Written Answers Nos. 178-205
178. Deputy Christopher O'Sullivan asked the Minister for Finance the steps he can take to ensure that first payments on new mortgages can be deferred where the homeowner is unable to move into his or her new home from rental accommodation due to deferred construction works as a result of Covid-19; and if he will make a statement on the matter. [12108/21]
View answerThe terms for the repayment of a loan will normally be provided for in the particular credit agreement and any decision to adjust those repayment terms, including in respect of when a borrower commences repayment, will be a commercial matter for the lender.
However, if a borrower is experiencing loan repayment difficulty, irrespective of the particular point they are at in their loan term, then the provisions of the Code of Conduct on Mortgage Arrears (CCMA) and the relevant provisions of the Consumer Protection Code as appropriate will apply. I appreciate the stress and uncertainty that many borrowers are facing at this difficult time, and the added pressure for those who are in the process of moving to their own home. Therefore, in respect of any borrower who is in arrears or pre-arrears on a mortgage which is secured on a primary residence, the protections provided for in the CCMA will be available and it is the clear expectation of both the Government and the Central Bank that lenders should engage effectively and sympathetically with such borrowers and where possible to agree a viable alternative repayment arrangement in order to address the particular difficulty.
179. Deputy Malcolm Noonan asked the Minister for Finance if his attention has been drawn to the fact that moneys held in solicitor client accounts will shortly be liable for the imposition of negative interest rates by the two largest banks and, given that these funds are often already borrowed from the banks, will be subject to double interest charging; and if he will make a statement on the matter. [10963/21]
View answerAs the Deputy is aware, as Minister for Finance I have no role in the day to day operations of any bank operating within the State including banks in which the State has a shareholding. I'm precluded from intervening on behalf of any individual customer in any particular bank. Decisions in relation to commercial matters are the sole responsibility of the board and management of the banks, which must be run on an independent and commercial basis. The independence of 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.
The application of interest rate charges is solely a commercial matter for the board and management of each bank.
Deposit balances and liquidity in general has risen significantly across the banking system in Europe in recent years as the ECB has continued to provide additional funds through their asset purchase schemes and long term refinancing operations. This has been further exacerbated by the Covid-19 pandemic as households continue to stay at home and save and businesses defer investment decisions. This excess liquidity which has grown significantly in the European system has to go somewhere and in large part it gets placed back on deposit with the ECB who charge the banks -0.50%. The application of negative deposit rates by the ECB has resulted in European banks incurring a consequent cost on deposit accounts. The Irish banks are impacted in a similar way to their European counterparts. The banks across Europe have looked to pass some of the costs associated with negative rates to deposit holders with larger balances. The Irish banks are no different in this regard.
In passing on some of these costs it is important to note that banks cannot differentiate between customers in different sectors and for that reason the approach taken is to apply charges based on the size of the deposit balance.
180. Deputy Ged Nash asked the Minister for Finance the revenue accrued from the deemed disposal tax in 2018, 2019 and 2020, respectively; and if he will make a statement on the matter. [11007/21]
View answerIt is assumed the Deputy is referring to deemed disposals under exit tax provisions contained in section 627 of the Taxes Consolidation Act 1997. In line with Ireland's commitments under the Anti-Tax Avoidance Directive(ATAD), an ATAD compliant exit tax regime was introduced as part of Finance Act 2018. The exit tax applies at a rate of 12.5% on unrealised gains arising where a company migrates or transfers assets offshore such that they leave the scope of Irish tax.
I am informed by Revenue that information in respect of section 627 is separately recorded on Corporation Tax returns from 2019 onwards. As returns for 2019 were only due in late 2020 for many companies, the data is still being analysed and is provisional at this stage. The provisional data for 2019 does not show any disposals under section 627. Information in respect of 2020 is not yet available as the filing deadlines for most accounting periods ending in 2020 have not yet passed.
181. Deputy Robert Troy asked the Minister for Finance if his attention has been drawn to the fact that mortgage providers are currently unwilling to extend mortgage approval for customers whose approval lapses during level 5 restrictions and, as a result, many potential homeowners will have to go through the entire mortgage approval process for a second time as building works cannot commence during current restrictions; and if he will intervene, alongside the Central Bank, to ensure mortgage approval can be extended in such cases. [11016/21]
View answerI have maintained contact with the BPFI and lenders on the measures they have put in place to assist their customers who are economically impacted by COVID-19. In relation to the particular issue of new mortgage lending, the main retail banks previously confirmed that they are considering mortgage applications and mortgage drawdowns in relation to their customers who were impacted by COVID-19 on a case by case basis and that they are taking a fair and balanced approach. Lenders continue to process mortgage applications and have supports in place to assist customers impacted by COVID-19. Therefore, if mortgage applicants have any queries or concerns about the impact of COVID-19 on their mortgage application or mortgage approval-in-principle they should in the first instance contact their lender directly on the matter.
Regarding the particular issue of extending the period of a mortgage approval in principle, the Central Bank has advised that there are no specific regulatory requirements relating to the duration of an approval in principle. That is a commercial and business matter for individual lenders. However, the Central Bank advises that when a lender offers a mortgage to a consumer, the Consumer Protection Code provides that the lender must include the length of time for which the mortgage offer is valid in the offer document.
More generally there are certain consumer protection requirements which govern the provision of mortgage credit to consumers. For example, 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 with a view to verifying the prospect of the consumer being able to meet his or her obligations under the credit agreement. The CMCAR further provide 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. The assessment of creditworthiness must be carried out on the basis of information on the consumer’s income and expenses and other financial and economic circumstances which are necessary, sufficient and proportionate.
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. The Code specifies that the affordability assessment must include consideration of the information gathered on the borrower’s personal circumstances and financial situation. Furthermore, where a lender refuses a mortgage application, the CMCAR requires that the lender must inform the consumer without delay of the refusal. In addition, the Code requires that the lender must clearly outline to the consumer the reasons why the credit was not approved, and provide these reasons on paper if requested.
If a mortgage applicant is not satisfied with how a regulated entity is dealing with them, or they believe that the regulated entity is not following the requirements of the Central Bank’s codes and regulations or other financial services law, they should make a complaint directly to the regulated entity. If they are still not satisfied with the response from the regulated entity, the response to their complaint from the regulated entity is required to include details for the borrower on how to refer their complaint to the Financial Services and Pensions Ombudsman.
182. Deputy David Stanton asked the Minister for Finance the status of a VAT registration application made by a company (details supplied); when he expects the VAT number will be issued to the company; and if he will make a statement on the matter. [11033/21]
View answerI am advised by Revenue that the average waiting time for a VAT registration application to be processed is generally between 10 and 12 days, where all relevant information and supporting documentation is provided.
Where the requested documentation is not provided or where the level of information is insufficient to properly confirm the precise nature of the goods or services to which VAT is to be applied by the accountable person, then it is not possible for Revenue to complete the registration process.
Revenue has confirmed to me that it has requested additional information from the business in question regarding its VAT registration application, which has not yet been provided. Revenue has assured me that once the information is received it will deal with the matter.
183. Deputy Neale Richmond asked the Minister for Finance if he has considered reassessing the method by which motor tax is calculated to a system by which the cars that produce more harmful exhausts are liable for more tax; and if he will make a statement on the matter. [11098/21]
View answerMotor tax for passenger cars is calculated on the car's emissions. Cars with higher CO2 emissions pay higher rates of motor tax.
The basis of assessment for the motor tax regime changed in Budget 2021 to WLTP CO2 emissions. A new rates table with an increased number of bands and a stronger environmental rationale was introduced in line with Government emissions reduction policy. I am satisfied with the current motor tax regime.
184. Deputy Ged Nash asked the Minister for Finance if the Revenue Commissioners will review the list of eligible sectors from which workers can claim relief for expenses incurred by virtue of their job to include early years educators; and if he will make a statement on the matter. [11102/21]
View answerThe flat rate expense (FRE) regime is operated by Revenue on an administrative basis where both a specific commonality of expenditure exists across an employment category and the statutory requirement for the tax deduction as set out in section 114 of the Taxes Consolidation Act (TCA) 1997 is satisfied, namely, that the expenses are wholly, exclusively and necessarily incurred in the performance of the duties of the office or employment by the employee concerned and that such expenses are not reimbursed by his or her employer.
The FRE regime was established to apply a uniformity of approach to tax deductibility for expenses of large groups of employees and to facilitate ease of administration for both Revenue and employees. The expense should apply to all employees in that category and not be discretionary. Revenue has advised me that it will consider FRE applications where a large number of employees incur broadly identical qualifying expenses which are not reimbursed by their employer.
Applications are generally made by the representative bodies in the employment sectors concerned and are considered by Revenue based on the specific commonality of expenses within the employment category and compliance with the strictly applied statutory requirement for a tax deduction.
I am advised by Revenue that a submission was received from one body who represent early years educators in 2017, and having considered the submission, Revenue was not in a position to apply a flat rate expense, as the expenses were not wholly, exclusively and necessarily incurred in the performance of the duties of the employment. I am further advised that correspondence was received from a separate representative body who represent early years educators in 2018 requesting a flat rate expense, however, to date no submission has been received. Should Revenue receive a submission it will be considered.
Finally, Revenue advises me that it remains committed to the FRE regime and encourages all taxpayers to avail of their full tax relief entitlements. It should be noted that all employees retain their statutory right to claim a deduction under section 114 of the TCA 1997 in respect of an expense incurred wholly, exclusively and necessarily in the performance of the duties of their employment, to the extent which the expenses are not reimbursed by the employer.
185. Deputy Pearse Doherty asked the Minister for Finance if the special purpose vehicle to be established with participating banks as part of the affordable purchase shared equity scheme will be required to obtain a banking licence; if such a banking licence has been applied for; if so, the cost of same; the person or body that will pay the cost; and if he will make a statement on the matter. [11143/21]
View answer186. Deputy Pearse Doherty asked the Minister for Finance if the Central Bank Commission has approved of the affordable purchase shared equity scheme and its interaction with the mortgage measure; if not, when the Central Bank Commission will next meet to consider the scheme and its interaction with the mortgage measures; and if the operation of the scheme is contingent on the Central Bank's approval of the scheme and its interaction with the mortgage measures. [11145/21]
View answer187. Deputy Pearse Doherty asked the Minister for Finance if a contract has been granted to a company (details supplied) for the purpose of advice or consultancy services; the value of the contract; and the total funds paid with respect of same to date. [11149/21]
View answerI propose to take Questions Nos. 185 to 187, inclusive, together.
As the Deputy is aware the development of the Affordable Purchase Shared Equity Scheme is a policy initiative which falls under the remit of the Department of Housing, Local Government and Heritage following the allocation of funding as part of Budget 2021. A range of commercial and operational matters pertaining to the scheme are currently being examined by the Department of Housing but have not yet been finalised and therefore it would be premature to comment on such matters.
I have also received the following reply from the Central Bank in relation to the scheme:
“The Central Bank of Ireland is aware of plans by the Department of Housing, Local Government and Heritage to introduce an Affordable Housing Shared Equity Scheme. Any queries in respect of the Scheme should be referred to the Department. Upon finalisation of the scheme design, the Central Bank will consider the interaction between the scheme and the mortgage measures as well as the proposed operation of the scheme from the perspective of our consumer protection mandate.
The mortgage measures were introduced with the aim of strengthening the resilience of both borrowers and the banking sector. The Central Bank is committed to annually reviewing the calibration of the mortgage measures in the context of wider housing and mortgage market developments, to ensure that they continue to meet their objectives of:
- Increasing the resilience of banks and borrowers to negative economic and financial shocks; and
- Dampening the pro-cyclicality of credit and house prices so a damaging credit-house price spiral does not emerge.”
In relation to PQ 11149 I refer you to the response from the Department of Housing, Local Government and Heritage who also received this question from the Deputy.
188. Deputy Catherine Murphy asked the Minister for Finance the amount of betting duty collected between 1 January and 31 December 2020; the amount collected to date in 2021; the amount in betting intermediary duty collected between 1 January and 31 December 2020; and the amount collected to date in 2021. [11251/21]
View answerI am advised by Revenue that the provisional receipts collected in respect Betting Duty and Betting Intermediary Duty from 1 January 2020 to 31 December 2020 and to date in 2021 are shown in the table below. Finalised 2020 figures will be published in the coming months.
|
Provisional Receipts |
Betting Duty |
Betting Intermediary Duty |
|
2020 |
€84.0 million |
€2.8 million |
|
2021 (to date) |
€20.4 million |
€1.3 million |
189. Deputy Sorca Clarke asked the Minister for Finance the number of goods containers that entered Dublin Port between 1 and 31 December 2020 from countries outside of the EU, in tabular form. [11260/21]
View answer190. Deputy Sorca Clarke asked the Minister for Finance the average time that containers arriving from outside Europe or the UK between 1 and 31 December 2020 were held before being released to their owners. [11262/21]
View answer191. Deputy Sorca Clarke asked the Minister for Finance the number of occasions from 1 December 2020 to date that the customs charges were reduced following a recalculation on containers arriving to Dublin Port. [11263/21]
View answerI propose to take Questions Nos. 189 to 191, inclusive, together.
I am advised by Revenue that data is maintained in its customs IT systems by reference to customs declarations as opposed to containers. Declarations are submitted in respect of individual consignments and a container may have one or multiple associated declarations.
Each declaration is risk analysed by Revenue and assigned a routing: red, orange or green. In December a total of 110,690 import declarations were lodged to Revenue’s IT system. Of those, approx. 95% (105,689) were green routed, 2% (2,011) were orange routed and 3% (2,990) were red routed. Only green routed goods are released for free circulation at which point they can be removed from the port of arrival.
The length of time taken to release goods that are orange or red routed will depend on when the declaration is presented to Revenue, the type of goods being imported, whether the goods require non-customs import controls e.g. sanitary and phytosanitary checks, the accuracy of the data contained in the declaration and the payment of any associated customs duties and taxes.
In relation to the Deputy’s question on recalculation of customs charges I am advised by Revenue that amendments to customs declarations are made for many reasons some of which may result in a recalculation of customs duties. I am further advised that the information requested is not readily extractable from Revenue IT systems and that consequently it is not possible to provide the information requested by the Deputy.
192. Deputy Catherine Murphy asked the Minister for Finance his plans to conduct an analysis of betting duty and betting intermediary duty in the context of the sources it is derived from. [11276/21]
View answerA comprehensive review of betting taxation policy was carried out in 2017 in advance of the rate increases in Budget 2019, where betting duty for retail and online operations increased from 1% to 2%, and the duty for betting exchanges increased from 15% to 25% of commissions earned on a bet. My Department keeps betting duty and betting intermediary duty under a rolling review as part of the Tax Strategy Group papers each year.
193. Deputy Louise O'Reilly asked the Minister for Finance if employees resident in Northern Ireland but working and paying tax here are eligible employees under the employment wage subsidy scheme in cases in which their employers are resident in Northern Ireland. [11280/21]
View answerThe Employment Wage Subsidy Scheme (EWSS) was legislated for under the Financial Provisions (Covid-19) (No. 2) Act 2020. The scheme is an emergency measure to deal with the impact of the Covid-19 pandemic on the economy and to deliver an enterprise support to employers based on business eligibility delivering a per-head subsidy on a flat rate basis.
The EWSS is only available to employers registered in Ireland whose business activities are adversely impacted by the COVID-19 pandemic. In relation to eligible companies who are registered as employers here, the scheme applies to companies resident for tax purposes in the State and also to non-resident companies that carry on a trade in the State through an Irish branch. I understand you are referring to the latter category, being companies that are not tax resident in the State, but which are operating here through an Irish branch.
I have been advised by Revenue that employers can claim the subsidy in respect of any employee who is exercising an Irish contract of employment in the State, and where the employer satisfies the conditions of the scheme.
194. Deputy Matt Carthy asked the Minister for Finance the amount raised through vehicle registration tax in each of the years 2015 to 2020, inclusive; and if he will make a statement on the matter. [11344/21]
View answerI am advised by Revenue that the receipts of Vehicle Registration Tax (VRT) for the years 2015 to 2019 are published at link:
https://www.revenue.ie/en/corporate/documents/statistics/registrations/vehicle-registration.pdf
The provisional receipts of VRT for 2020 are €751.2 million. Finalised 2020 figures will be published in the coming months.
195. Deputy Matt Carthy asked the Minister for Finance the status of vehicle registration tax in terms of EU law; and if he will make a statement on the matter. [11345/21]
View answerThere is no EU law harmonising the registration and taxation of vehicles. Ireland, along with many other Member States, operates a vehicle registration tax.
196. Deputy Mairéad Farrell asked the Minister for Finance the details of contracts of €25,000 or more that have been awarded by his Department or bodies under his aegis that were found to be non-compliant with procurement guidelines in 2018 to 2020 and to date in 2021; the value and nature of the contract work carried out in each case; the year of each contract, in tabular form; and if he will make a statement on the matter. [11376/21]
View answerDeputy, I wish to advise that it was not possible for all the Bodies under my Aegis to respond to your information request in the time available and therefore, a partial reply in line with Standing Order 42A is being issued to you in respect of this Parliamentary Question. I will make arrangements to provide the Deputy with the information in relation to the Bodies under my Aegis as soon as possible and in line with Standing Order 42A.
The ‘National Public Procurement Policy Framework’ issued by the Office of Government Procurement (OGP) in November 2019, sets out the procurement procedures to be followed by government departments and state bodies in accordance with EU rules and national guidelines.
In addition, my Department has its own internal policy and guidance documents to assist staff to comply with all procurement regulations.
Moreover, in compliance with ‘Department of Finance Circular 40/02’ , my Department returns an annual report to the Comptroller and Auditor General (C&AG), in respect of contracts valued €25,000 or more in aggregate (exclusive of VAT) that were undertaken by this Department without a competitive process.
The following table provides details of non-compliant contracts valued at €25,000 or more (exclusive of VAT) that have been awarded by my Department in 2018, 2019, 2020 and to date in 2021.
|
Year(s) |
Contractor |
Details |
Contract Value (exclusive of VAT) |
|
2018 |
Mr. Seamus Coffey |
Independent expert review of Ireland’s corporation tax code. Contract signed in November 2016. |
€26,543 (Cumulative value of payments from 2016 to 2018) |
|
2018, 2019, 2020. |
Eurotext Translations Limited |
Foreign language translation service required in respect of European Court legal documents. Contract signed in 2019. |
€75,579.49(Cumulative value of payments from 2016 to June 2020) |
|
2019, 2020. |
Lilley Ventures t/a Workproducts Inc. |
Matterspace software eDiscovery tool licence renewal. The ongoing renewal of the software licence was critical in connection with the document searches required for the IBRC Commission of Investigation. |
2019 - €8,736 (1/08/2019 to 1/08/2020) 2020 - €17,929 (07/10/2020 to 07/10/2022) Cumulative total €26,665 |
|
2020 |
McCann FitzgeraldSolicitors |
Legal Advice in relation to the Fifth Anti Money Laundering Directive (AMLD 5) McCann Fitzgerald is currently on the Department’s panel of legal advisers – this panel was constituted following a competitive tendering process. In order to engage a firm from this panel, a further tender process known as the “mini-competition” is required. However, in this case, a mini-competition was not undertaken as the Department required legal advice as a matter of urgency. |
€49,661 |
|
2018, 2019, 2020, To date in 2021 |
Vodafone Ireland |
Procurement of international mobile services and handsets. Commencing end Q1/21, international mobile services will be procured under an OGP Framework for mobile telephony services. |
Payments summary:2018 – Nil 2019 - €17,360 (includes charge for 2018 of €5,987)2020 - €13,1362021 - €10,048 Cumulative total €40,544 |
197. Deputy Carol Nolan asked the Minister for Finance the details of the meetings, correspondence and engagements he and his officials have had with a group (details supplied); if he will specifically address the concerns outlined by the group; and if he will make a statement on the matter. [11408/21]
View answerI wish to advise the Deputy that the only engagement that I or my officials have had with the Independent Scientific Advocacy Group (ISAG) relates to correspondence from the ISAG in December 2020 regarding the national response to Covid-19. The correspondence was primarily addressed to the Taoiseach and I was one of a number of recipients copied on the letter.
While the majority of the proposals in the correspondence from the ISAG related to public health policy and were therefore a matter for the Minister for Health, I replied to the ISAG specifically in relation to the issues raised on the economic consequences of the public health restrictions. A copy of the correspondence from the ISAG and my response are attached for your information.
198. Deputy Jennifer Murnane O'Connor asked the Minister for Finance if he plans to enhance the Covid restrictions support scheme to target businesses with a 75% drop in revenue and to remove the current €5,000 weekly cap; if the employment wage subsidy scheme will be extended to the end of 2021; and if he will make a statement on the matter. [11429/21]
View answer234. Deputy Christopher O'Sullivan asked the Minister for Finance if he will consider extending the employment wage subsidy scheme, and Covid restrictions support scheme, for those businesses that are not likely to open until late 2021 at the earliest until December 2021 due to Covid-19 restrictions; and if he will make a statement on the matter. [12133/21]
View answerI propose to take Questions Nos. 198 and 234 together.
The CRSS is a targeted support for businesses significantly impacted by restrictions introduced by the Government under public health regulations to combat the effects of the Covid-19 pandemic. Details of CRSS are set out in Finance Act 2020 and detailed operational guidelines, which are based on the terms and conditions of the scheme as set out in the legislation, have been published on the Revenue website at: https://www.revenue.ie/en/corporate/press-office/budget-information/2021/crss-guidelines.pdf.
To qualify under the scheme, a business must carry on a trade or trading activities, the profits from which are chargeable to tax under Case I of Schedule D. The trade must be carried on from a business premises that is located in a region subject to restrictions introduced in line with the Government’s ‘Living with Covid-19 Plan’, with the result that the business is required to prohibit or considerably restrict customers from accessing its business premises.
To make a claim under the CRSS, a business must be able to demonstrate that, because of the Covid restrictions, the turnover of the business in the period for which the restrictions are in operation, and for which a claim is made, will be no more than 25% of an amount equal to the average weekly turnover of the business in 2019 (or average weekly turnover in 2020 in the case of a new business) multiplied by the number of weeks in the period for which a claim is made.
A qualifying business may make a claim to Revenue under the CRSS for a cash payment known as an “Advance Credit for Trading Expenses”. This payment will be equal to 10% of the average weekly turnover of the business in 2019 (or in 2020 in the case of a new business) up to €20,000 and 5% thereafter, subject to a maximum weekly payment of €5,000, for each week that the business is affected by the Covid restrictions.
As of 25 February 2021, 20,500 businesses have registered 23,800 premises for CRSS with Revenue. 89,000 claims for CRSS payments of €328.8 million in respect of 22,200 premises have been made and €326.9 million of this has been processed for payment.
I have no plans to remove the €5,000 maximum weekly payment which ensures that support is targeted at smaller SMEs.
The objective of the Employment Wage Subsidy Scheme (EWSS) is to support all employment and maintain the link between the employer and employee insofar as is possible. The EWSS has been a key component of the Government’s response to the continued Covid-19 crisis to support viable firms and encourage employment in the midst of these very challenging times. To date, subsidy payments of over €2.1 billion have been made and PRSI relief worth over €360m granted to over 47,200 employers in respect of over 532,000 employees.
I have been clear that there will be no cliff-edge to supports and, as Deputies will be aware from announcements made on Tuesday 23 February, it has been decided that both the EWSS and the CRSS are now to be extended until the end of June 2021.
With the agreement by Government on the revised plan, COVID-19 Resilience and Recovery 2021: The Path Ahead, a cautious and measured approach will be taken as we lay the foundations for the full recovery of social life, public services and the economy. It is, therefore, appropriate that key business supports should remain in place until the end of the second quarter of 2021.
As the revised plan is implemented, the EWSS will play an important role in getting people back to work as public health restrictions are eased, thereby reducing the numbers dependent on social welfare payments over time, including the Pandemic Unemployment Payment (PUP).
Consideration is being given to the fact that continued support could be necessary out to the end of 2021 to help maintain viable businesses and employment and to provide businesses with certainty to the maximum extent possible. Decisions on the form of such support will take account of emerging circumstances and economic conditions as they become clearer.
The Government remains fully committed to supporting businesses and employers insofar as is possible at this time.
199. Deputy Jennifer Murnane O'Connor asked the Minister for Finance if he plans to intervene with the banks to ensure that concession-based moratoriums are provided to shuttered businesses until restrictions are lifted; and if he will make a statement on the matter. [11430/21]
View answerAs the Deputy may be aware, on 18 March last the Banking and Payments Federation of Ireland (BPFI) announced a coordinated approach by banks and other lenders to help their customers who were economically impacted by the Covid-19 crisis. The measures included flexible loan repayment arrangements where needed, including loan payment breaks initially for a period up to three months and then subsequently extended for up to six months. The implementation of this voluntary moratorium by the banking industry was a flexible response to the emerging Covid-19 crisis and ensured that a large volume of affected customers could benefit quickly during a fast moving and evolving public health crisis.
The Deputy may wish to note that borrowers whose payment break has ended are been given an option to return to full repayments based on the same term of the loan or to extend the term of the loan or to engage further with their bank on suitable arrangements. The BPFI reported, that as of 31 December 2021, approximately 49% of SMEs returned to repaying on the existing term whilst 46% returned to repaying on extended term basis and just over 5% returned on reduced repayments.
The Central Bank has confirmed that there is no regulatory impediment to lenders offering payment breaks to borrowers, providing they are appropriate for the individual borrower circumstance. The BPFI has also reiterated that standard payment breaks continue to be part of the wide range of tailored solutions which are being made available to customers upon assessment of their situation.
SME borrowers have regulatory protections via the Central Bank's SME lending regulations. The SME Regulations set out the required treatment of SMEs by regulated entities in relation to various aspects of business lending. This includes detailed provisions around the credit application process, requirements regarding security or collateral, credit refusals and withdrawals, handling complaints, managing arrears and having in place policies for engaging with SMEs in financial difficulty. The options could include additional flexibility, and this could be a short-term arrangement such as additional periods without payments or interest-only repayments, or if appropriate more long term arrangements. The Central Bank recently wrote to all lenders indicating that lenders are to ensure that they have sufficient expert resources to assess individual borrower circumstances, and to offer appropriate and sustainable solutions to affected borrowers in a timely manner in line with regulatory requirements. The Central Bank’s clear expectation is that lenders engage effectively and sympathetically with distressed borrowers.
In addition, Credit Review, https://www.creditreview.ie, was established to assist those SMEs and farm borrowers that have had credit applications of up to €3 million refused or indeed an existing credit facility withdrawn or amended by the participating bank. SMEs can apply to Credit Review after exhausting the internal appeals process in the participating institution, which are currently AIB, BOI, Ulster Bank and Permanent TSB.
I will continue to work with the Central Bank, as regulator, to ensure that the Central Bank consumer protection and other applicable frameworks will be fully available to all borrowers that will still need support.
200. Deputy Jennifer Murnane O'Connor asked the Minister for Finance his plans to introduce a concession for diesel in haulage similar to the agricultural sector or support schemes for the haulage sector to offset fuel price rises to ensure the growth of the haulage sector; and if he will make a statement on the matter. [11435/21]
View answerThe Diesel Rebate Scheme (DRS) has been continuously in operation since July 2013. This is a scheme for hauliers and bus operators which provides a marginal rate of compensation for the cost of fuel excise when the retail price of auto diesel is relatively high.
The DRS is operated by the Revenue Commissioners, who will repay some of the mineral oil tax paid by a qualifying road transport operator when the diesel is:
- purchased by the business within the state;
- used in the course of business transport activities; and
- used in qualifying motor vehicles.
To qualify for inclusion in the DRS, road transport operators must hold an appropriate road transport licence. This licence must be active in the claim period.
Further information in relation to the operation of the scheme including qualifying criteria, guidelines on the application process and quarterly repayment rates are available on the website of the Office of the Revenue Commissioners at the link below:
https://www.revenue.ie/en/companies-and-charities/excise-and-licences/mineral-oil-tax/diesel-rebate-scheme/index.aspx.
As the Deputy will be aware, VAT registered businesses are also eligible to claim a refund on the VAT paid for diesel used in the course of business activities.
201. Deputy Niall Collins asked the Minister for Finance his views on matters raised in correspondence in the case of a person (details supplied); and if he will make a statement on the matter. [11482/21]
View answerThe Help to Buy (HTB) incentive, is a scheme to assist first-time purchasers with the deposit they need to buy or build a new house or apartment. It also has as a key aim the encouragement of additional supply of new houses by supporting demand. The incentive gives a refund of Income Tax and Deposit Interest Retention Tax (DIRT) paid in Ireland over the previous four years, subject to limits outlined in the legislation.
In addition to the conditions laid down in section 477C Taxes Consolidation Act 1997 (TCA), including that the property is occupied as the sole or main residence of a first time purchaser, section 477C(2) defines a ‘qualifying residence’. The legislation is very specific as to the definition of a qualifying residence. It must be a new building which was not, at any time, used or suitable for use as a dwelling. If the property was non-residential, but has been converted for residential use, it may qualify for HTB. Renovation or refurbishment of old houses to either upgrade or reinstate them for habitation does not qualify for HTB.
In relation to second-hand properties generally, an increase in the supply of new housing remains a priority aim of Government policy. As mentioned above, the HTB scheme is specifically designed to encourage an increase in demand for affordable new build homes in order to encourage the construction of an additional supply of such properties. A move to include second-hand properties within the scope of the relief would not improve the effectiveness of the relief; on the contrary it could serve to dilute the incentive effect of the measure in terms of encouraging additional supply. I have no plans to extend HTB to second-hand properties.
202. Deputy Niall Collins asked the Minister for Finance if he will address a matter raised in correspondence by a person (details supplied); and if he will make a statement on the matter. [11483/21]
View answerThe Temporary Wage Subsidy Scheme (TWSS) was introduced on 26 March 2020 to provide income support to eligible employees where the employer’s business activities were negatively impacted by the COVID-19 pandemic. This scheme ended on 31 August 2020 and was replaced by the Employer Wage Subsidy Scheme (EWSS) from 1 September 2020.
The transitional phase of TWSS operated until 3 May 2020 and provided a subsidy of 70% of the average net weekly pay up to a maximum of €410 in respect of eligible employees. The operational phase of the scheme was introduced from 4 May 2020 and included increased subsidy rates up to 85%, to a maximum subsidy payment of €410. The operational phase also included a tapering mechanism that ensured the subsidy amount plus any additional payment by the employer did not exceed the employee’s ‘normal’ average weekly wage (ARNWP). The ARNWP for each employee was based on the average wages received over the months of January and February 2020.
Under the TWSS, employers were expected to make best efforts to maintain employees’ net incomes for the duration of the scheme. However, there was no requirement in the scheme for employers to pay an additional gross (top-up) payments. That said, participation in the scheme does not affect an employee’s rights and entitlements.
TWSS payments are treated similarly to normal pay for taxation purposes and as such are subject to income tax and the Universal Social Charge (USC). However, the TWSS along with the Pandemic Unemployment Payment (PUP) were not taxed in the normal real-time manner in 2020 and were instead taxed at year end. This arrangement was put in place to ensure payments were available to employees through the scheme as quickly as possible given the urgency and suddenness of the pandemic.
On 15 January 2021, Revenue made a Preliminary End of Year Statement for 2020 available through its online myAccount facility to all PAYE taxpayers, including those who received TWSS and PUP payments. The statement provides employees with a preliminary calculation of the amount of tax and USC paid for 2020 and indicates whether the year is balanced, overpaid or underpaid, before any additional credits such as health expenses are claimed.
Revenue has advised me that the spouse of the person in question received TWSS payments for the months of March, April and May 2020. The spouse’s employer also ‘topped up’ her earnings by varying amounts during that period. The ‘topped up’ amounts were taxed in real-time while the TWSS payments were taxed at year-end. The person’s spouse also received a small amount in tax and USC refunds through her pay during this period, arising from unused tax credits, as well as payments from the Department of Social Protection during the year, which were untaxed at that point.
The person’s Preliminary End of Year Statement shows a liability of €858.67 for 2020. The underpayment is made up of €716.86 in income tax and €141.81 in USC and for the most part arises because the TWSS payments received by his spouse were not taxed until year end. This liability cannot be finalised until the person completes his 2020 Income Tax return and may be reduced if the couple have additional tax credits to claim. If there is still an outstanding liability after any additional tax credits are allocated, the amount due can be collected, interest free, over four years from 1 January 2022 by reducing their tax credits, thereby minimising any financial hardship to the greatest extent possible.
It is important to understand that the amount of tax and USC due by any employee is based on the gross income received during 2020, comprising of, TWSS, any top-up payment made by the employer, and any PUP payments received. The level of top-up wages (if any) paid by the employer to the employee in addition to the TWSS is a matter between both parties. Revenue’s role is to ensure the correct amount of subsidy is paid to the employer and subsequently passed on to the employee and that the correct amount of tax/USC is deducted from the employee based on the total gross earnings received.
Revenue has confirmed that some employers have agreed to pay, on behalf of its employees, underpayments of tax and USC for 2020 that have arisen due to the non-taxation in real-time of TWSS payments. Revenue has facilitated this arrangement by disapplying the benefit in kind rules, in respect of such payments, on an administrative basis. Further details are available at: www.revenue.ie/en/employing-people/twss/employers/index.aspx, which may be of interest to the Deputy.
203. Deputy Pa Daly asked the Minister for Finance the position regarding those travel agency businesses that operate remotely and are thereby excluded from business supports, such as the Covid-19 business aid scheme restrictions support scheme, unlike their peers who operate a customer facing premises while also excluded from the scheme owing to their remote working arrangements that are not rateable premises; and if he will make a statement on the matter. [11508/21]
View answerI wish to advise the Deputy that I have no responsibility for Travel Agents and there are no plans to extend the eligibility criteria for the Covid Restrictions Support Schemes.
Queries in relation to the Covid Business Aid Scheme should be directed to my colleague, the Minister for Enterprise, Trade and Employment.
204. Deputy Pearse Doherty asked the Minister for Finance the status of the legislation providing for the senior executive accountability regime; when it will be published; and if he will make a statement on the matter. [11530/21]
View answerAs the Deputy will be aware, the Programme for Government includes a commitment to introduce a Senior Executive Accountability Regime (SEAR). SEAR will drive positive changes in terms of culture, greater delegation of responsibilities, and enhanced accountability while simplifying the taking of sanctions against individuals who fail in their financial sector roles.
My officials are engaging with the Attorney General's Office in advance of submitting draft heads of Bill to Government so as to ensure that the correct balance is struck between appropriate additional powers for the Central Bank and the protection of individuals' constitutional rights.
My officials continue to consult regularly with the Central Bank throughout this process.
It is my intention that draft heads of Bill will be presented to Government for approval in the near future, and published thereafter.
205. Deputy Pearse Doherty asked the Minister for Finance the action his Department has taken to respond to the application of the VAT margin scheme on second-hand cars imported from Great Britain into Northern Ireland and the competitive disadvantage this creates for retailers here. [11546/21]
View answerUsed cars that are imported into NI from GB after 31 December 2020, under the rules currently in force in the UK are not single market goods and cannot be brought into the State as if they were. Therefore, when they are brought into the State, they are liable for VAT and duty on the same basis as used cars brought into the State from Britain.
