Written Answers Nos. 93-105
93. Deputy John Curran asked the Minister for Finance the estimated cost of extending the tax credit to all households in view of the fact that the home carer tax credit is not paid to those earning under €29,000; and if he will make a statement on the matter. [44913/17]
View answerThe Home Carer's Allowance (as it was then) was introduced in Finance Act 2000, in the context of a move to the partial individualisation of the income tax system. Such a system limits the transferability of tax bands and credits from a non-earning spouse to the earning spouse, with the stated economic objectives of increasing labour force participation among secondary earners and reducing the numbers of workers paying the higher rates of income tax.
In tandem with this move towards an individualised tax system, and in order to ensure a balance was maintained between those going out to work and families with caring responsibilities in the home, a Home Carer’s tax allowance was introduced for married one-income families where one spouse works primarily in the home caring for children, the aged or incapacitated persons.
This allowance was subsequently converted into the Home Carer Tax Credit (HCC), and the Deputy will be aware that, in Budget 2018, I announced that the HCC, which is of benefit to over 80,000 families annually, is being increased from €1,100 to €1,200 per annum. This follows from an increase in last year’s Budget from €1,000 and an increase from €810 in Budget 2016 giving a total increase in the credit over the last three Budgets of €390.
With regard to the Deputy’s proposal to extend the credit to all households, I note that the Deputy’s question does not define household for this purpose – for example it is not clear if the Deputy envisages extending the credit to single person households, single parent households and/or double income households. In this regard, I would note that extending the credit to households other than single-earner households with caring responsibilities in the home would run counter to the policy rationale underpinning the credit since its introduction.
As with all tax credits, the HCC has the potential to be of benefit only to qualifying recipients with sufficient levels of taxable income to absorb the credit. For example, a single-income, PAYE earner family will see a benefit from the HCC where household income exceeds €24,750, as income of up to this amount can be sheltered from tax by the married personal tax credit of €3,300 and the PAYE tax credit of €1,650. The basis for the figure of €29,000 stated in the Deputy’s question is unclear, however I would note that there would be no cost, and no associated benefit for the relevant individuals, of extending a tax credit to households that do not have sufficient taxable income to utilise it.
94. Deputy Clare Daly asked the Minister for Finance if the ODCE or the Financial Services Ombudsman is examining the possibility of criminal sanctions being applied to those in Irish banks which wrongfully precluded persons from availing of their legal entitlement to their tracker mortgage options. [44916/17]
View answerAs the Deputy is aware, the Central Bank is conducting an industry wide examination of tracker mortgage related issues and arising from this it has and is pursuing enforcement investigations into a number of mortgage lenders.
It is also important to note that the Central Bank, in its role as independent financial regulator, has statutory reporting obligations to An Garda Síochána and other agencies where it suspects a criminal offence may have been committed by a supervised entity. The Central Bank takes these obligations very seriously and complies with them on an on-going basis as appropriate, and it has met with An Garda Síochána and other entities.
The Office of the Director of Corporate Enforcement, which falls under the remit of the Department of Business, Enterprise and Innovation, has its own statutory remit and if it considers that there have been breaches of company law it would be a matter for that body to consider the appropriate action to pursue.
In regard to the Financial Services Ombudsman (FSO), the FSO deals independently with unresolved complaints from consumers about their individual dealings with all regulated financial service providers. The FSO tries, in the first instance, to resolve complaints in an informal manner by mediation through its dedicated Dispute Resolution Service. However, where disputes are not resolved through mediation the FSO will investigate and adjudicate on the complaint. The FSO has a wide range of powers and can direct compensation of up to €250,000 and direct rectification which could, for example, include redress, where a borrower has been charged the incorrect interest rate, and restoration to the correct rate. While a person who obstructs the Financial Services Ombudsman in the exercise of his functions and powers or fails to comply with requirements or requests during an investigation may be guilty of an offence and subject to criminal sanction, the FSO does not, however, have the power to apply criminal sanctions for actions of a financial service provider in their dealings with individual consumers.
95. Deputy Michael McGrath asked the Minister for Finance the debt-to-GDP targets in each of the years 2018 to 2023, in tabular form; and if he will make a statement on the matter. [45013/17]
View answerForecasts for the general government gross debt to GDP ratio for the period 2018 to 2021 are set out in the Budget 2018 Economic and Fiscal Outlook book and re-produced as follows.
|
- |
2018 |
2019 |
2020 |
2021 |
|
Gross debt (€billions) |
208.2 |
211.5 |
208.2 |
209.0 |
|
Gross debt ratio per cent of GDP |
69.0 |
67.1 |
63.5 |
61.2 |
Projections beyond 2021 have not been compiled or published. However, in its Annual Debt Report 2017, (http://www.finance.gov.ie/wp-content/uploads/2017/07/annual-debt-report-2017.pdf) my Department has set out a purely illustrative trajectory for the debt-to-GDP ratio over the period to 2025.
96. Deputy Michael McGrath asked the Minister for Finance the estimated net fiscal space less budget 2018 carryover costs and Public Service Stability Agreement costs per annum in 2019 to 2021, inclusive, in tabular form; and if he will make a statement on the matter. [45014/17]
View answerThe details that the Deputy has requested are set out in the following table.
|
€billion |
2019 |
2020 |
2021 |
|
Net fiscal space |
3.2 |
3.5 |
3.6 |
|
Budget 2018 Carry over costs: |
|||
|
Expenditure measures |
.2 |
||
|
Public Service Stability Agreement |
.37 |
.34 |
.23 |
|
Tax measures |
.01 |
-.04 |
-.04 |
|
Net fiscal space less carryover |
2.6 |
3.2 |
3.4 |
Page 37 of the Expenditure Report 2018 outlines the carryover impact of the Public Service Stability Agreement for 2018-2020. Table 7 on page 38 provided an estimate of €192 million in respect of the full-year impact of Budget 2018 current expenditure measures in the areas of Social Protection, Education and Justice. As these estimates relate to measures being implemented in 2018 they will be impacted by the actual cost and timing of implementation and consequently the estimated costs will be reassessed as part of the Budget Estimates process for 2019 as set out in the expenditure report, these costs would need to be met from the unallocated resources in 2019 or from savings/reprioritisations identified, for example through the Spending Review process.
In relation to the Budget 2018 tax measures it is estimated that there would be a total carryover cost into 2019 of €14 million. For 2020 and 2021 the carryover impact is revenue generating (shown in the table with a negative sign) which will increase fiscal space.
I should point out that the exact impacts of carryover will be reviewed as part of the normal Budgetary process, as there are a lot of moving parts to be considered, such as economic growth, take up of various schemes and specific tax relevant factors, which could impact on the expected return from the measures.
Finally, I would also like to reiterate that choosing the right budgetary stance should be the guiding principle going forward. We must ensure that budgetary policy is appropriate in supporting sound macroeconomic conditions. It must be cognisant of the cyclical position of, and careful not to overheat, the economy.
97. Deputy Michael McGrath asked the Minister for Finance the EU budget contribution Ireland has made in each of the years 2011 to 2017; the estimated contributions for each of the years 2018 to 2021; and if he will make a statement on the matter. [45015/17]
View answerEU Budget payments and public sector receipt data are published annually by the Department of Finance in the Budget Statistics publication. For ease of reference, Ireland's contributions to the EU budget for the years 2011 to 2016 are set out in the following table:
|
YEAR |
Payments to the EU budget €m |
|
2011 |
1349.7 |
|
2012 |
1393.2 |
|
2013 |
1726.2 |
|
2014 |
1685.5 |
|
2015 |
1952.1 |
|
2016 |
2022.8 |
In relation to current and future years, it is worth noting that EU budget forecasts are contingent on a number of variables, including the size of the overall EU budget for any individual year and other operational developments which will only emerge as the year progresses. As such, these estimates are monitored and updated on an ongoing basis as new information becomes available.
At the time of Budget 2018, my Department forecast that Ireland's contribution to the EU budget for 2017 to be €2,300 million. For future years, the Department currently estimates contributions of €2,650 million in 2018, €2,675 million in 2019 and €2,750 million in 2020.
The Commission is due to present a proposal on the next Multi-annual Financial Framework (post 2020) by mid-2018. While my Department currently forecasts Ireland's contributions to the EU budget for 2021 to be €2,775 million, this figure is used primarily for illustrative purposes.
98. Deputy Thomas P. Broughan asked the Minister for Finance the additional personnel and resources, including the purchase of two additional mobile X-ray scanners, for the Revenue Commissioners after budget 2018; and if he will make a statement on the matter. [45027/17]
View answerIn Budget 2018 I provided an additional €4 million to Revenue for an extra 100 staff (full time equivalent). These staff will be deployed mainly on audit and investigation activities, particularly PAYE Employer Compliance in advance of PAYE modernisation. It also provides for recruitment of additional international tax and transfer pricing specialists and resources to enhance ICT systems capacity for data matching and data analytics in tax and duty compliance interventions. These additional resources will lead to a direct increase in tax and duty yield from compliance interventions.
I am advised by Revenue that the latest mobile x-ray container scanner was deployed in January 2017. It utilises state of the art imaging technology to analyse containers as well as vehicles. This scanner was part financed using a European Commission OLAF grant under the HERCULE 3 program. This scanner is expected to remain in service until at least 2028. The scanner is operated from within existing resource. Revenue continuously reviews its detection technology requirements, and implements a normal replacement and upgrade strategy taking account of developments in those technologies. Revenue has advised that it is satisfied with their current detection technology and consider that border points are adequately serviced by these detection systems. Revenue will continue to review its technology requirements for 2018.
99. Deputy Jackie Cahill asked the Minister for Finance the way in which the family home will be treated for stamp duty when being transferred to a son or daughter to be used as the recipient's primary residence; the way it will be treated in cases in which the recipient has a separate primary residence; and if he will make a statement on the matter. [45049/17]
View answerI am advised by Revenue that the transfer of a family home to a son or daughter constitutes a conveyance on sale for the purposes of the Stamp Duties Consolidation Act (SDCA) 1999. Stamp duty is payable by the transferee, in this case the son or daughter whether or not it was transferred by way of sale or gift. Where a property is sold or otherwise transferred for less than market value, section 30 SDCA 1999 imposes a charge to stamp duty at the market value of the property.
Family relationships, the purposes for which a property is used or the number of properties owned are not relevant for stamp duty purposes, other than in the case of certain transfers of agricultural property between family members where a measure known a consanguinity relief may apply.
Stamp duty on transfers of residential property is chargeable at the rate of 1% where the consideration does not exceed €1 million. Where the consideration exceeds €1 million stamp duty is chargeable at 1% on the first €1 million and 2% of the balance in excess of €1 million.
101. Deputy Bernard J. Durkan asked the Minister for Finance the extent to which his Department continues to rebut the suggestions from persons in the European Commission to the effect that Ireland has a responsibility to collect taxes on profits earned in jurisdictions other than Ireland; his views on whether this is an interference with Ireland's internal taxation policy; and if he will make a statement on the matter. [45068/17]
View answerIreland has never accepted the Commission’s analysis in the Apple State Aid Decision. An appeal has therefore been brought before the European Courts. Such an appeal takes the form of an application to the General Court of the European Union, asking it to annul the Decision of the Commission.
The Attorney General prepared the legal grounds in support of the annulment proceedings and the application has been lodged in the General Court of the European Union. As is normal practice, a summary of these has been published in the Official Journal of the European Union. This has also been published on the Department of Finance’s website.
As outlined in this published summary, one of the main lines of argument in Ireland's annulment application is that the Commission has exceeded its powers and interfered with national tax sovereignty. The Commission has no competence, under State Aid rules, unilaterally to substitute its own view of the geographic scope and extent of the Member State’s tax jurisdiction for those of the Member State itself.
As this topic is the subject of open legal proceedings, it will not be possible to comment further, in particular on any of the individual elements of the State's legal case in defence of our position. This is important to ensure that we do not prejudice our own legal case.
103. Deputy Bernard J. Durkan asked the Minister for Finance when the benefits of the review of the motor insurance sector will accrue in terms of reduced premiums; and if he will make a statement on the matter. [45070/17]
View answerAs you will be aware, the Cost of Insurance Working Group – which is now chaired by Minister of State Mr. Michael D'Arcy T.D. – published its Report on the Cost of Motor Insurance on 10 January 2017. The Report makes 33 recommendations with 71 associated actions to be carried out in agreed timeframes, set out in an action plan within the Report.
Work is ongoing on the implementation of the recommendations by the relevant Government Departments and Agencies and there is a commitment within the Report that the Working Group will prepare quarterly updates on its progress. The third such update was published on the Department’s website on 23 October 2017 and shows the progress to date on the overall implementation of the recommendations. In total, 32 actions were due for completion in the first three quarters of the year and 29 of those actions have been completed. Updates on the state of play of the three outstanding actions are provided in the third progress report. It should be also noted that substantial work has also been undertaken in respect of the nine action points categorised as "ongoing".
I believe that the continued implementation of the Report on the Cost of Motor Insurance will make a difference to the pricing of insurance premiums over the next 12-18 months. It is envisaged that the implementation of all the recommendations cumulatively, with the appropriate levels of commitment and cooperation from all relevant stakeholders, will achieve the objective of delivering fairer premiums for consumers.
In this regard, it should be noted that the most recent CSO data (for September) indicates that private motor insurance premiums have reduced by 14.3% year-on-year. While the CSO statistics indicate a greater degree of stability on an overall basis, these figures represent a broad average and therefore there are many people who may still be seeing increases. However, I am hopeful that this greater stability in pricing will be maintained with the result that premiums should continue to fall from the very high levels of last year.
105. Deputy Bernard J. Durkan asked the Minister for Finance if he has identified specific inflationary tendencies within the economy; if so, his plans to address such issues; and if he will make a statement on the matter. [45072/17]
View answerOver the past few years consumer price inflation has been near zero in Ireland and in the euro area more generally. In 2016 annual inflation in Ireland – as measured by the Harmonised Index of Consumer Prices (HICP) was slightly negative at -0.2 per cent.
While inflation has picked up in the rest of the euro area, inflationary pressures have remained muted in Ireland in 2017. This is largely due to the continued impact from euro-sterling exchange rate developments.
Looking forward, futures markets for oil are suggesting oil prices will continue to stay around their current low levels over the course of 2018. In addition, non-energy industrial goods are likely to continue to be a significant drag on inflation next year, reflecting euro-sterling exchange rate developments. Against this, the continued growth in domestic demand and the ongoing recovery in the labour market are expected to lead to further services price inflation. Taking all these factors into account, price pressures are expected to rise only modestly in 2018. As part of Budget 2018, my Department forecast HICP annual inflation of 0.2 per cent for this year, rising gradually to 0.8 per cent in 2018.
While consumer price inflation is not expected to rise dramatically over the near term, my Department continues to monitor inflation developments very closely. Any emergence of sustained price inflation would put pressure on the competitiveness of those sectors that are heavily dependent on exports. This is particularly true for the indigenous manufacturing, the agrifood sector and price sensitive service sectors. In this regard, it is important that, at firm level, overall costs do not get out of line with our competitors and that pay moves in line with productivity developments.
This government will therefore continue to implement competitiveness oriented policies which is the best way domestically to counteract any inflationary tendencies and potential loss of competitiveness.
