Written Answers Nos. 210-229
210. Deputy Sorca Clarke asked the Minister for Transport the number of workers employed by his Department, and in each office or agency, under the aegis of his Department who earn less than the living wage of €12.30 per hour; and if he will make a statement on the matter. [33600/21]
View answerThere are 41 full-time staff members employed by this Department that earn less than €12.30 per hour. These staff members are currently all on incremental payscales which will see them rise to above the living wage rate after 4 years of service under the provision in the Public Service Stability Agreement for public servants recruited since 2011 to skip their fourth and eighth increments.
I have asked the Agencies under my Department's aegis to provide the information directly to the Deputy. Please contact my private office if a reply has not been received within 10 days.
211. Deputy Fergus O'Dowd asked the Minister for Finance if matters raised by a person (details supplied) will receive a response in respect of the travel agent sector and the very serious cashflow crisis it will face until such time that normal international holiday travel resumes; and if he will make a statement on the matter. [33350/21]
View answerThe Covid Restrictions Support Scheme (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. The support is available to companies, self-employed individuals and partnerships who carry on a trade or trading activities, the profits from which are chargeable to tax under Case I of Schedule D, from a business premises located in a region subject to restrictions introduced in line with the Living with Covid-19 Plan.
Details of CRSS were published 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.
The CRSS applies to businesses carrying on trading activities from a business premises located in a region subject to restrictions, which requires the business to prohibit or considerably restrict customers from accessing their business premises and as a result, is operating at less than 25% of turnover in 2019.
It is not sufficient that the trade of a business has been impacted because of a reduction in customer demand as a consequence of Covid-19. The scheme only applies where, as a direct result of the specific terms of the Government restrictions, the business is required to either prohibit or significantly restrict access to its business premises. This means that in the case of a travel agent that operates from a business premises, they may qualify for support under the scheme provided they meet all the eligibility criteria, including the requirement that customers are either prohibited, or significantly restricted, from accessing their business premises under the public health regulations.
As non-essential retail, including travel agent businesses, were permitted to open from 17 May 2021, they are no longer subject to Covid restrictions which would require them to prohibit or significantly restrict customers from accessing their business premises. Therefore, from that date, they ceased to qualify for support under the CRSS. However, subject to meeting the relevant criteria, a business such as a travel agent business, reopening after a period of restrictions, may claim a “restart week payment” under the CRSS scheme to assist it with the costs of reopening.
For businesses reopening between 29 April 2021 and 1 June 2021, an “enhanced restart week payment” may be claimed, which is computed at double the normal weekly CRSS rate, for two weeks, subject to a maximum weekly amount payable of €5,000.
On 1 June, I announced that an additional business support scheme, the Business Resumption Support Scheme (BRSS), would be available for businesses whose turnover in the period from 1 September 2020 to 31 August 2021 is reduced by 75% compared with their 2019 turnover. 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 BRSS will come into operation from early September. Under the scheme, a qualifying business will be able to claim a cash payment calculated as three times the sum of 10% of their average weekly turnover up to €20,000 and 5% on any excess of average weekly turnover above €20,000, subject to a maximum payment under the scheme of €15,000.
Companies and self-employed individuals may be entitled to support under other measures put in place by Government, including the COVID Pandemic Unemployment Payment (PUP) and the Employment Wage Subsidy Scheme (EWSS). Businesses may also be eligible to warehouse VAT and PAYE (Employer) debts and also excess payments received by employers under the Temporary Wage Subsidy Scheme, and the balance of Income Tax for 2019 and Preliminary Tax for 2020 for self-assessed taxpayers if applicable.
The Government will continue to assess the effects of the Covid-19 pandemic on the economy and I will continue to work with my Ministerial colleagues to ensure that appropriate supports are in place to mitigate these effects.
212. Deputy Martin Browne asked the Minister for Finance his views on a situation in which the owners of a listed thatched building, that comprises a pub and private residence, are having issues in securing building insurance; the measures available to ensure that owners of listed buildings can access affordable insurance in order to protect the historic value of structures; and if he will make a statement on the matter. [33603/21]
View answer218. Deputy Martin Browne asked the Minister for Finance the measures he is taking to ensure that listed properties that have a thatched roof can access affordable insurance; his views on the way some owners of such private or commercial properties are experiencing difficulty in getting a company to insure them; his views on the high costs demanded by insurance companies that will accept thatched properties; his views on the way this difficulty in attaining cover could put the preservation of these properties at risk; and if he will make a statement on the matter. [32942/21]
View answerI propose to take Questions Nos. 212 and 218 together.
The Government is conscious of the difficulties facing owners of thatched properties in relation to affordability and availability of insurance. Having said that, the Deputy will appreciate that, neither I, nor the Central Bank of Ireland, have powers around pricing or provision of insurance cover. These are commercial matters for insurance companies based on an assessment of the risks they are willing to accept and the need to make adequate provisioning to meet these risks. This position is reinforced by the EU framework for insurance (the Solvency II Directive).
Notwithstanding these constraints, insurance reform is high on the Government’s agenda as evidenced by the Action Plan for Insurance Reform. The Action Plan sets out 66 actions which aim to bring down costs for consumers and business; introduce more competition into the market; prevent fraud and reduce the burden that insurance costs can have on business, community and voluntary organisations.
I would like to note that significant progress have been made in this regard. Achievement to date includes:
- The adoption of new Personal Injuries Guidelines by the Judicial Council; and
- The creation of an Office to Promote Competition in the Insurance Market within the Department of Finance.
As the Deputy will know, the new Personal Injuries Guidelines came into effect on 24 April. The Guidelines materially reduce award levels for many categories of common injuries, particularly those of soft tissue. As awards have been reduced, we now expect that insurance premiums should also be reduced. This is a logical consequence and it is also the commitment that the industry has made.
Another key achievement of the reform agenda is the new Office to Promote Competition in the Insurance Market. Since its establishment, the Office has held meetings with wide range of stakeholders including insurance companies, representative bodies, civil society groups and other state regulators on the issues surrounding competition. Minister of State Fleming chairs meetings of the Office which has met on a number of occasions since its establishment and will report on a regular basis to the Cabinet Sub-Group on its progress.
In conclusion, securing a more sustainable and competitive market through deepening and widening the supply of insurance in Ireland remains a key policy priority for this Government. In this regard, it is my intention to continue to work with my Government colleagues to ensure the timely implementation of the Action Plan which will have a positive impact on the affordability and availability of insurance for individuals, businesses, community and voluntary groups across Ireland.
213. Deputy Róisín Shortall asked the Minister for Finance the estimated revenue that would be raised by reducing the standard fund threshold for individual pension benefits from €2 million to €1.7 million; and if he will make a statement on the matter. [32910/21]
View answerThe Standard Fund Threshold (SFT) is the maximum allowable pension fund on retirement for tax purposes, which was introduced in Finance Act 2006 to prevent over-funding of pensions through tax-relieved arrangements. The threshold was initially set at €5 million. It was subsequently reduced to €2.3 million with effect from 7 December 2010 and further reduced to €2 million with effect from 1 January 2014.
Information on the numbers and values of individual pension funds or on individual accrued benefits are not generally required to be supplied to Revenue by the administrators of pension schemes and personal pension arrangements. There is, therefore, no underlying data available to Revenue on which to base reliable estimates of the savings that would arise specifically from the change to the SFT indicated in the question.
214. Deputy Róisín Shortall asked the Minister for Finance the estimated additional revenue that would be raised through the introduction of the interest limitation rule as per the EU Anti-Tax Avoidance Directive for which Ireland currently has a derogation; and if he will make a statement on the matter. [32911/21]
View answerDrafting of the legislation to transpose the interest limitation rule or ILR mentioned by the Deputy is ongoing, which makes it difficult to provide a definitive estimate of its likely Exchequer impact. I would also note that the primary purpose of the measure is to improve the robustness of the international corporate tax system as a whole by preventing base-erosion and profit shifting through the use of excessive interest expenses. Therefore, while it is expected that the measure will generate some yield, a measure of its success will also be the prevention of BEPS activities rather than the raising of Exchequer revenue.
A number of other factors set out below also give rise to difficulty in estimating a yield.
First, the ILR is a generic, fixed ratio-based limit on current year interest deductibility, without general or targeted anti-avoidance rules. By contrast, Ireland’s existing comprehensive set of rules on borrowings and interest deductibility have evolved over time to combat abusive practices and provide strong protection to the Exchequer. For this reason I have decided to largely retain our underlying interest rules and introduce the ILR as an additional measure, which is designed to work with the continuing protections afforded by existing domestic legislation.
In addition, our transfer pricing legislation ensures that tax relief is only available for an arm’s length amount of interest. The “arm’s length principle” is an internationally agreed standard that requires related party transactions to be priced as if they were carried out by unrelated parties dealing at arm’s length.
Furthermore, while our existing interest rules permanently disallow non-qualifying interest, the ILR permits the deferral of excessive interest charges, so that amounts disallowed in one year may qualify as a deduction in a later year, subject to conditions.
Finally, Ireland’s long-standing general anti-avoidance rule ensures that Revenue is empowered to counteract tax avoidance in Ireland that is not caught by a specific anti-avoidance provision.
Having regard to the measure's objective of preventing excess interest charges, and taking into account the protections afforded by pre-existing domestic legislation, the ILR carry-forward provisions and the fact that drafting of the ILR legislation is still ongoing, it is not possible at this time to predict a specific yield from the ILR.
215. Deputy Róisín Shortall asked the Minister for Finance the expected net effect of measures carried over for 2022 as a result of budget 2021 measures; the way in which carryover is accounted for in the budgetary stance projections; and if he will make a statement on the matter. [32930/21]
View answerThe net carryover effect into 2022 of taxation measures introduced in Budget 2021 was estimated to be in the region of €0.4 billion.The majority of this figure related to the conclusion of the reduced 9% VAT rate for the tourism sector, which was due to expire at end-2021, with some carryover impact into the following year.
As the Deputy will be aware, the Government announced in the Economic Recovery Plan that the reduced VAT rate for the tourism sector will be extended until September 2022. The estimated additional cost of this extension is €350 million. As a result, the net carryover effect of Budget 2021 taxation measures has been reduced by the same amount.
The net carryover effect into next year of Budget 2021 expenditure measures has not yet been published and will be considered as part of the estimates process.
216. Deputy Róisín Shortall asked the Minister for Finance the expected revenue yield from an increase in excise on diesel of five cent per litre; the expected cost of using the diesel rebate scheme to offset such an increase for commercial transport;; and if he will make a statement on the matter. [32931/21]
View answerI am advised by Revenue that the estimated yield from increasing the Excise on diesel by a range of amounts is shown on page 22 of Revenue’s Ready Reckoner which can be located at the following link: https://www.revenue.ie/en/corporate/documents/statistics/ready-reckoner.pdf. The yield from a five cent per litre increase is estimated at €137m per annum.
Based on the volume of diesel on which claims were received in previous years, the cost of using the Diesel Rebate Scheme to offset a 5c increase for qualifying commercial transport is estimated to be in the region of €20 million.
217. Deputy Róisín Shortall asked the Minister for Finance the adjustment made for indexation of income tax bands and income tax rates when calculating the budgetary stance for Budget 2022; the estimated additional savings that could be made by not indexing income tax bands and income tax rates; and if he will make a statement on the matter. [32932/21]
View answerThe Programme for Government, “Our Shared Future”, states that “from Budget 2022 onwards, in the event that incomes are again rising as the economy recovers, credits and bands will be index linked to earnings. This will be done to prevent an increase in the real burden of income tax, to prevent more low income workers being taken into the tax net because of no changes to the tax system and to ensure there is no increase in the number of people having to pay higher income tax and USC rates”.
The Summer Economic Statement (SES), which will be published in the coming weeks, will include a high level update to the fiscal forecast published in April, taking into account the measures announced in the Economic Recovery Plan. The SES will also set-out a budgetary framework within which Budget 2022 can be delivered.
In general, consideration of any changes to the income tax rates and bands are undertaken within the annual Budgetary and Finance Bill process. As is normal, the Deputy will appreciate that I cannot comment on any possible changes in advance of Budget 2022, as any decisions in this regard will have to be considered within the overall Budgetary context, as well as the ongoing effects of Covid-19 on the economy.
That said, I will continue to assess the effects of the Covid-19 pandemic on the economy, and monitor the labour market and wage growth, with a view to ensuring that the broader tax system is as fair and equitable as possible.
For the information of the Deputy, page 9 of Revenue’s post-Budget 2021 Ready Reckoner, published in November 2020, includes the estimated cost of indexation at 1%, across various tax credits and bands, as well as USC band rates and exemption limits. This information is set out in the table below or available at the following link - https://www.revenue.ie/en/corporate/documents/statistics/ready-reckoner.pdf
|
Cost of Indexation at 1% |
First Year €m |
Full Year €m |
|
Personal Tax Credits with rate bands |
104 |
120 |
|
Exemption limits, Personal Tax Credits with rate bands |
109 |
125 |
|
PAYE Credit, Exemption limits, Personal Tax Credits with rate bands |
139 |
160 |
|
Earned Income Credit |
1 |
2 |
|
USC Rate Bands and Exemption Limits |
18 |
21 |
219. Deputy Imelda Munster asked the Minister for Finance if he plans to consider an extension of the employment wage subsidy scheme to 31 March 2022 and the continuation of the reduced rate of employers' PRSI relief for businesses that continue to need these supports; and if he will make a statement on the matter. [32967/21]
View answerSection 28B of the Emergency Measures in the Public Interest (Covid-19) Act 2020 provides for the operation of the Employment Wage Subsidy Scheme (EWSS), which is an economy-wide enterprise support for eligible businesses in respect of eligible employees. It provides a flat-rate subsidy to qualifying employers based on the numbers of paid and eligible employees on the employer’s payroll and charges a reduced rate of employer PRSI of 0.5% on wages paid which are eligible for the subsidy payment.
The objective of the Employment Wage Subsidy Scheme (EWSS) is to support 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, payments of over €3.5 billion and PRSI credit of over €575 million have been granted to 50,000 employers in respect of 583,000 workers.
I have been clear that there will be no cliff-edge to the EWSS and, as the Deputy will be aware from announcements made on Tuesday 1st June, it has been decided that the scheme is now to be extended until the end of December 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 December 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).
For Q3 2021, the Government has decided to broadly maintain the status quo for EWSS, including the enhanced rates of support, with a modification to widen eligibility, and maintaining the reduced rate of Employers’ PRSI of 0.5%.
While the Government has agreed that the EWSS should be extended to end Q4 2021, it is too early as yet to prescribe the precise operational parameters of the scheme that should apply for that quarter. Decisions in that regard will be taken closer to the time, possibly around the end of August/early September, with the benefit of more up-to-date information on a number of variables, including the overall epidemiological situation, progress made in reopening all sectors of the economy, the vaccine efficacy, as well as the operation of the EWSS during the early parts of Q3.
Similarly, no decisions have been taken in relation to future of the scheme beyond the end of Q4, 2021.
It is important that, as the recovery gains further momentum, supports are further recalibrated in the longer-term interests of businesses that are in receipt of those supports and in the interests of the wider body of taxpayers. As such, and as already signalled, for Q4, consideration will be given to a future change to EWSS which will require an employer contribution towards employee wages. The precise manner in which such a change might be implemented is a matter to be considered.
Finally, for those businesses who may need additional support during this period, I would draw attention to the comprehensive package of other business and employer supports that have been made available since the July Stimulus Plan and Budget 2021 - including the Covid Restriction Support Scheme (CRSS) which has been extended, the Credit Guarantee Scheme, the SBCI Working Capital Scheme, Sustaining Enterprise Fund, and the Covid-19 Business Loans Scheme. I also announced on 1st June a new additional business support scheme (Business Resumption Support Scheme or BRSS) for businesses with reduced turnover as a result of public health restrictions to be implemented in September 2021.
The Government remains fully committed to supporting businesses and employers insofar as is possible at this time.
220. Deputy Neale Richmond asked the Minister for Finance the number of persons paying professional services withholding tax in 2018, 2019 and 2020; the overall amount of tax paid by way of the tax for each of those years; the average amount of the tax paid by persons who fall into this category; and if he will make a statement on the matter. [32993/21]
View answerI am advised by Revenue that the table below sets out the amounts collected in Professional Services Withholding Tax (PSWT) for the years 2018, 2019 and 2020. The table also sets out the number of persons that paid PSWT during those years and the average amount paid.
|
Year |
Gross Collection (€m) |
No. of Customers |
Average (€m) |
|
2018 |
€689 |
460 |
€1.50 |
|
2019 |
€728 |
452 |
€1.61 |
|
2020 |
€783 |
450 |
€1.74 |
221. Deputy Paul McAuliffe asked the Minister for Finance if he is considering amending the help-to-buy scheme to include the best four of the past five years of PAYE income given the impact of Covid-19 and the large number of persons who received the pandemic unemployment payment thus paying less tax than in previous years; and if he will make a statement on the matter. [33017/21]
View answerThe Help to Buy (HTB) incentive is a scheme to assist first-time purchasers with a deposit they need to buy or build a new house or apartment. The incentive gives a refund on Income Tax and Deposit Interest Retention Tax (DIRT) paid in the State over the previous four years, subject to limits outlined in the legislation.
Section 477C Taxes Consolidation Act (TCA) 1997 outlines the definitions and conditions that apply to the HTB scheme.
HTB claimants may select all or any of the previous four tax years for the purposes of calculating the HTB refund. For the purposes of the HTB scheme, a tax year is considered January to December of the relevant year. Where an applicant has only paid Income Tax for part of a tax year (e.g. if only worked August to December), the applicant may still choose that year as a relevant tax year for the purposes of the HTB scheme, and any Income Tax / DIRT paid during that year will be included in the HTB refund calculations, subject to the limits outlined in legislation.
The Revenue Tax and Duty Manual Part 15-01-46, available at www.revenue.ie/en/tax-professionals/tdm/income-tax-capital-gains-tax-corporation-tax/part-15/15-01-46.pdf, outlines further guidance on the conditions and operation of the Help to Buy scheme including details of how the payment is calculated.
The refund period covering the previous four tax years as set out in the HTB legislation is linked to the general time limits on repayments of tax that are contained in section 865 TCA 1997. This section provides that claims for repayment of tax will not be allowed unless the claim is made within four years of the end of the period to which the claim relates.
However, the Deputy may wish to be aware that, as regards the negative impact of Covid-19 related restrictions on employment and the ability to qualify for HTB, Revenue have advised that where an underpayment of tax arises for the year 2020 as a result of amounts received under the TWSS or PUP, Revenue will allow a claim for HTB relief for the amount of income tax paid for 2020 and will not require the outstanding tax liability to be paid in advance where the underpayment of tax is due to be collected from 2022 by reducing the claimant’s tax credits. This will only apply where all other conditions of the HTB scheme are satisfied.
The future of the HTB scheme beyond its current sunset date of 31 December 2021 is a matter that will fall to be considered in the context of Budget 2022 and the subsequent Finance Bill.
222. Deputy Richard Bruton asked the Minister for Finance if he will consider relief on local property tax in cases in which 22.5% of the family home has been assigned to the HSE under the fair deal nursing homes support scheme; and if he will make a statement on the matter. [33038/21]
View answerThe 2012 inter-Departmental Group which considered the structures and modalities of a property tax recommended that a universal liability to the Local Property Tax (LPT) should apply to all owners of residential property with a limited number of exemptions. Limiting the exemptions available allows the rate to be kept low for those liable persons who do not qualify for an exemption. While there is no specific exemption from the requirement to pay LPT in cases as described in the deputy's question, the owners of such properties may be entitled to an exemption on other grounds or may qualify for a deferral subject to meeting the qualifying conditions.
Further information is available on Revenue website www.revenue.ie/en/property/local-property-tax/index.aspx.
223. Deputy Colm Burke asked the Minister for Finance if he has legislative plans to ensure equal access to financial services and products for cancer survivors in view of circumstances in which cancer survivors, particularly those who suffered cancer at a young age, are being denied access to mortgages, bank loans or insurance (details supplied); and if he will make a statement on the matter. [33183/21]
View answerI am keenly aware of the issue of equal access to financial services and products for those who previously have had cancer, and note the statistics supplied, which relate to difficulties experienced by some in accessing life insurance. I am also aware of reports of some customers experiencing issues in obtaining mortgage protection cover as a result of having higher risk conditions particularly in the context of COVID-19, however this usually relates to certain chronic conditions.
With regard to insurance, it should be noted that neither I, nor the Central Bank of Ireland, can intervene in the provision or pricing of insurance products or have the power to direct insurance companies to provide cover to specific individuals or businesses. This position is reinforced by the EU framework for insurance (the Solvency II Directive). Consequently, I am not in a position to direct companies as to what terms and conditions apply in relation to cover.
However, I have asked my officials to examine this and to engage with Insurance Ireland, the representative body for the insurance industry in this country, so as to assess the extent of the issue in Ireland for cancer survivors, and if it has become more prevalent in the context of the COVID-19 pandemic. In doing this work, they will also assess the legislative measures taken in the jurisdictions mentioned, including their application and scope. My officials will also monitor any relevant developments at the EU level as part of their work on this issue, and in this context, I understand that the European Commission published a Plan, “Europe’s Beating Cancer Plan”, last February, which includes an initiative for 2021-2023 to “Address fair access for cancer survivors to financial services (including insurance), via a code of conduct and a reflection on long-term solutions”.
On the issue of access to mortgage protection cover, Insurance Ireland has indicated that while most customers are still able to get life; critical illness; or mortgage protection insurance, it is aware of a small number of individual cases where a final decision on some applications is being postponed for a period where applicants have a COVID-19-related health condition. However, it stated that while unaware of any cases where life cover has been denied, such policies are assessed on a case-by-case basis and that underlying health conditions are taken into account by the underwriters, as was the case pre-COVID-19.
Separately, my officials recently engaged on the issue of mortgage protection insurance with the Banking and Payments Federation Ireland (BPFI). From correspondence received, the BPFI has indicated that only 0.05% of mortgage applications approved by its members did not proceed to draw-down due to a lack of mortgage protection insurance. Moreover, it is my understanding that under Section 126 of the Consumer Credit Act 1995, lenders can provide a mortgage in situations where a borrower may be unable to obtain mortgage protection insurance, or where such insurance is unduly costly compared to that payable by borrowers generally.
Where a consumer feels that they are being treated unfairly, they have the option of making a complaint to the Financial Services and Pensions Ombudsman (FSPO). The FSPO is a statutory official who acts as an independent arbiter of disputes which consumers may have with their insurance company or other financial service provider. The FSPO can be contacted either by email at info@fspo.ie or by telephone at 01-567-7000.
Finally, it is also worth noting that Insurance Ireland operates a free Insurance Information Service for those who have queries, complaints or difficulties in obtaining insurance, and it can be accessed at feedback@insuranceireland.eu.
224. Deputy Noel Grealish asked the Minister for Finance the State agencies, organisations or boards under the responsibility of his Department, or that receive funding from his Department, that have been charged interest for savings on deposit in Irish banks since negative interest rates were introduced; the amount of interest that has been charged to each State agency, organisation or board; and if he will make a statement on the matter. [33313/21]
View answerA number of the bodies under the aegis of my Department have incurred negative interest rate charges in Irish banks, details of which are set out below.
Home Building Finance Ireland (HBFI) was established in December 2018, at which time there was a requirement to open a number of accounts to allow day to day operations and activities to be undertaken. Since December 2018, HBFI has been charged a total of €39,345 in negative interest for savings on deposit in Irish banks.
The Financial Services and Pensions Ombudsman (FSPO) has been charged €35,700 in negative interest since its establishment on 1 January 2018. Since 2019, the FSPO has issued levy notices at various points throughout the year, in order to reduce moneys held on deposit at any one time and therefore reduce negative interest charged. In addition, superannuation contributions relating to the FSPO’s Model Pension Schemes are held on deposit, adding to the negative interest charged. The FSPO has taken all possible actions to reduce/avoid negative interest and is monitoring rates charged on an ongoing basis.
The National Asset Management Agency has incurred negative interest rate costs of €127,035 to date.
The National Treasury Management Agency has incurred negative interest charges of €243,452 on its accounts with core Irish retail banks since 2018.
Since 2014, the Office of the Revenue Commissioners’ overnight balances held on deposit generated negative interest charges of €4.39 million. The amounts held on deposit increased during 2020 and 2021 (to date) to fund certain COVID-19 related subsidy schemes managed by Revenue.
225. Deputy Richard Boyd Barrett asked the Minister for Finance the estimated amount that could be raised by abolishing the Special Assignee Relief Programme, which was introduced in 2014 to provide a tax reduction to high earning persons who locate to Ireland for work purposes; and if he will make a statement on the matter. [33417/21]
View answerThe latest costs available for the Special Assignee Relief Programme (SARP), can be found in the 'Statistics on Special Assignee Relief Programme 2018' report which is published on the Revenue website.
According to that report, in 2018 SARP had an Exchequer cost of €42.4 million. This is the latest data available. I expect the cost for 2019 should be available later in the year.
The annual cost of the Special Assignee Relief Programme (SARP) for 2012 to 2018 (the most recent year for which data are available) is as follows:
|
Year |
€m |
|
2012 |
0.1 |
|
2013 |
1.9 |
|
2014 |
5.9 |
|
2015 |
9.5 |
|
2016 |
18.1 |
|
2017 |
28.1 |
|
2018 |
42.4 |
It is not possible to estimate with any degree of reliability the likely savings that would accrue to the Exchequer in 2021 or in the years beyond that if the SARP were abolished. The reason for this is that there are currently no data available that would enable such a calculation to be made. The Deputy will be aware that in Finance Bill 2018 I re-imposed an upper salary ceiling of €1 million on the relief with effect from 1 January 2019 for new entrants and for existing beneficiaries of the programme from 1 January 2020. Such data as are available within the system relate to years before 2019 (no cap existed between 2015 and 2019). It would therefore be necessary to assess the cost-saving impact of this cap as well as taking account of the evolution in the take up of the relief during the current year in order to estimate the savings that might arise in 2021 from the abolition of the programme.
Finally, it should also be kept in mind that any estimation exercise of the type mentioned by the Deputy might also need to take into account changes in behaviour, including the loss of income tax from SARP-related jobs that may no longer arise, and the economic benefit provided by the relief.
226. Deputy Richard Boyd Barrett asked the Minister for Finance the estimated amount that could be raised from eliminating the refundable nature of the unused element of the research and development tax credit for corporations; and if he will make a statement on the matter. [33418/21]
View answerI am advised by Revenue that is not possible to accurately predict the yield from ending the payable element of the Research and Development (R&D) tax credit, as information in respect of the future payments of the credit, which is dependent on both the future profitability of claimant companies as well as their level of qualifying R&D activity, cannot be known in advance.
However, I am advised by Revenue that information in respect of the R&D tax credit is available at: https://www.revenue.ie/en/corporate/information-about-revenue/statistics/tax-expenditures/r-and-d-tax-credits.aspx. This includes the cost of payable tax credits for recent years. The most recent year for which returns information is available presently is 2019.
227. Deputy Ged Nash asked the Minister for Finance if his attention has been drawn to the issues that arise in terms of the ability of the Financial Services and Pensions Ombudsman to investigate complaints against financial institutions in situations in which joint accounts may be involved and the consent to allow the Ombudsman to investigate matters may be withheld by one party; his views on whether the relevant legislation should be reviewed to allow certain cases to be investigated by the Ombudsman in cases in which one party may decide to withhold their consent; and if he will make a statement on the matter. [33427/21]
View answerFirstly, I must point out that the Financial Services and Pensions Ombudsman (FSPO) is independent in the performance of his statutory functions. I have no role in the day to day workings of the office or in the decisions which he takes.
I am advised that where a complaint is made to the FSPO concerning a joint account or a joint policy, the FSPO must recognise that all parties to the account or policy have rights, entitlements and potential liabilities arising in relation to such an account or policy, and in addition certain data protection issues arise. Whether the complaint is settled by way of agreement between the parties, using the confidential Dispute Resolution Services of the FSPO, or is the subject of a formal investigation by the FSPO, leading to a legally binding decision, the rights and obligations of all joint account holders or joint policyholders are thereby affected. All owners of the account or policy must therefore be agreeable to the investigation of the complaint by the FSPO, and the submission of their personal data to the FSPO. Therefore their signature is required as evidence of their consent.
If a complainant indicates a difficulty in securing the signature of another party to an account or policy, the FSPO reviews the individual circumstances to form an understanding as to the reason for the difficulty, and where possible offers guidance as appropriate, as to what options may be available. The FSPO fully recognises the difficulty for complainants who cannot obtain the agreement of another party to the investigation of a complaint. The FSPO must however respect the rights and entitlements of all parties to an account or policy.
228. Deputy Eoin Ó Broin asked the Minister for Finance the number of dog breeding establishments with tax registration numbers. [33438/21]
View answerAs I stated in my reply to PQ 30710 of 15 June, Revenue uses a European standard classification system, known as ‘NACE’ to categorise the economic activities or sectors of taxpayers. In the NACE system, dog breeding or dog selling are not separately categorised. In addition, these types of operations are often part of wider economic activities undertaken by taxpayers and it is therefore not possible for Revenue to identify or report on the registrations specifically by dog breeding.
229. Deputy Gary Gannon asked the Minister for Finance if his attention has been drawn to the lack of transparency surrounding special tax arrangements for multinational companies that Irish companies operating within the same sector cannot avail of; and if he will make a statement on the matter. [33558/21]
View answer230. Deputy Gary Gannon asked the Minister for Finance if there is a special tax arrangement for larger corporations or market dominant players that allow them to pay a minimal amount of tax to the Exchequer; if his attention has been drawn to any such arrangement; and if he will make a statement on the matter. [33559/21]
View answerI propose to take Questions Nos. 229 and 230 together.
It is unclear what the Deputy is referring to and if he has any specific concerns, I will be happy to address those if further details can be provided. However, I can assure him that Ireland has a clear and transparent statutory corporation tax regime that applies to all companies equally and raises billions in revenue each year. Taxable trading income is taxed at 12.5% in Ireland, one of the most competitive headline rates of corporation tax in the OECD. This rate is applied to a broad base – a policy which is endorsed by the likes of the OECD because it is good for economic growth. In many countries, a high statutory rate is mitigated by its application to a relatively narrow base, so producing a lower effective rate. By contrast, Ireland’s effective tax rate of between 10% and 11% is close to the 12.5% headline rate and the difference relates to a small number of targeted tax measures provided for in legislation.
Furthermore, Revenue has no authority to depart from or supersede the law. Revenue’s Tax and Duty Manual Parts 37-00-00a and 37-00-40 outline the procedures to be followed where taxpayers are seeking Revenue’s advance confirmation as to how a transaction will be treated for tax purposes, based on the relevant legislation. As Revenue publishes detailed guidance, opinions should only be required in relatively limited circumstances. Nevertheless, any opinions given by Revenue are not legally binding and it is open to Revenue officials to review the position when a transaction is completed and all the facts are known.
Finally, Revenue analysis shows that foreign-owned multinationals were responsible for €9.7 billion (82%) of net corporation tax receipts in 2020 and Irish-owned multinationals accounted for €0.8 billion (7%) of net corporation tax receipts. Non-multinationals paid €1.3 billion or 11%. Revenue analysis of 2019 tax returns also show that foreign-owned multinationals accounted for over 2.4 million employments in companies with combined income tax, USC and PRSI payments for these employees of €21.5 billion. Foreign multinationals account for 32% of employment and 49% of employment taxes. In 2019, Revenue calculated the average effective tax rate for all companies as 10.3% while for foreign owned multinationals it was 11.1%.
