Written Answers Nos. 231-249
231. Deputy Caoimhghín Ó Caoláin asked the Minister for Finance if he will consider the recommendation in Tobacco Free Ireland to introduce a levy on the tobacco industry; the discussions his Department has had with the Department of Health on this; and if he will make a statement on the matter. [19339/17]
View answer232. Deputy Caoimhghín Ó Caoláin asked the Minister for Finance if his Department has undertaken research on the recommendation in Tobacco Free Ireland to introduce a levy on the tobacco industry; and if he will make a statement on the matter. [19340/17]
View answerI propose to take Questions Nos. 231 and 232 together.
I am aware of the proposal to introduce a levy on the tobacco industry which was included as a recommendation in the Department of Health's Tobacco Free Ireland. The proposal was included in my Department's Tax Strategy Group papers of 2015 which form a basis for the discussions of the Tax Strategy Group. As discussed in that paper, a levy of this type, on presumably the profits of tobacco companies, is not without complications and may have impacts on other areas of the economy.
In Ireland, profits of companies are taxed through corporation tax. To levy the profits of tobacco companies would complicate this. Ireland's corporate tax rate of 12.5% on trading income is akin to a brand and is an important part of the Government's strategy of creating an enterprise friendly environment to attract jobs and investment to Ireland. One of the main features of the rate is its simplicity and the fact that it applies to a broad base. The suggested levy would involve complexity and could undermine the attractiveness of Ireland's corporate tax offering.
When a tobacco industry levy was proposed in the UK in 2015, the British Treasury concluded, on foot of a public consultation, that the impact of a tobacco industry levy would be passed on to the consumer. The Chancellor of the Exchequer announced in his Summer Budget 2015 that he would not be pursuing the proposal.
As outlined in the Programme for a Partnership Government, this Government is committed to making Ireland tobacco free by 2025. The Government has agreed that pricing is a key means of reducing tobacco consumption. I have increased the price on a packet of cigarettes cumulatively by €1.40 over my last three budgets, raising revenue and contributing to the continued decline of smoking prevalence. Ireland continues to impose excise duty on tobacco which is among the highest in the EU.
233. Deputy Róisín Shortall asked the Minister for Finance if, in view of the potential sale of part of the State investment in a bank (details supplied), his Department has made an assessment on possible future dividends from the bank over any time period; and if so, the results of such an assessment. [19364/17]
View answer238. Deputy Róisín Shortall asked the Minister for Finance if his Department has made an assessment on possible future dividends from a bank (details supplied) over any time period in view of the potential sale of part of the State investment in the bank; and if so, if he will provide the results such assessment to Dáil Éireann. [19381/17]
View answerI propose to take Questions Nos. 233 and 238 together.
As the Deputy will be aware, the payment of any dividend is exclusively a matter for the board and management of AIB based on the bank’s financial performance and future prospects, and subject to regulatory approval.
AIB announced a proposed dividend payment of €250m to ordinary shareholders as part of their annual results for 2016, 99.9% of which will accrue to the State as the Bank’s majority shareholder. This payment is particularly significant given that it has been nine years since the bank last paid a dividend to shareholders.
While the factors influencing such dividend payments are outside my control, I would consider it normal for a profitable bank in a normal business environment to pay a prudent, regular dividend to Ordinary Shareholders where there is no impediment to do so, in keeping with a commercial strategy and financial performance objectives espoused by the bank’s management.
In determining that an IPO was the best route to maximise value for the State the Department and its advisors ran a number of income and capital return scenarios over the period since 2014. To date however we have not formally incorporated any forecast dividend payment schedule in our budgetary projections. Given the State is considering a disposal of some of its shares over the coming period, it would not be advisable for me to put any forecasts into the public domain.
234. Deputy Paul Kehoe asked the Minister for Finance the status of a payment under the help-to-buy incentive scheme for persons (details supplied); when payment will be made; and if he will make a statement on the matter. [19368/17]
View answerI am advised by Revenue that a payment issued to the persons concerned under the Help to Buy incentive on 12 April 2017. Revenue has apologised to the persons concerned for the delay in processing the payment.
235. Deputy Paul Kehoe asked the Minister for Finance the status of a claim for a tax refund for 2016 by a person (details supplied); and if he will make a statement on the matter. [19369/17]
View answerI am advised by Revenue that a review has been carried out for 2016 for the person concerned and a refund of the overpaid tax has been made. If the person concerned requires any further clarification on any aspect of his tax position he should contact his local Revenue District in Wexford who will be happy to help him.
236. Deputy Niall Collins asked the Minister for Finance his views regarding the very few insurers now willing to insure Irish hotel liability insurance; the reason there is no Irish insurer that will insure hotels for new business currently; the steps being taken to tackle the cost of business insurance from a regulatory viewpoint (details supplied); and if he will make a statement on the matter. [19377/17]
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 position 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. Consequently, while I am aware of the difficulties faced by the hotel sector, I am not in a position to direct insurance companies to provide cover or to price at a particular level.
Nevertheless, it is possible for the State to play a role in helping to stabilise the market and deal with factors contributing to the availability and cost of insurance. Accordingly, I established the Cost of Insurance Working Group and appointed Minister of State Eoghan Murphy as Chair. This Working Group is examining the factors contributing to the increasing cost of insurance and identifying what short, medium and long-term measures can be introduced to help reduce the cost of insurance for consumers and businesses. The initial focus of the Working Group was the issue of rising motor insurance premiums and the Report on the Cost of Motor Insurance was published in January 2017.
The Working Group is now in its second phase which is concentrating on the Employer Liability and Public Liability insurance sectors. The terms of reference for this work have been agreed and the following core areas are being considered:
- Overview of the Employer Liability and Public Liability insurance sectors
- Impact of the cost of insurance on the competitiveness of particular business sectors
- Impact of health and safety issues on the cost of insurance
- Other market issues
In addition, the Working Group is building upon the previous work done in the motor phase in order to determine how it can be applied in the employer liability and public liability insurance claims areas particularly in relation to:
- Personal Injury data and information
- Effects of legal costs and litigation processes on insurance costs
- Current claims compensation arrangements and cost of claims
- Impact of unlawful activity on insurance sector
The Working Group is continuing to meet on a regular basis to examine issues related to Employer Liability and Public Liability insurance, including those pertinent to the hotel sector. Indeed, as part of the current consultation process, there has already been a very informative engagement with the Irish Hotels Federation, as well as other organisations within the hospitality sector such as the Licensed Vintners Association and the Vintners’ Federation of Ireland.
It is envisaged that the final results of the second phase will take the form of an addendum to the existing Report. As with the first phase, the aim is for all relevant bodies and stakeholders to work together in order to deliver fairer premiums for businesses without unnecessary delay.
237. Deputy Catherine Murphy asked the Minister for Finance the basis on which the VAT rate for disability equipment and mobility aids is decided; the scope that is available to reduce VAT rates for disability equipment or to recategorise such equipment into a different VAT bracket, for which lower rates apply; and if he will make a statement on the matter. [19380/17]
View answerI am advised by Revenue that the VAT rating of goods and services is subject to EU VAT law, with which Irish VAT law must comply. In general, the Directive provides that all goods and services are liable to VAT at the standard rate unless they fall within particular categories of goods and services specified in the Directive, in respect of which Member States may apply a lower rate or exempt from VAT.
The supply of a range of medical equipment and appliances, which include invalid carriages (excluding mechanically propelled road vehicles), orthopaedic appliances, deaf aids, walking frames and crutches, fall within one of these categories and are subject to the zero rate of VAT. In addition, the Value-Added Tax (Refund of Tax) (No. 15) Order, 1981, provides in certain circumstances for the refund of VAT on goods which are aids or appliances and includes goods specially constructed or adapted for use that are purchased for the exclusive use of a person with a disability of a type specified for the purposes of the Order. The provisions of the Order also extend to works carried out on homes to adapt them to make them more accessible for disabled persons. The provisions do not apply to the actual construction of a home but would apply, for example, to certain alterations or adaptations which would be necessary to meet the particular needs of the disabled person.
239. Deputy John Lahart asked the Minister for Finance if his Department has assessed the impact of the coming into effect of Chapter 4A of Part 12 of the Taxes Consolidation Act providing a termination of the carry-forward of certain unused capital allowances; his plans to review the issue; and if he will make a statement on the matter. [19387/17]
View answerChapter 4A of Part 12 Taxes Consolidation Act (TCA) 1997, which was introduced in Finance Act 2012, provides for a termination of the carry-forward of certain unused capital allowances after the “tax life” of the relevant building or structure has ended. With effect from 1 January 2015, any unused accelerated capital allowances, which are carried forward beyond the “tax life” of the building or structure to which they relate, are lost immediately
I am advised by Revenue that a Revenue eBrief was issued on 1 September 2015 to draw the attention of taxpayers and their agents to the implications of this measure. It outlined the changes introduced and provided a timely reminder to anyone filing tax returns that the capital allowances computations carried forward to 2015 should be adjusted to exclude any building or structure whose “tax life” ended in 2014. Revenue issued a further eBrief in the matter in April 2016. Revenue has included a reminder note on Income Tax and Corporation Tax Return forms since 2015, in the relevant section where capital allowances claims are made by taxpayers, that the carry forward of excess accelerated capital allowances by passive investors is no longer available in accordance with Chapter 4A of Part 12 TCA 1997.
I am further advised by Revenue that the bulk of tax returns to potentially reflect the effects of the restriction contained in Chapter 4A were only received in late 2016. Revenue is currently examining criteria to assist in identifying specific cases where unused capital allowances have been carried forward previously to ensure that the requirements of the legislation have been met.
An economic impact assessment on the impact of property based reliefs was published by my Department in December 2011. As part of the work leading to that report, organisations and individuals were invited to submit their views as part of a public consultation process which ran from 23 June to 29 July 2011. Over 700 individual responses were received.
Finally, the deputy will note that in my Budget speech for Budget 2012, I said that there was scope for those with larger incomes to contribute more. I also said that the timescale for the termination of the carry-forward of unused capital allowances, allowed time for individuals to adjust to the change.
240. Deputy Michael McGrath asked the Minister for Finance the status in terms of resolving the outstanding claims associated with a company (details supplied); and if he will make a statement on the matter. [19389/17]
View answerSetanta was placed into liquidation by the Malta Financial Services Authority on 30 April 2014. This liquidation is being carried out under Maltese law. As of 31 March 2017, the number of open claims is 1,649. Progress in the liquidation has been delayed due to court proceedings in the case of Law Society of Ireland v the Motor Insurers' Bureau of Ireland (MIBI). The focus of the court action is to determine whether it is the Insurance Compensation Fund (ICF) or MIBI which is responsible for the payment of third party claims.
The current position is that we are awaiting the outcome of MIBI's appeal to the High Court ruling, which was heard before the Supreme Court in October 2016. No date has been specified for the judgment.
It should be noted that 1st party claims (i.e where a person makes a claim against their own comprehensive insurance policy) are not affected by the court action. These come within the scope of the ICF and are being processed by the Office of the Accountant of the Courts of Justice up to a limit of 65% of the claim. To date the ICF has been able to make 1st party payments totalling €608,085 to Setanta policyholders.
The position in relation to 3rd party motor insurance claims is that they are unlikely to be processed until after the outcome of the Supreme Court appeal.
The Liquidator for Setanta has informed me that:
- Claims provision required stands at between €87.7 million and €95.2 million.
- Setanta policies were cancelled in May 2014. The 2 years allowable under the statute of limitation to lodge claims has expired so the claims figures will not increase further.
- The Liquidator reports that it is proving difficult to settle claims in advance of the outcome of the MIBI appeal.
- The Liquidator continues to be of the view that he will not be in a position to meet more than 30% of claims.
I expect to be able to provide a more accurate update after the legal proceedings are concluded.
241. Deputy Michael McGrath asked the Minister for Finance if the Central Bank is responsible for enforcing the unfair contract terms directive 1993 and the European Communities (Unfair Terms in Consumer Contracts) Regulations 1995 for banks and regulated financial service providers; if it has taken enforcement action on banks and lenders in respect of consumer mortgage contracts; if enforcement actions have taken place regarding persons who were denied tracker mortgage rates; and if he will make a statement on the matter. [19390/17]
View answerThe European Communities (Unfair Terms in Consumer Contracts) Regulations 1995 [S.I. No. 27 of 1995] (the ‘1995 Regulations’), which gives effect to Council Directive No. 93/13/EEC (the Directive on Unfair Terms in Consumer Contracts), is a designated statutory instrument for the purposes of the Central Bank Act 1942 (the ‘1942 Act’).
Accordingly, if the Central Bank suspects on reasonable grounds that a regulated financial service provider is committing, or has committed, a contravention of the 1995 Regulations it may hold an inquiry to determine whether or not the financial service provider is committing or has committed the contravention or it may enter into a settlement agreement with the financial service provider to resolve the matter.
If, at the conclusion of an inquiry, the Central Bank finds that the financial service provider is committing, or has committed, a contravention of the 1995 Regulations it may impose one or more of the sanctions listed in Section 33(AQ)(3) of the 1942 Act, including a reprimand and a direction to pay a monetary penalty to the Central Bank. Settlement agreements entered with the financial service provider may include terms under which the financial service provider accepts the imposition of sanctions of the kind referred to in Section 33(AQ) of the 1942 Act.
As the Deputy is aware, the Central Bank concluded an enforcement investigation into tracker mortgage-related matters at Springboard Mortgages Limited (‘Springboard’) in November 2015. In the course of the investigation the Central Bank found that Springboard failed to apply correct interest rates to 222 customer accounts over a seven-year period between August 2008 and July 2015.
Pursuant to the settlement agreement entered with Springboard to conclude the investigation, the Central Bank issued a reprimand and imposed a monetary penalty of €4.5 million on Springboard. The monetary penalty paid by Springboard is the highest penalty ever collected by the Central Bank further to an enforcement investigation. In addition to the reprimand and monetary penalty, the Central Bank also required Springboard to implement a major redress and compensation programme for impacted customers during the course of its investigation. To date Springboard has provided redress and compensation in the amount of approximately €5.8 million to impacted customers.
The Central Bank has also commenced enforcement investigations into tracker mortgage-related matters at Permanent tsb plc and Ulster Bank Ireland DAC.
The Central Bank may also commence other enforcement investigations, as appropriate, into other lenders and persons concerned in the management of such entities where there is evidence of non-compliance with regulatory requirements.
Template to accompany requests to the Central Bank for material for replies to PQs, Topical Interest Debates (TIDs) and any other briefing that, up to now, went to the Press Office in the Bank
It has been agreed with the Central Bank that this template will be used with effect from 24 May 2012.
From that date also, there will be a dedicated email address for requests. Please use instead of the Press email - pqs@centralbank.ie.
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Department of Finance contact(s) |
John Fitzpatrick Leonard Wall |
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Contact telephone numbers |
01-6045698 076-1007682 |
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Contact email address |
John.fitzpatrick@finance.gov.ie Leonard.wall@finance.gov.ie |
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Deputy submitting PQ or TID |
Michael McGrath |
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PQ reference number |
PQ 19390/17 |
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Date for answer, priority, written or oral |
Written, 01/05/2017 |
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Deadline time for reply from the Central Bank |
21/04/17 (11am) |
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To ask the Minister for Finance if the Central Bank is responsible for enforcing the Unfair Contract Terms Directive 1993 and the Unfair Terms in Consumer Contract Regulations 1995 for banks and regulated financial service providers; if it has taken enforcement action on banks and lenders in respect of consumer mortgage contracts; if enforcement actions have taken place in relation to persons that were denied tracker mortgage rates; and if he will make a statement on the matter. |
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Draft reply or material for inclusion in reply. This material to be completed in Word in the column opposite to facilitate ‘cut and paste’ in D/Finance |
The European Communities (Unfair Terms in Consumer Contracts) Regulations 1995 [S.I. No. 27 of 1995] (the ‘1995 Regulations’) which gives effect to Council Directive No. 93/13/EEC (the Directive on Unfair Terms in Consumer Contracts) is a designated statutory instrument for the purposes of the Central Bank Act 1942 (the ‘1942 Act’). Accordingly, if the Central Bank suspects on reasonable grounds that a regulated financial service provider is committing, or has committed, a contravention of the 1995 Regulations it may hold an inquiry to determine whether or not the financial service provider is committing or has committed the contravention or it may enter into a settlement agreement with the financial service provider to resolve the matter. If, at the conclusion of an inquiry, the Central Bank finds that the financial service provider is committing, or has committed, a contravention of the 1995 Regulations it may impose one or more of the sanctions listed in Section 33(AQ)(3) of the 1942 Act, including a reprimand and a direction to pay a monetary penalty to the Central Bank. Settlement agreements entered with the financial service provider may include terms under which the financial service provider accepts the imposition of sanctions of the kind referred to in Section 33(AQ) of the 1942 Act. The Central Bank concluded an enforcement investigation into tracker mortgage-related matters at Springboard Mortgages Limited (‘Springboard’) in November 2015. In the course of the investigation the Central Bank found that Springboard failed to apply correct interest rates to 222 customer accounts over a seven-year period between August 2008 and July 2015. Pursuant to the settlement agreement entered with Springboard to conclude the investigation, the Central Bank issued a reprimand and imposed a monetary penalty of €4.5 million on Springboard. The monetary penalty paid by Springboard is the highest penalty ever collected by the Central Bank further to an enforcement investigation. In addition to the reprimand and monetary penalty, the Central Bank also required Springboard to implement a major redress and compensation programme for impacted customers during the course of its investigation. To date Springboard has provided redress and compensation in the amount of approximately €5.8 million to impacted customers. The Central Bank has also commenced enforcement investigations into tracker mortgage-related matters at permanent tsb plc and Ulster Bank Ireland DAC. The Central Bank may also commence other enforcement investigations, as appropriate, into other lenders and persons concerned in the management of such entities where there is evidence of non-compliance with regulatory requirements. |
Note
Any other relevant information e.g. in the case of oral questions, material which the Central Bank considers could be used for supplementary questions and for briefing the Minister.
Department of Finance/Central Bank
May 2012
242. Deputy Michael McGrath asked the Minister for Finance if the independent review on corporate taxation will include an analysis of the European Commission's common consolidated corporate tax base, CCCTB, proposal; and if he will make a statement on the matter. [19391/17]
View answerThe terms of reference of the review of the corporation tax code announced last October do not provide for analysis of either the European Commission's proposal for a Council Directive on a Common Corporate Tax Base or their proposal for a Council Directive on a Common Consolidated Corporate Tax Base (CCCTB). These proposals do of course form part of the context in which the review is being undertaken.
243. Deputy Michael McGrath asked the Minister for Finance the areas to be covered by his Department's tax strategy group for 2017; and if he will make a statement on the matter. [19392/17]
View answerPreparatory work in relation to the Tax Strategy Group for 2017 is ongoing at present. A number of topics have been advanced but have not been finalised. It is therefore premature to provide a definitive list at this time. It is envisaged however, that the following papers may be included; Income Tax and USC, General Excises, PRSI, Social Protection Package, Capital Taxes/Exit/DIRT, Corporation Tax, VAT and Climate and Environmental Taxes. Other topics for discussion/review may be included.
244. Deputy Michael Healy-Rae asked the Minister for Finance the status of a refund for a person (details supplied); and if he will make a statement on the matter. [19445/17]
View answerI am advised by Revenue that Relevant Contracts Tax (RCT) was deducted from payments due to the person concerned. Section 530P of the Taxes Consolidation Act prohibits the repayment of RCT to a subcontractor in respect of the year in which the tax was deducted until such time as their tax return (Form 11) has been filed, a notice of assessment has issued and all liabilities for income tax and other taxes have been discharged.
The person concerned may accelerate the repayment of the RCT deducted in 2016 by filing his 2016 return of income now. The RCT deducted in 2016 will be repaid after all other tax liabilities (if any) have been satisfied. If the person concerned requires any assistance in filing his 2016 tax return he may contact Revenue on 1890 368 378.
Any RCT deducted to date in 2017 can be used to offset any other tax liabilities due in 2017 such as VAT or PAYE/PRSI. The person concerned is now on a deduction rate of 0% for the purposes of RCT.
245. Deputy Brendan Smith asked the Minister for Finance his plans to enable credit unions to provide loans for social housing, SMEs and mortgages; and if he will make a statement on the matter. [19566/17]
View answerI am pleased that the credit union sector is considering various proposals to increase its income and develop its business model. My Department has received a number of such proposals from both the Irish League of Credit Unions (ILCU) and the Credit Union Development Association (CUDA). Proposals from both representative bodies, in relation to the funding of social housing, are at various stages of development. While the Department of Housing, Planning, Community and Local Government is the Department primarily responsible for the formulation and implementation of policy and for the preparation of legislation in relation to housing, any such proposal would require approval of the Registrar of Credit Unions at the Central Bank before it could be implemented.
Social Housing Funding
The Central Bank has informed me that it has received information regarding proposals for credit unions to provide funding for social housing and is currently engaging with the sector on those proposals. It further stated that while it does not comment on specific proposals, such investments could be facilitated by future regulations made by the Central Bank, where appropriate. The Central Bank also stated that it is willing to consider the type of regulations that would be required to facilitate such proposals. However, the Central Bank's key consideration in evaluating such proposals is its statutory mandate to ensure the protection of members' savings by credit unions and to ensure the wellbeing of the sector generally.
Officials from both my Department and the Department of Housing, Planning, Community and Local Government have met with the representative bodies on a number of occasions to examine how credit unions can assist in the area of social housing. Officials from both Departments have also met with the Central Bank. Separately, communication is ongoing between the Department of Housing, Planning, Community and Local Government and my Department.
On 1 January 2016, I commenced the final sections of the Credit Union and Co-operation with Overseas Regulators Act 2012 (2012 Act) following discussions with credit union representative bodies. Following commencement of the legislation, the Central Bank introduced the Credit Union Act 1997 (Regulatory Requirements) Regulations 2016, regarding a number of areas including savings, borrowing, lending, investments and liquidity.
Investment regulations made specific reference to section 43 of the Act and to further classes of investments in which a credit union may invest its funds. The regulations provide that investments in projects of a public nature include, but are not limited to, investments in social housing projects. The Central Bank are currently reviewing the investment regulations for credit unions and on completion of their review will undertake a public consultation in 2017.
Notwithstanding any potential changes that may be made to the regulations, the legislative requirement for credit unions to ensure investments do not involve undue risk to members' savings will remain the overriding factor which must inform all credit union investment decisions.
SME Lending
In relation to small and medium enterprises (SMEs), the Central Bank has informed me that credit unions are permitted to provide commercial loans to their members. Commercial loans are subject to concentration, maturity and large exposure limits as outlined in the 2016 Regulations. In addition, where a credit union is considering granting a commercial loan, a comprehensive business plan and detailed financial projections (supported by evidence based assumptions), appropriate for the scale and complexity of the loan, should be provided and in place before such a loan is granted. This should enable the credit union to ensure that it is satisfied that the borrowing business has the capacity to generate sufficient income to repay the commercial loan. The Central Bank has further informed me that lending to SMEs is a specialist form of lending that requires specific skills and expertise. In general, this type of lending is viewed as high risk which may not be appropriate for all credit unions.
Mortgages
Currently credit unions can and some do provide mortgages to members. These types of loans are subject to certain maturity limits contained in the 2016 Regulations. The 2016 Regulations set out the percentage of a credit union's loan book that can be outstanding for periods exceeding both five years and ten years, as well as limits on the maximum outstanding liability to an individual member. Under the 2016 Regulations credit unions continue to be allowed to lend up to 30% of their loan book over five years and up to 10% of their loan book over 10 years, subject to a maximum maturity of 25 years. In addition, credit unions can apply to the Central Bank for an extension to their longer term lending limits (up to 40% of their loan book over 5 years and up to 15% of their loan book over 10 years). Approval is subject to conditions set by the Central Bank. There are currently 12 credit unions approved to avail of increased longer term lending limits.
The Central Bank informs me that the December 2016 Prudential Return indicates that for the sector overall, total gross loans over 10 years amount to c. 2.7% of total loans in the credit union sector compared to the limit of 10% (and in some cases 15%).
The Central Bank has indicated that while it can see longer term lending, including mortgages, being part of a balanced portfolio of total lending, in their analyses, credit unions need to consider the impact of longer term lending on interest margins, return on assets and on balance sheet structure – the issue of funding longer term lending with short term funding is a challenge for the credit union business model. The Central Bank further informs me that consumer mortgage lending is an activity that has its own unique risk profile, and proposals to become involved in mortgage lending in a significant way must be supported by an evidenced based business case.
The Credit Union Advisory Committee's (CUAC) recent report makes a number of recommendations, one of which is to conduct a full review of lending limits and concentration limits. I have established an Implementation Group which to date has met on three occasions and is currently assessing each of CUAC's recommendations with a view to implementation as appropriate. Central to its work is ensuring a full examination of lending limits and concentration limits is carried out as recommended. I look forward to regular progress reports from the Implementation Group as these recommendations are developed and implemented.
246. Deputy James Browne asked the Minister for Finance the availability of agricultural relief from capital acquisitions tax, in which the farming land that is the subject of the relief has an already commissioned solar farm or is wholly or partially the subject of an unexercised option in favour of a solar farm developer or the subject of a burden in the Land Registry prohibiting the alienation or transfer of the landholding without the consent of a solar farm developer; and if he will make a statement on the matter. [19588/17]
View answerI am advised by Revenue that gifts and inheritances of agricultural property, including land, qualify for relief (known as 'agricultural relief') from the payment of Capital Acquisitions Tax (CAT) once certain conditions are satisfied. Section 89 of the Capital Acquisitions Tax Consolidation Act (CATCA) 2003 provides for 'agricultural relief'. The relief takes the form of a 90% reduction in the taxable market value of the gifted or inherited agricultural property.
The person taking the gift or inheritance (the 'beneficiary') of the agricultural property must qualify as a 'farmer' for the purpose of section 89 CATCA 2003. This means that a beneficiary's agricultural property must comprise at least 80% by gross market value of the beneficiary's total property at a particular date. Revenue takes the view that land on which solar panels are installed is not agricultural property for the purpose of establishing whether or not a beneficiary satisfies this '80%' test. Thus, depending on the amount of an individual's land that is actually occupied by solar panels (and not merely subject to an option over the land), the use of agricultural land for a solar farm may result in a beneficiary's failure to satisfy the '80%' test and to qualify for agricultural relief.
A condition for agricultural relief that applies in relation to gifts and inheritances taken on or after 1 January 2015 is that a beneficiary, or a lessee where the beneficiary leases the agricultural land, must actually farm the land for a period of at least 6 years after taking the gift or inheritance. It is unlikely that the ability to farm the land would be affected by the granting of an option over the land to a solar farm developer or the registration of a burden over the land with the Land Registry. However, the ability to farm the land would be affected where the option is exercised by the solar farm developer and solar panels are actually installed. As it would not generally be possible to farm any part of the land occupied by solar panels, the change in the use of land from farming to the generation of solar energy within the required 6-year period would result in a withdrawal of some, or all, of any agricultural relief that had been granted, depending on how much of the land is diverted to this alternative use.
I would however inform the Deputy that arising out of a commitment I made in the Dáil during the Report Stage of Finance Act 2016, an interdepartmental group has been established, which is currently examining the treatment for tax purposes of farmland on which solar panels are installed.
I expect that group to report to me in due course with its recommendations.
247. Deputy Pearse Doherty asked the Minister for Finance his views on whether the whistleblower procedures for banks and other financial institutions are sufficiently strong and that they give adequate protection to whistleblowers; and if he will make a statement on the matter. [19595/17]
View answer248. Deputy Pearse Doherty asked the Minister for Finance the number of whistleblowers' allegations currently being examined by the Central Bank; and if he will make a statement on the matter. [19596/17]
View answer249. Deputy Pearse Doherty asked the Minister for Finance if the Central Bank has considered re-examining historic evidence and allegations from whistleblowers in view of the new legal and ethical rules in place; and if he will make a statement on the matter. [19597/17]
View answerI propose to take Questions Nos. 247 to 249, inclusive, together.
New protections for persons making protected disclosures to the Central Bank came into force on 1 August 2013. This also introduced new obligations on certain categories of persons in regulated firms to disclose breaches of financial services legislation to the Central Bank. The Central Bank has established a whistleblower desk and put in place policies and procedures to ensure that such disclosures are dealt with appropriately.
In broad terms, where a person makes a disclosure in good faith to the Central Bank or one of its employees, and the person making the disclosure has reasonable grounds for believing that the disclosure will show that there has been a breach of, or offence under, financial services legislation or the concealment or destruction of evidence relating to such an offence or breach and provides their name, the disclosure is a protected disclosure.
The EU Regulation establishing the Single Supervisory Mechanism, which formally commenced on 4 November 2014, includes a provision in respect of reporting of breaches, i.e. whistleblower reports, which relate to those banks directly supervised by the European Central Bank. Persons with information on potential breaches of EU law by banks and/or by competent authorities, including the Central Bank of Ireland, can report such breaches to the ECB.
I am satisfied that whistleblower procedures for banks and other financial institutions are robust and that they give adequate protection to whistleblowers. All allegations from whistleblowers are treated seriously and examined thoroughly irrespective of which legislative protections apply. It is a valuable channel for the Central Bank to receive reports in a confidential form.
Any individual who has new information regarding a previous allegation is welcome to contact the Bank again with this new information.
The Central Bank is currently considering approximately 50 whistleblower allegations.
