statement on the matter. [34533/16]
View answerI wish to advise the Deputy that the National Council for Special Education (NCSE), through its network of local Special Educational Needs Organisers (SENOs), is responsible for processing applications from schools for special educational needs supports. SENOs make recommendations to my Department where Assistive Technology is required. The NCSE operates within my Department's criteria in making recommendations for support, which is set out in my Department's Circular 0010/2013.
In order to qualify for equipment under the Assistive Technology scheme, a child must have been diagnosed with a physical or communicative disability and must also have a recommendation in a professional assessment that the equipment is essential in order to allow the child to access the curriculum. It must also be clear that the existing I.T. equipment in the school is insufficient to meet the child's needs.
I can confirm that an incomplete application for Assistive Technology was received for the child in question. Officials from my Department have reverted to the SENO seeking further information to support the application. On receipt of the requested information, a decision will issue to the school regarding this matter, following full consideration of the application.
195. Deputy John Curran asked the Minister for Education and Skills following the publication of the action plan for housing and homelessness four months ago, the status of the progress made to date on action 3.12; the actions taken to date by SOLAS to update skills forecasts ensuring a supply of construction workers is available; and if he will make a statement on the matter. [35086/16]
View answerIn September SOLAS published the 2016 National Skills Bulletin where shortage indicators are highlighted across a range of construction-related occupations from professional to craft to skilled operative. SOLAS has finalised its latest forecast for craft apprenticeship including construction-related apprenticeships. This forecast, in addition to the data and trends provided in the 2016 National Skills Bulletin feeds into the annual SOLAS/ETB service planning exercise which incorporates the planning of construction related apprenticeships by SOLAS in conjunction with the Education and Training Board sector and Institutes of Technology.
SOLAS are also in discussion with the Construction Industry Federation to evaluate construction skill needs across a range of non-apprenticeship areas. As a result SOLAS is targeting specific construction related skills shortages in its service planning with the Education and Training Boards.
A campaign to promote apprenticeship is currently being developed by SOLAS in consultation with key partners including the Apprenticeship Council. The campaign will raise awareness and promote the value of apprenticeship for individual apprentices and for employers and it will cover both existing apprenticeships and the new apprenticeships now coming on stream and will include a new apprenticeship website.
