Written Answers Nos. 161-180
» ...
»
Written Answers Nos. 161-180
161. Deputy Chris Andrews asked the Minister for Finance if yoga studios currently in the VAT rate group of 13.5% can be moved into the second reduced rate of 9% in conjunction with other sporting activities and physical education activities; and if he will make a statement on the matter. [13927/20]
View answerThe VAT rating of goods and services is subject to the requirements of the EU VAT Directive, with which Irish VAT law must comply. In general, the VAT Directive provides that all goods and services are liable to VAT at the standard rate unless they fall within Annex III of the Directive, in respect of which Member States may apply either one or two reduced rates of VAT. The “use of sporting facilities” is specifically listed in Annex III which therefore allows Ireland to apply the second reduced rate, currently 9%.
Services consisting of the care of the human body supplied in the course of a health studio business or similar business, such as a yoga studio, are not listed in Annex III and therefore would in general be subject to the standard rate. However, the Directive allows for historic VAT treatment to be maintained under certain conditions and Ireland has retained the application of the reduced rate of VAT, currently 13.5%, to the services of yoga studios. This is known as a ‘parked rate’ and the continuation of this reduced rate application is conditional on the rate being no less than 12%. Therefore, there is no discretion under the Directive to apply the 9% rate to these services.
162. Deputy Anne Rabbitte asked the Minister for Finance if he is considering the introduction of a VAT claim back on the purchase of materials related to crèches reopening post Covid-19; and if he will make a statement on the matter. [14013/20]
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 accordance with the VAT Directive, crèche services are exempt from VAT. As is the case with all VAT exempt businesses, crèches are not entitled to reclaim VAT on the purchase of materials used for their VAT exempt supplies, nor are they required to charge VAT on their fees.
163. Deputy Sean Sherlock asked the Minister for Finance the costings carried out on the programme for Government; and if he will provide documents on those costings. [14030/20]
View answerThe Department of the Taoiseach has published material provided by Government Departments in accordance with agreed procedures, via the Department of the Taoiseach, to Fianna Fáil, Fine Gael and the Green Party, as part of Government formation negotiations; this information is available at the following link: www.gov.ie/en/publication/7b927-programme-for-government-documents/.
Additionally, the costings provided by my Department to political parties as part of the Programme for Government discussions will be published together with the costings provided in advance of Budget 2020 and in preparation for Election 2020. It is intended that these costings will be published on my Department’s website on 15 July 2020. As such, the costings will be made available but my Department will not be providing them on an individual basis.
164. Deputy Carol Nolan asked the Minister for Finance the external consultancy organisation or provider which delivered diversity and inclusion training within his Department from 2018 to date; the costs associated with such services; and if he will make a statement on the matter. [14055/20]
View answerI wish to advise the Deputy that the organisation that provided the unconscious bias programme to 53 staff of the Department during 2018 was CMC Business Psychology Ltd. and the cost was €5,610.26.
165. Deputy Carol Nolan asked the Minister for Finance the expenditure his Department incurred in respect of external legal fees in each of the years from 2016 to date in tabular form; and if he will make a statement on the matter. [14072/20]
View answerThe amount my Department incurred in respect of external legal fees in each year since 2016 are in the following table.
|
Year |
External Legal Fees Amount |
|
2020 (to date) |
€226,193.93 |
|
2019 |
€471,546.46 |
|
2018 |
€948,806.92 |
|
2017 |
€2,463,556.26 |
|
2016 |
€734,859.80 |
Note 1: Over the course of this period, additional amounts of €526,106.84 in 2017 and €249,382.50 in 2018 were paid in respect of the costs of other parties.
Note 2: there are timing differences between when costs are incurred by the Department and when they are recouped which can lead to recoupments being received in the subsequent financial year.
*Recoupments:
2016: €269,419.15
2017: €856,138.60
2018: €214,400.72
2019: €38,507.63
2020 unavailable at this time.
167. Deputy Aodhán Ó Ríordáin asked the Minister for Finance the annual cost of the removal of the 3% USC surcharge on incomes over €100,000 for the self-employed. [14114/20]
View answerI am advised by Revenue that the estimated first and full year costs of abolishing the 3% Universal Social Charge (USC) surcharge on incomes over €100,000 for the self-employed are €53m and €98m, respectively. These estimated figures are based on projected 2020 incomes, calculated on the basis of actual data for 2017, which is the latest year for which income tax returns data are currently available. I am further advised by Revenue that income data for 2018 should be available in the coming weeks and may give rise to a revision of these estimates.
168. Deputy David Cullinane asked the Minister for Finance if matters raised in correspondence by a person (details supplied) on the calculation of ANRWP, average revenue net weekly pay, for the temporary wage subsidy scheme will receive a response; and if he will make a statement on the matter. [14131/20]
View answerAs previously advised to the Deputy in my reply to his Parliamentary Question on 30 June 2020, the amount of Temporary Wage Subsidy Scheme (TWSS) payable to eligible employees is based on their ‘average revenue net weekly pay’ (ARNWP) for January and February 2020, as returned by the employer to Revenue through the real-time PAYE system. The ARNWP calculation is based on the number of insurable weeks within the January/February period rather than the pay frequency used, as this is a more accurate and consistent method across all types of employees.
In the example referenced by the Deputy, Revenue advise me that there is no underpayment of subsidy. The individual in question was paid for two full months in January and February 2020, which includes nine insurable weeks and the ARNWP is correctly calculated by dividing the total net pay figure for the two-month period by nine. Revenue has informed me that it has reviewed the relevant payroll submissions in respect of the individual and is satisfied that the calculations are operating correctly and in accordance with the rules of the scheme.
Regarding the taxation status of payments made under the TWSS, these amounts are income supports and share the characteristics of income. Therefore, payments made under the scheme are subject to income tax and Universal Social Charge (USC), but not employee PRSI. The TWSS payments are not being taxed in real-time through the PAYE system but a recipient will become liable for tax and USC at the end of the year, which will be calculated by Revenue through the ‘End of Year Review’ process.
The tax and USC deductions of the individual in question are currently being calculated on the ‘week 1’ basis of calculation rather than the ‘cumulative’ basis of calculation. This means that any unused tax credits will be ‘preserved’ until year end and can be offset against any tax or USC liabilities that arise. As previously advised, any additional tax credits such as health expenses may also be used to further reduce or eliminate tax liabilities arising from the payment of the TWSS. Revenue has also assured me that if any tax and USC liabilities still arise following the allocation of unused credits, it will work with persons impacted to collect the outstanding liabilities over an extended period. This will be achieved by reducing their tax credits for future years, thereby minimising any financial hardship to the greatest extent possible.
Finally, Revenue has advised me that it will make direct contact with the person to clarify any queries she may still have regarding how the TWSS entitlements are calculated.
169. Deputy Carol Nolan asked the Minister for Finance the status of the concern expressed in a 2018 report from the Oireachtas Standing Committee of Public Accounts that established macroeconomic indicators have become unreliable in the Irish context and that the distorted picture they provide overstates debt sustainability and is costing the State hundreds of millions of euro each year in EU budget contributions; and if he will make a statement on the matter. [14142/20]
View answerIrish macroeconomic statistics have been heavily affected by globalisation and the activities of multinationals in recent years. I have outlined on a number of occasions the difficulties in particular with using GDP given the small and very open nature of the economy. This was most evident with the national accounts figures for 2015 (published in 2016). For these reasons, alternative measures of output produced by the CSO, such as modified Gross National Income (‘GNI*’), offer a more appropriate benchmark for economic activity.
For example, my Department uses a range of metrics to assess debt sustainability rather than solely relying on debt to GDP figures. This includes the debt to GNI* ratio. Last year, this ratio was 99 per cent whereas the GDP equivalent was substantially lower at 59 per cent. Furthermore, my Department produces an annual report on public debt which discusses these types of issues in depth. This year’s report is currently being finalised and will be published later in the year.
In relation to EU budget contributions, these are calculated by the EU Commission in line with the provisions outlined in Own Resource Decision (ORD) Regulation (2014/335) which was ratified by all Member States. There are three main sources of revenue, namely customs duties, VAT and GNI based contributions. The latter is the largest source of income for the EU and Ireland is obliged to make payments based on our share of EU GNI. This ensures that EU revenues match expenditure.
In recent years, Ireland has become a net contributor to the EU budget reflecting the growth in the economy, the overall size of the budget as well a range of other factors. This period has also been marked by a large increase in Ireland’s GNI based contribution in part due to the effects of globalisation. My Department will release a new report on our financial transactions with the EU later in the year.
170. Deputy John McGuinness asked the Minister for Finance if the Revenue Commissioners have agreed the amounts of refunds due to a person (details supplied); if refunds are due, when payments will be made; and if a tax clearance certificate has been issued. [14153/20]
View answerI am advised that the refund claims in question have been examined by Revenue, following which three are approved as correctly due, four require further clarifications from the taxpayer or tax agent and three are not properly due. The issues requiring further clarification have been provided to the tax agent to which responses have not yet been received.
The refunds that were approved will be offset against the significant tax liabilities owed by the person in question. A tax clearance certificate cannot issue to the person until arrangements are agreed regarding the full tax liabilities owed.
171. Deputy Steven Matthews asked the Minister for Finance the position for businesses that have received letters from the Revenue Commissioners regarding an inspection of their compliance regarding the temporary wage subsidy scheme; and the ramifications for businesses that are ultimately in compliance but due to staffing shortages or working from home arrangements are unable to meet the five day deadline for the compliance check as set out by the Revenue Commissioners. [14162/20]
View answerThe Temporary Wage Subsidy Scheme (TWSS) is a support to maintaining employment during the public health restrictions necessitated by the COVID-19 pandemic. To date, the scheme has provided support to almost 59,000 employers in respect 568,000 employees totalling €1.9 billion. Approximately 410,000 employees are currently in receipt of the subsidy.
The Emergency Measures in the Public Interest (COVID-19) Act 2020 places the administration of the TWSS under the care and management of Revenue, which includes ensuring that this very significant investment of public funds is properly allocated to eligible employers and employees. In the exercise of this important role, Revenue is conducting a programme of compliance checks on all employers availing of the scheme to confirm that they meet the eligibility criteria and crucially that employees are receiving the correct amount of subsidy due to them.
In order to verify eligibility, Revenue is asking employers to summarise the impact of the COVID-19 restrictions on their business, the basis on which they reasonably anticipated a reduction of 25% or more in their turnover in Quarter two of this year, and whether the expected level of reduction actually occurred. In order to ensure that employees are being fairly treated and TWSS funds are being paid out as intended, Revenue is also seeking a sample of payslips from each employer. It is important to note that employers are obliged to include the amount of subsidy paid on each employee’s payslip.
Regarding the Deputy’s specific concerns, Revenue has assured me that it is fully aware of the difficulties that many businesses are currently experiencing due to the pandemic and will minimise any administrative burden arising from the compliance checks to the greatest extent possible, including issuing the compliance notifications on a staggered basis over the next few months. For many employers, a simple statement that due to the nature of their business, they were required to cease trading for a significant part of Quarter two is sufficient to confirm eligibility. Where any employer genuinely cannot provide the required documentation or payslip copies within the five days due to staffing shortages, working from home arrangements or any other difficulty, Revenue will provide the additional time needed if the business makes contact and advises of when the documentation will be provided.
Revenue has advised me that where a business had a reasonable basis for projecting a minimum 25% decrease in turnover, but ultimately suffered a lesser reduction in trade, it will require that employer to exit the scheme on a prospective basis rather than suffer any retrospective impact. However, where a business was clearly not eligible for the scheme or failed to pay the correct level of subsidy to its employees, or abused the scheme in any other way, there will be a requirement to repay the funds received. Any identified abuse of the TWSS will also lead to a more in-depth examination of the employer’s overall tax position.
Finally, Revenue has advised me that it has issued just over 4,000 compliance notifications to-date and many of these employers have already provided prompt and satisfactory responses. Some of the employers have provided commendations in relation to the speed of development of the TWSS and in respect of Revenue's role in ensuring such a vital liquidity support is being properly applied.
172. Deputy Brendan Griffin asked the Minister for Finance if 2020 renovation expenditure on a bed and breakfast can be claimed as tax relief in 2021 (details supplied) in view of the fact there will be no income in 2020 due to the Covid-19 crisis; and if he will make a statement on the matter. [14179/20]
View answerI am advised by the Revenue Commissioners that renovation expenditure on a bed and breakfast (B&B) could, depending on the type of expenditure involved, either be regarded as capital or revenue in nature.
Where accommodation is provided as part of the carrying on of a B&B trade, in computing the profits chargeable to tax, a deduction will be available for expenditure that is revenue in nature and which is expended wholly and exclusively for the purposes of the B&B trade. For example, this might include the cost of repainting a bedroom or purchasing bed linen.
If the expenditure is capital in nature and qualifies for wear and tear (capital) allowances, the amount of taxable profits of the B&B trade may be reduced by the amount of the wear and tear allowances. Capital expenditure incurred on plant and machinery (fixtures and fittings) in use for the purposes of a B&B trade can be offset against trading profits at a rate of 12.5% per annum over 8 years. Renovation work to a building which is used for the purposes of carrying on a B&B trade will generally not qualify for capital allowances. However, if any expenditure is in respect of the refurbishment of a Guest House which is registered with Fáilte Ireland, it may qualify for wear and tear allowances of 4% per annum over 25 years. Renovation expenditure on a B&B located in a Special Regeneration Area under the Living City Initiative may qualify for a wear and tear allowance of 15% per annum over 7 years.
If the B&B trade is carried on by an individual (sole trader), any expenses of a revenue nature will be taken into account in computing the amount of any trading profit or loss arising in 2020. In addition, the individual can use any available wear and tear allowances relating to capital expenditure to create or augment a trading loss that can be set against other taxable income in 2020. Any remaining trading loss or excess capital allowances can be carried forward for offset against profits of the B&B trade in 2021 and future years.
If the B&B trade is carried on through a company, available wear and tear allowances are taken into account in computing the amount of any trading profit or loss for the accounting period. If the company has a trading loss in 2020, it can offset that loss against taxable profits in the current and preceding accounting periods and carry forward any balance remaining for offset against trading profits in its 2021 and future accounting periods.
173. Deputy Brendan Griffin asked the Minister for Finance if insurance providers will refund the 2020 public liability insurance premiums for seasonal bed and breakfasts which have not opened (details supplied); and if he will make a statement on the matter. [14180/20]
View answerI am aware that there have been many concerns expressed about how the insurance industry is responding to the needs of its business policyholders in these difficult times, including B&Bs and guesthouses. The Deputy should note that neither I, nor the Central Bank, have any influence over the pricing of insurance products, nor can we compel any insurer operating in the Irish market to provide refunds to their customers, as this is a commercial matter for insurers. This position is reinforced by the EU Single Market framework for insurance (the Solvency II Directive) 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.
Notwithstanding the above, I and my officials have had extensive engagement with the insurance industry over insurance cover and reliefs for businesses during the COVID-19 emergency. The outcome of this engagement is an agreement that I announced on 10 April whereby most of the key insurers in the Irish market - namely Allianz, AIG, AXA, FBD, Liberty Insurance, RSA, Travelers Insurance and Zurich - will ensure that a number of common forbearance measures are available to their business customers. It should be noted that this is a voluntary agreement, but my views are that the other major insurers in the Irish market should also sign up to this commitment.
The common measures included in the agreement are outlined below:
Forbearance
Insurers will reduce premiums for business customers to reflect reduced level of exposure as a result of COVID-19 restrictions for Employer Liability/ Public Liability and Commercial Motor.
Insurers will allow up to 28 days after renewal for payment.
Business Premises
Insurers will maintain cover for unoccupied commercial buildings/ premises not in use due to COVID-19 restriction (for a maximum of 90 days). Appropriate supervision and security of the premises is required.
Insurers will support requests for a change of property use during the crisis.
While I believe that the above agreement should assist many businesses in relation to their insurance, this will only happen if insurers deliver upon their commitments. Therefore, I asked Insurance Ireland to put in place a mechanism which provides proof of delivery. My Department received the first “Activity Report” on this issue from Insurance Ireland on 25 May. This Report shows that in the period 23 March to 4 May, Insurance Ireland members processed 4,093 forbearance requests for business customers worth a total of €5,242,349. I have sought more detailed information from Insurance Ireland on the nature of the forbearance being offered, as I want to be certain that they are adhering to the spirit of the commitment they entered into, and I am awaiting that currently.
The Deputy should also be aware that the Central Bank has written to insurance firms setting out their expectations that insurance firms should take account of the difficult and challenging situation in which many customers find themselves. The Bank has also stated that, as a matter of urgency, firms should develop consumer-centric solutions to the handling of insurance payment breaks and policy rebates in light of the COVID-19 emergency.
I have said on more than one occasion that insurers should treat their customers honestly, fairly and professionally and in line with the Central Bank’s Consumer Protection Code. However, neither the Central Bank nor I have any role in adjudicating on matters such as insurance refunds or rebates. I encourage consumers to engage directly with their broker or insurer regarding forbearance measures and other reliefs. If there continues to be a disagreement between an insurer and a policyholder, then the appropriate channels for resolving them must be followed i.e. through use of a firm’s internal complaint process or recourse to the Financial Services and Pensions Ombudsman or litigation.
Finally, I would like to assure the Deputy that my Department will continue to be as pro-active as it can be on these issues and will continue to liaise with the Central Bank and Insurance Ireland on an ongoing basis. In that regard, my officials will be meeting with Insurance Ireland today on a number of issues as part of their ongoing engagement with them. It should also be noted that I met with the Alliance for Insurance Reform recently and my Department will continue to seek their members’ experience on these matters.
174. Deputy Brendan Griffin asked the Minister for Finance if a decision on a wage subsidy application by a club (details supplied) in County Cork will be re-examined; and if he will make a statement on the matter. [14181/20]
View answerI previously responded to the Deputy on this matter on 27 May 2020 in reply to a Parliamentary Question that he addressed to me. The position has not changed since then.
The Temporary Wage Subsidy Scheme (TWSS) is available for any employee, whether full-time or part-time, who was on the payroll of the employer at 29 February 2020. This requirement is set down in Section 28 of the Emergency Measures in the Public Interest (COVID-19) Act 2020.
I have been advised by Revenue that the individual in question did not begin his current employment until 9 March 2020, which is outside of the specified dates provided in the legislation. For this reason, it is not possible for Revenue to provide his employer with access to the TWSS on his behalf.
175. Deputy Ged Nash asked the Minister for Finance the number of agency staff employed by a bank (details supplied) in which the State is a majority shareholder;; and if he will make a statement on the matter. [14204/20]
View answerThe Deputy will be aware that as Minister for Finance, I am precluded from intervening in how AIB manages its day-to-day business and staffing issues. Decisions in this regard are solely the responsibility of the board and management of the bank which must be run on an independent and commercial basis. The independence of the banks in which the State has a shareholding is protected by Relationship Frameworks which are legally binding documents that cannot be changed unilaterally. These frameworks, which are publicly available, were insisted upon by the European Commission to protect competition in the Irish market.
Notwithstanding this, the information sought by the Deputy in respect of the number of agency staff employed by AIB is not held in the Department.
Officials in my department forwarded your query to AIB and received the following response:
"AIB does not employ any agency staff, however, it does engage a number of third parties to provide resources, the level of which fluctuates based on ongoing business requirements. For commercial reasons AIB does not disclose the details of those arrangements."
176. Deputy Niamh Smyth asked the Minister for Finance if he will meet with banks on behalf of mortgage holders whose mortgage contracts are being delayed due to the fact that they are in receipt of the temporary wage subsidy scheme; the steps he is taking to address the issue; and if he will make a statement on the matter. [14221/20]
View answerI fully appreciate the concerns many people are experiencing about mortgage applications and drawdowns at this difficult time, and my Department is maintaining close contact with the Central Bank and Banking and Payments Federation Ireland (BPFI) as the lending industry works to address the difficulties the Covid-19 situation is causing for both borrowers and lenders. In this context, the Central Bank has advised that it expects all regulated firms to take a consumer-focused approach and to act in their customer's best interests at all times, including during the Covid-19 pandemic.
In the context of mortgage applications, lenders continue to process applications and have supports in place to assist customers impacted by COVID-19. The BPFI has published a Covid-19 Support FAQ which customers can consult, or customers can contact their lender directly, if they have any queries or concerns about the impact of COVID-19 on their mortgage application. However, within the parameters of the regulatory framework, as set out below, the decision to grant or refuse an individual application for mortgage credit, or temporarily suspend a mortgage approval in principle, is a commercial and contractual decision to be made by the regulated entity and it is not appropriate or possible for me to instruct lenders in that regard.
The European Union (Consumer Mortgage Credit Agreements) Regulations 2016 (CMCAR) provide that, before concluding a mortgage credit agreement, a lender must make a thorough assessment of the consumer’s creditworthiness. The assessment must take appropriate account of factors relevant to verifying the prospect of the consumer being able to meet his or her obligations under the credit agreement and must be carried out on the basis of information on the consumer’s income and expenses and other financial and economic circumstances which is necessary, sufficient and proportionate. The CMCAR further provides that a lender should only make credit available to a consumer where the result of the creditworthiness assessment indicates that the consumer’s obligations resulting from the credit agreement are likely to be met in the manner required under that agreement. In addition, the Central Bank’s Consumer Protection Code 2012 imposes ‘Knowing the Consumer and Suitability’ requirements on lenders. Under these requirements, lenders are required to assess affordability of credit and the suitability of a product or service based on the individual circumstances of each borrower.
177. Deputy Patricia Ryan asked the Minister for Finance when he will enact the Consumer Insurance Contracts Act 2019; and if he will make a statement on the matter. [14335/20]
View answerIn line with the commitment that I had previously given that the commencement of the Consumer Insurance Contracts Act would be determined by the Minister for Finance of the new Government, I can confirm that the matter is under active consideration. I envisage that the bulk of the provisions of the Consumer Insurance Contracts Act will be commenced shortly.
I am also keen to determine an appropriate commencement date for section 8 ‘Pre-contractual duties of consumer and insurer’ and Section 12 ‘Renewal of contract of insurance’, and the interlinked Sections 9 ‘Proportionate remedies for misrepresentation’ and Section 14(1)-(5) ‘Duties of consumer and insurer at renewal ’ as soon as possible. On the basis of my previous discussions with the insurance industry, I believe a certain amount of time is required for them to put in place new systems and processes to enable them implement these provisions effectively. I expect that my officials will provide me with their assessment as to the appropriate lead in time shortly, once they have concluded their current discussions with Insurance Ireland. I then expect to be able to signal my decision on this matter in the next number of weeks.
178. Deputy Louise O'Reilly asked the Minister for Finance the number of requests for information and any other interactions the Central Bank has had with the investigation into the insolvency of a company (details supplied); and if he will make a statement on the matter. [14356/20]
View answerI am informed by the Central Bank that it cannot comment on its engagement with individual firms.
Two companies of the group in question have notified the Central Bank of their intention to passport services into Ireland under authorisations obtained in the UK and Germany.
The group does not hold an authorisation from the Central Bank of Ireland.
179. Deputy Cormac Devlin asked the Minister for Finance if consideration will be given to reducing the VAT rate on personal protective equipment to 0%; and if he will make a statement on the matter. [14391/20]
View answerThe European Commission Decision C(2020)2146, adopted on 3 April 2020, provides for the importation of goods to fight the effects of COVID -19 (including personal protective equipment) from outside the European Union without the payment of VAT or Customs Duty from January 2020. Such relief is permitted where the goods are imported by or on behalf of State bodies, public bodies and other bodies governed by public law, disaster relief agencies and organisations approved by Revenue including organisations regulated by the State and involved in the care, support and treatment of people at risk of COVID-19 and there is no scope to extend this. The goods must be distributed or made available free of charge to the persons affected by or at risk from or involved in combating the COVID-19 outbreak by the bodies and organisations referred to above. The relief is scheduled to end on 31 July 2020 but there is provision for an extension if this is required following a review and consultation with Member States. An extension of 3 months is currently being considered.
Following a request from my Department, Revenue has also implemented, on an administrative basis, the application of the zero rate of VAT to the domestic supply of certain goods as necessary to combat COVID-19 (including personal protective equipment) when supplied to hospitals, nursing homes, GP practices and the like, for use in the delivery of COVID-19 related health care services to their patients. This concessionary treatment will apply until 31 July, subject to review. The scope of the relief corresponds with the relief on the importation of these goods by the bodies specified in the Commission Decision.
Any further extension of zero rating to cover supplies of personal protection equipment would require a change in legislation at EU level; the VAT Directive would not permit a legislative measure for the application of the zero rate of VAT to such supplies and there are no grounds in the Commission Decision that would support the adoption of such a measure, even on a temporary basis.
The Deputy will be aware that businesses which are registered for VAT and incur VAT in relation to goods which will be used for the purposes of the taxable business are entitled to reclaim the VAT incurred through their VAT return.
180. Deputy Cathal Crowe asked the Minister for Finance if a reduced VAT rate will be implemented for the tourism sector similar to the steps taken during the last recession to help businesses survive as they reopen post Covid-19. [14398/20]
View answer193. Deputy Ged Nash asked the Minister for Finance his plans for a lower VAT rate for the tourism sector; his views on the findings from the 2018 OECD economic survey of Ireland report which recommended that preferential VAT rates be eliminated and lower rates for discretionary categories of expenditure, for example, hotel and restaurants are regressive; and if he will make a statement on the matter. [14589/20]
View answer194. Deputy Ged Nash asked the Minister for Finance his plans for a lower VAT rate for the tourism sector in view of the July 2018 report of his Department stating the regressive nature of the reduction; and if he will make a statement on the matter. [14590/20]
View answerI propose to take Questions Nos. 180, 193 and 194 together.
The Government is fully aware of the unprecedented impact that the coronavirus is having on business and people’s livelihoods. In this regard a range of measures have been introduced to provide income support to those who need it while also giving confidence to employers to retain the link with employees so that when this crisis passes our people can get back to work as quickly and seamlessly as possible.
In addition to current support measures, my officials are examining a range of possible measures to ensure that the economy is in a position to recover rapidly while maintaining a stable tax base.
