Written Answers Nos. 310-326
310. Deputy Fergus O'Dowd asked the Minister for Finance if a response will issue in relation to queries raised by a person (details supplied) and local business owner who has been denied access to the Covid restrictions support scheme; if the appropriate advice and assistance will be provided in the case; and if he will make a statement on the matter. [39550/21]
View answerThe 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: www.revenue.ie/en/corporate/press-office/budget-information/2021/crss-guidelines.pdf.
To qualify under the scheme a business must, under specific terms of the Covid restrictions, be required to either prohibit or significantly restrict, customers from accessing their business premises to acquire goods or services, with the result that the business either has to temporarily close or to operate at a significantly reduced level. A business must be able to demonstrate that, because of the Covid restrictions, the turnover of the relevant business activity during the period of restrictions will be no more than 25% of the “relevant turnover amount”.
The “relevant turnover amount” is calculated by reference to a business’s average weekly turnover for the relevant business activity in a prior period, the identification of which period depends on whether the business is an “established business” or a “new business”. An established business is a business that commenced trading prior to 26 December 2019 and the relevant turnover amount for such a business is based on average weekly turnover in 2019. A new business is a business that commenced between 26 December 2019 and 12 October 2020 and the relevant turnover amount for such a business is based on average weekly turnover in this period.
If an established business or a new business does not have any turnover in the applicable reference period, such that it does not have any reference turnover amount, the business will not be entitled to make a claim under the scheme. Having a turnover figure in the reference period is a key anchor of CRSS – it is used for the purposes of establishing that the necessary reduction in turnover is met and also to calculate any payment which may be due under the scheme.
CRSS is one of a number of supports introduced by the Government to assist businesses impacted by COVID-19. A business that does not qualify for CRSS may be entitled to financial support under other measures put in place by the Government, including the Employment Wage Subsidy Scheme (EWSS). The business may also be eligible under the Debt Warehousing Scheme to ‘park’ certain VAT and PAYE (Employer) liabilities and any excess payments received under the Temporary Wage Subsidy Scheme (TWSS).
Deputies will also be aware of the Business Resumption Support Scheme, details of which are set out in Section 5 of the recently enacted, Finance (COVID-19 and Miscellaneous Provisions) Act 2021. The BRSS will be implemented in September 2021. This scheme is being introduced for vulnerable but viable businesses, particularly in sectors that were significantly impacted throughout the pandemic, even during periods when restrictions were eased. Businesses whose turnover is reduced by 75% in the reference period will be eligible. The reference turnover amount is calculated by having regard to when the business commenced; For the purpose of the scheme an established relevant business activity is a business activity trading throughout 2019 or a business commenced up to 9 March 2020, while a new relevant business activity is a business commenced between 10 March 2020 but before 26 August 2020.
The scheme will not be restricted by location, rate-paying or physical premises. Businesses will be eligible to apply for a once-off payment based on a percentage of their average weekly turnover for 2019, subject to a maximum payment of €15,000, provided they meet the qualifying criteria.
311. Deputy Fergus O'Dowd asked the Minister for Finance if a response will issue in relation to matters raised by a person (details supplied) regarding the insurance market; if his attention has been drawn to such an issue; the measures he is taking to ensure this does not take place; and if he will make a statement on the matter. [39558/21]
View answerAt the outset, it is important to note that neither the Minister for Finance, nor the Central Bank of Ireland, has any influence over the pricing or provision of insurance products, as this is a commercial matter assessed on a case-by-case basis. This position is reinforced by the EU legislative framework for insurance (the Solvency II Directive). Furthermore, I cannot comment on individual cases or comments made by an individual broker, such as those referred to with the Deputy’s question.
As committed to in the 2020 Programme for Government, Government is prioritising reform of the sector with particular emphasis on motor, public, and employer liability insurance. The whole-of-Government approach, being taken through the Action Plan for Insurance Reform, therefore sets out 66 actions, which aim to improve both the cost and availability of this key financial service, particularly for businesses. In this regard, I welcome the implementation of the Personal Injuries Guidelines, which represents a key achievement of this insurance reform agenda, and was realised several months ahead of schedule.
The Guidelines significantly reduce award levels for many categories of common injuries. Of note is that a number of these will now move to the jurisdiction of the District rather than the Circuit Court, thus reducing associated legal fees. The Guidelines also provide guidance in relation to injuries previously not included in the Book of Quantum and will be used by both the Personal Injuries Assessment Board (PIAB) and the judiciary. Therefore, they should help to bring more certainty to claimants and insurers, and as such reinforce the benefits of using the PIAB to settle claims. This in turn should further reduce the costs of claims, particularly legal fees. I have previously set out my view that these costs, rather than the profit component, tend to represent a bigger factor in the cost of insurance premiums. As such, it is important that they are lowered.
As Minister for Finance, my expectation is that insurers will now commence reflecting savings from reduced award levels to customers, in line with past commitments, and I intend to hold them to account on this. Minister of State Fleming met with the CEOs of the main insurers operating in Ireland to set out the Government’s expectation in this regard. These engagements were positive, with insurers indicating that they will begin lowering premiums in response to the Guidelines. The Minister of State will meet the CEOs again later this year to review their ongoing response to this and other key reforms. Work is also underway to help improve transparency through the National Claims Information Database, so that the impact of the Guidelines can be seen in future motor, employer and public liability reports.
In relation to recent price changes for insurance, I would note that, according to Central Statistics Office (CSO) data for June 2021, motor insurance prices are continuing to decline. Motor insurance prices in June were 34.5% lower than their peak in July 2016; and 5.3% lower than when the Government’s Cabinet Committee Sub-Group on Insurance Reform was established in September 2020.
I would like to assure the Deputy that work remains ongoing across Government to deliver further elements of the Action Plan, including measures to reform the PIAB, reduce fraud, and make changes to the duty of care in order to strengthen waivers and notices. It is my hope that the implementation of these key actions in particular should further help to improve the affordability and availability of insurance for all consumers, businesses and voluntary groups. Finally, while it is not possible to comment on the specifics of any case, I continue to expect that insurers will treat customers fairly and where this is not the case, I encourage consumers to raise the matter if appropriate with the Financial Services and Pensions Ombudsman.
312. Deputy Richard Boyd Barrett asked the Minister for Finance if it can be guaranteed that any remedial work carried out to tackle the major problem of fire and structural defects in the country’s apartments and duplexes will be covered by tax relief to the persons affected; if so, the timeframe for such relief; and if he will make a statement on the matter. [39562/21]
View answer454. Deputy Cormac Devlin asked the Minister for Finance if he will consider introducing tax relief for owner-occupiers and social landlords of defective apartments in Budget 2022, while they await the report of the Working Group on Defective Homes; if he will consider making any recommendations from the Working Group retrospective to allow property owners who have carried out works in the recent past access the scheme; and if he will make a statement on the matter. [41420/21]
View answerI propose to take Questions Nos. 312, 454, 611 and 643 together.
An Independent Working Group to examine the issue of defective housing has been established and will publish a report on their findings. Officials from my Department participate in this Working Group. The objectives of the group are to identify the scope of relevant significant defects in housing, to evaluate the scale of housing affected, to propose a means of prioritising defects, to evaluate the cost of remediation, to recommend appropriate mechanisms for resolving defects and, to consider financing options in line with the Programme for Government commitment to identifying options for those impacted by defects to access low-cost, long-term finance.
With regard to any recommendations for Government to introduce tax expenditure measures that may arise from the Working Group's report, retrospective or otherwise, such proposals would be assessed in accordance with my Department's Tax Expenditure Guidelines. These make clear that it is important that any policy proposal which involves tax expenditures should only occur in limited circumstances, for example where there are demonstrable market failures. In particular, they provide that a tax-based incentive should only be considered where it would be more efficient than a direct expenditure intervention. The introduction of such measures is a matter that would fall to be considered in the context of the annual Budget and Finance Bill.
313. Deputy Niall Collins asked the Minister for Finance the status of the review in relation to the primary medical certificate; and if he will make a statement on the matter. [39710/21]
View answerThe Disabled Drivers & Disabled Passengers Scheme provides relief from Vehicle Registration Tax and VAT on the purchase and use of an adapted car, as well as an exemption from motor tax and an annual fuel grant. The cost of the scheme in 2020, excluding motor tax, was €67m.
The Scheme is open to severely and permanently disabled persons as a driver or as a passenger and also to certain charitable organisations. In order to qualify for relief, the applicant must hold a Primary Medical Certificate issued by the relevant Senior Area Medical Officer (SAMO) or a Board Medical Certificate issued by the Disabled Driver Medical Board of Appeal. Certain other qualifying criteria apply in relation to the vehicle, in particular that it must be specially constructed or adapted for use by the applicant.
To qualify for a Primary Medical Certificate an applicant must be permanently and severely disabled. The terms of the Disabled Drivers and Disabled Passengers (Tax Concessions) Regulations 1994 set out six medical criteria, at least one of which is required to be satisfied in order to obtain a Primary Medical Certificate.
A Supreme Court decision of 18th June 2020 found in favour of two appellants against the Disabled Drivers Medical Board of Appeal's refusal to grant them a Primary Medical Certificate. The judgement found that the medical criteria set out in the Regulations did not align with the regulation making mandate given in the primary legislation to further define criteria for ‘severely and permanently disabled’ persons.
On foot of the legal advice received, it became clear that it was appropriate to revisit the six medical criteria set out in Regulation 3 of Statutory Instrument 353 of 1994 for these assessments. In such circumstances, PMC assessments were discontinued until a revised basis for such assessments could be established. The medical officers who are responsible for conducting PMC assessments need to have assurance that the decisions they make are based on clear criteria set out in legislation. While Regulation 3 of Statutory Instrument No. 353 of 1994 was not deemed to be invalid, nevertheless it was found to be inconsistent with the mandate provided in Section 92 of the Finance Act 1989.
In order to allow for the PMC assessments to recommence I brought forward an amendment to the Finance Bill to provide for the existing medical criteria in primary legislation. Following approval of the Finance Act 2020, medical assessments recommenced from 1st January 2021.
I consider this to be an interim solution only. While I am very aware of the importance of this scheme to those who benefit from it, I am also aware of the disquiet expressed by members of this house and others in respect of the difficulties around access to the scheme. With this in mind I have asked my officials to undertake a comprehensive review of the scheme, to include a broader review of mobility supports for persons with disabilities, and on foot of that review to bring forward proposals for consideration.
Department officials have been carrying out preliminary work, including an examination of the main issues which will frame the scope of the review. Officials have also been engaging with other Departments in the context of other ongoing work in mobility supports. In particular, the Department has engaged with the Department of Children, Equality, Disability, Integration and Youth in the context of a working group established early last year by the Minister for Justice before the work was interrupted by the Covid-19 pandemic. The group, under the National Disability Inclusion Strategy 2017-2021, was tasked with a review of transport supports encompassing all Government funded transport and mobility schemes for people with disabilities, to enhance the options for transport to work or employment supports for people with disabilities and to develop proposals for development of a coordinated plan for such provision.
It is envisaged that the review group will be established shortly and will include stakeholders from other Departments, the Disabled Drivers Medical Board of Appeal and other representative groups.
Finally, I would like to clarify that the Scheme itself is still operating. All persons or charitable organisations that can currently access the Scheme will continue to be able to do so and make claims for tax reliefs and the fuel grant in the normal manner.
314. Deputy Brian Stanley asked the Minister for Finance if he will authorise the appointment of additional appeals commissioners for the Tax Appeals Commission; and if the existing temporary appeals commissioners will clear the backlog of appeals. [39741/21]
View answerIt is assumed that the Deputy is referring to the proposal by the Chairperson of the Tax Appeals Commission (TAC) for a new tiered structure of Appeal Commissioners.
It has become clear since the establishment of the TAC that there is a significant range in both the value and complexity of the appeals received by the TAC and, in March of this year, the TAC Chairperson submitted a proposal to my Department to introduce a new tiered structure of Appeal Commissioners, to be responsible for appeals of differing value and/or complexity. This would allow for a more cost-effective allocation of resources within the TAC, and thereby should improve the efficacy of the appeal system for taxpayers.
I have approved the proposal for the new tiered structure and my officials have been engaging with the Department of Public Expenditure and Reform to secure the necessary sanctions for the new structure. The sanctions were agreed this month, and the steps necessary to commence recruitment are now being undertaken.
The Tax Appeals Commission receives approximately 1,500 new tax appeals each year and it is not expected that this volume is likely to diminish. Since 2016, 9,112 appeals have been received by the Commission, of which 6,267 appeals have been closed, leaving the current appeals on hand at 2,845.
In response to the second part of your question, I am informed by the Tax Appeals Commission that the current number of appeals on hand on 21 July 2021 of 2,845 is not likely to be cleared by the current complement of 5.5 Appeal Commissioners (including the Chairperson, and of which 2.5 are temporary fixed-term Commissioners) in a reasonable timeframe. However, with the appointment of Appeal Commissioners under the new tiered structure, it is expected that the backlog of appeals can be substantially addressed.
I am conscious that an effective, transparent and fair tax appeals system for taxpayers is an essential aspect of any tax system, and therefore it is important to ensure that the Commission is provided with the appropriate resources so that it may best address the caseload it faces.
315. Deputy Dara Calleary asked the Minister for Finance the provisions or options that exist for a sibling who was also primary carer in circumstances (details supplied); and if he will make a statement on the matter. [39814/21]
View answerI am advised by Revenue that, for the purposes of Capital Acquisitions Tax (“CAT”), the relationship between the person who provides a gift or inheritance (the disponer) and the person who receives it (the beneficiary) determines the lifetime tax-free threshold (“Group Threshold”) below which CAT does not arise. There are three separate Group thresholds based on the relationship of the beneficiary to the disponer. The Group A threshold (currently €335,000) applies, inter alia, where the beneficiary is a child of the disponer. The Group B threshold (currently €32,500) applies where the beneficiary is a brother, sister, nephew, niece or lineal ancestor or lineal descendant of the disponer. The Group C threshold (currently €16,250) applies in all other cases. Any prior gift or inheritance received by a beneficiary since 5 December 1991 from within the same Group Threshold is aggregated and added to the current benefit for the purposes of determining whether any tax is payable on a benefit. Where a person receives gifts or inheritances that are in excess of the relevant tax-free threshold, CAT at a rate of 33% applies on the excess benefit.
Each benefit received must be considered in the context of the relevant Group Threshold that applies at the time that the benefit is received and whether any reliefs or exemptions apply.
Siblings may gift or bequeath property to each other free from CAT where the value of the property does not exceed the Group B Threshold (€32,500), taking into account previous gifts and bequests to the beneficiary within that threshold.
There are no specific reliefs or exemptions available where the beneficiary of a gift or inheritance is a carer. However, where the inherited benefit is a residential property, the beneficiary may be able to avail of the dwelling house exemption. To qualify for this exemption, the inherited property must have been the disponer’s principal private residence at the date of their death. This requirement is relaxed in situations where the disponer had to leave the property before the date of death because of ill health; for example, to live in in a nursing home. In addition, the beneficiary must not have a beneficial interest in any other residential property. The beneficiary must also have lived in the property for 3 years prior to the date of the inheritance and must continue to live in the house for 6 years after that date. Where the exemption is available, the beneficiary will inherit the property free from CAT, irrespective of its value. Further information regarding the dwelling house exemption is available on Revenue’s website at www.revenue.ie/en/gains-gifts-and-inheritance/cat-reliefs/index.aspx.
Details of other reliefs and exemptions which may be available to the beneficiary can be found on Revenue’s website at www.revenue.ie/en/gains-gifts-and-inheritance/cat-reliefs/index.aspx and www.revenue.ie/en/gains-gifts-and-inheritance/cat-exemptions/index.aspx.
I understand that the beneficiary in this case inherited a house from her sibling. As an amount of CAT was paid, it appears that the beneficiary did not meet the qualifying conditions for the dwelling house exemption at the time of the inheritance. While the details supplied indicate that a further benefit of a cash sum has also been inherited by the same beneficiary, it is unclear who the disponer is in relation to the cash sum. If this benefit was bequeathed by the same disponer, or indeed another disponer within the Group B Threshold, then the beneficiary could be liable to CAT on that cash benefit. If the relationship of the beneficiary to the disponer is such that a different Group Threshold applies, then the beneficiary will need to determine their CAT liability in the usual way. As there is insufficient information to be definitive, the beneficiary may, if they wish to have certainty in this matter, provide full details of their case to Revenue or seek independent professional advice.
316. Deputy James O'Connor asked the Minister for Finance if public liability insurance premia for the reopening of pubs will be refunded if further lockdowns occur (details supplied); and if he will make a statement on the matter. [39827/21]
View answerAs the Deputy will be aware, 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. 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 their products. In addition, the Deputy will appreciate that it is difficult for me to comment on issues relating to situations that are hypothetical.
I can however comment on action that has been taken to date, and working to protect insurance policyholders during and after the COVID-19 crisis remains a priority issue for Government, and is therefore included within the Action Plan for Insurance Reform . Throughout the pandemic, Minister of State Fleming and I have consistently called on insurers to treat their customers honestly, fairly and professionally, in line with the Central Bank’s Consumer Protection Code. We have emphasised the importance of insurers supporting their customers during these difficult times by continuing to provide necessary reliefs, and responding to both the Government’s insurance reforms and the pandemic by lowering premiums.
Minister of State Fleming has had extensive engagement with insurers on these points, including a series of meetings in April at which he pressed the need for premium reductions in light of the new Personal Injuries Guidelines, which have significantly lowered award levels. He outlined that upon renewal, the Government expects premiums to reduce for all classes of insurance, including public liability insurance, and that insurers should now consider increasing their risk appetite to provide increased cover in new areas.
This engagement was positive, with insurers indicating that they will lower premiums in response to the Guidelines. It is Minister of State Fleming’s intention to meet with insurers again in the autumn to review progress in this regard. The issue of COVID-19 forbearance measures was included on the agenda for these meetings, and I understand that a number of firms indicated that they will also take account of COVID-19 restrictions when setting premiums.
I am pleased to note that most of the main insurers operating here have twice renewed their commitment to forbearance measures announced by several members of Insurance Ireland last year. These include a number of measures directed at businesses, such as maintenance of existing cover where premises are closed or unoccupied. I believe it is important that insurers now take a long term view towards supporting their customers, as we work to restart the economy and recover from the impact of the pandemic. Both Minister of State Fleming and I will remain proactive in engaging with the insurance industry on this matter, as well as working with colleagues to implement further key reforms, which I hope will go some way to improving the cost of insurance for all businesses, including those in the hospitality sector.
317. Deputy Róisín Shortall asked the Minister for Finance the steps he is taking to address the difficulties facing co-habiting couples who jointly own a property and who then must pay inheritance tax on their family home when one of them passes away; the right of co-habiting couples to apply to the Revenue Commissioners for a certificate to grant the same tax rights as married couples; and if he will make a statement on the matter. [39853/21]
View answerI am advised by Revenue that, for the purposes of Capital Acquisitions Tax (“CAT”), the relationship between the person who provides a gift or inheritance (“the disponer”) and the person who receives the gift or inheritance determines the lifetime tax-free threshold (“Group Threshold”) below which CAT does not arise. Any prior gift or inheritance received by a person since 5 December 1991 from within the same Group Threshold is aggregated for the purposes of determining whether any CAT is payable on a benefit. Where a person receives gifts or inheritances that are in excess of the relevant Group Threshold, CAT at a rate of 33% applies on the excess benefit. In the case of a cohabitant who is not related to the disponer, the relevant Group Threshold is the Group C threshold, which is currently €16,250.
Where a cohabitant inherits the family home from their deceased partner, they may be in a position to avail of the dwelling house exemption. To qualify for the exemption, the inherited house must have been the deceased cohabitant’s principal private residence at the date of their death. This requirement is relaxed in situations where the deceased person had to leave the house before the date of death because of ill health; for example, to live in in a nursing home. In addition, the inheriting cohabitant must not have a beneficial interest in another residential property. The inheriting cohabitant must also have lived in the house for 3 years prior to the date of the inheritance and must continue to live in the house for 6 years after that date.
In addition to the dwelling house exemption, certain transfers of property between qualified cohabitants within the meaning of Part 15 of the Civil Partnership and Certain Rights and Obligations of Cohabitants (CPCROC) Act 2010 are exempt from CAT. Part 15 provides for a redress scheme where court orders can be obtained in certain circumstances in relation to the transfer of property. This applies to “qualified cohabitants”, i.e. persons who have been in a committed and loving relationship with another person for a minimum period of 5 years (2 years where they are parents of one or more dependent children), whose relationship has ended due to death or separation and neither of whom was married to and living with another person in 4 of the 5 years immediately prior to the end of the relationship.
In relation to the Deputy’s reference to the right of cohabiting couples to apply to Revenue for a certificate granting them the same tax rights as married couples, it is important to note that differences in the tax treatment of the different categories of couples arise from the objective of dealing with different circumstances while also respecting the constitutional requirement to protect the institution of marriage. Cohabitants do not have the same legal rights and obligations as a married couple or couple in a civil partnership which is why they are not accorded similar tax treatment to couples who have a civil status that is recognised in law. Any change in the tax treatment of cohabiting couples can only be addressed in the broader context of future social and legal policy development in relation to such couples. As such, there is no statutory basis on which Revenue could issue the type of certificate the Deputy has referred to.
Further information on the taxation of cohabiting couples can be found on the Revenue website, available at www.revenue.ie/en/life-events-and-personal-circumstances/marital-status/cohabiting-couples/index.aspx.
318. Deputy Ged Nash asked the Minister for Finance the gross amount of tax relief provided for pension contributions in each of the past five years for which full figures are available in tabular form. [39861/21]
View answerI am advised by Revenue that the cost of relief of pension contributions for the years 2014-2018 (the latest year available) can be found in the ‘Cost of Tax Expenditures’ publication, which is available on the Revenue website at link: www.revenue.ie/en/corporate/documents/statistics/tax-expenditures/costs-tax-expenditures.pdf.
For the convenience of the Deputy, the following table sets out the relevant tax costs for the years 2014-2018:
|
Cost of tax Expenditure |
2018 €m |
2017 €m |
2016 €m |
2015 €m |
2014 €m |
|
Pension Contribution (Retirement Annuity and PRSA) |
241.3 |
229.3 |
221.3 |
216 |
214 |
|
Employees' Contributions To Approved Superannuation Schemes |
677.7 |
598.1 |
582.4 |
580.6 |
548.8 |
|
Employers' Contributions To Approved Superannuation Schemes |
173.2 |
159.8 |
158.4 |
147 |
138 |
319. Deputy Ged Nash asked the Minister for Finance the estimated cost to the Exchequer of removing stamp duty on credit cards; and if he will make a statement on the matter. [39862/21]
View answer362. Deputy Ged Nash asked the Minister for Finance the estimated yield which would accrue from a 1% increase in the rate of stamp duty on non-residential property; the estimated yield that would accrue if these rates were only subject to sales above €500,000 or €1,000,000, respectively in tabular form; and if he will make a statement on the matter. [39925/21]
View answer363. Deputy Ged Nash asked the Minister for Finance the estimated revenue which would be raised from increasing commercial stamp duty from 7.5% to 15%; and if he will make a statement on the matter. [39926/21]
View answerI propose to take Questions Nos. 319, 362 and 363 together.
Regarding Question No. 319 the yield from Stamp Duty on credit cards is published on the Revenue website at link: www.revenue.ie/en/corporate/information-about-revenue/statistics/receipts/receipts-stamp-duty.aspx. The cost of the abolition can be assumed to be in the region of the yield for the latest year.
Regarding Questions No. 362 and 363, the Revenue Ready Reckoner, which is available at link: www.revenue.ie/en/corporate/documents/statistics/ready-reckoner.pdf, shows on page 19, the estimated yield from changes to the rate of Stamp Duty on non-residential property. The proposed increases can be derived on a pro rata basis from information provided.
320. Deputy Ged Nash asked the Minister for Finance the anticipated savings to the Exchequer in 2022 from ending the employment and investment incentive scheme, the key employee engagement programme, the special assignee relief programme and the foreign earnings deduction in tabular form; and if he will make a statement on the matter. [39863/21]
View answer321. Deputy Ged Nash asked the Minister for Finance the anticipated savings to the Exchequer in 2022 from ending the rent-a-room relief; and if he will make a statement on the matter. [39864/21]
View answer445. Deputy Pearse Doherty asked the Minister for Finance the estimated revenue that would be generated in 2022 by ending the Special Assignee Relief Programme. [41354/21]
View answerI propose to take Questions Nos. 320, 321 and 445 together.
I am advised by Revenue that the estimated costs of the Rent a Room relief, the Employment and Investment Incentive (EII), the Special Assignee Relief Programme (SARP) and the Foreign Earnings Deduction (FED) in relation to 2018 (the latest year for which data are available) can be found in the ‘Cost of Tax Expenditures Report’ which is published on the Revenue website.
A summary table can also be found below.
These costs may be assumed to offer some indication of a broad nature of the savings to the Exchequer that might arise if the schemes/reliefs in question were ended for a given year. However, this does not take changes in taxpayer behaviour into account, or the secondary economic benefit provided by these schemes/reliefs.
Regarding the Key Employee Engagement Scheme (KEEP), I am advised by Revenue that the first year the scheme became available was 2018. Generally, a qualifying employee must hold any share options granted under the scheme for at least 12 months prior to exercise. Therefore, 2019 was the earliest date that individuals were likely to exercise their options to acquire shares in qualifying companies. An estimate of the cost for the 2019 tax year will be available later in the summer and will be available in the ‘Costs of Tax Expenditures Report’ .
|
Measure |
Cost |
|
Employment and Investment Incentive (EII) |
€14.5 million (2018) |
|
Special Assignee Relief Programme (SARP) |
€42.4 million (2018) |
|
Foreign Earnings Deduction (FED) |
€5.4 million (2018) |
|
Rent-A-Room Relief |
€19.7 million (2018) |
|
Key Employee Engagement Programme (KEEP) |
- |
322. Deputy Ged Nash asked the Minister for Finance the estimated saving to the Exchequer in 2022 from reducing the cap on BIK relief for electric cars from €50,000 to €35,000; and if he will make a statement on the matter. [39865/21]
View answerI am advised by Revenue that information regarding the purchase and or leasing of electric vehicles by employers, which are subsequently made available to their employees for private usage, along with the mileage used for both business and private usage is not provided on a tax return. In addition, employers are not required to provide a detailed breakdown of each of their employees’ BIK tax liabilities on their tax returns. As this information would be required to make the necessary calculation, it is not possible to estimate the saving to the Exchequer from the proposed change.
323. Deputy Ged Nash asked the Minister for Finance the estimated savings to the Exchequer from ending relief to conventional hybrids in 2022; and if he will make a statement on the matter. [39866/21]
View answerI can confirm to the Deputy that the Vehicle Registration Tax (VRT) relief provided to conventional hybrids (hybrid and plug-in hybrid vehicles) ended on 31 December 2020.
324. Deputy Ged Nash asked the Minister for Finance the estimated cost or saving to the Exchequer in 2022 from applying alternative tax regime for VRT that would see the number of VRT bands increase from 11 to 14 as set out by the Tax Strategy Group 2020; if he will provide a comparison with the existing VRT system in tabular form; and if he will make a statement on the matter. [39867/21]
View answerI can confirm to the Deputy that the number of Vehicle Registration Tax (VRT) bands that are applied to Category A vehicles was already increased from 11 to 20 in 2021.
The original table is presented below.
|
VRT Bands |
CO2 g/km |
VRT Rate (Petrol) |
VRT Rate (Diesel) [Effective 2019] |
|
A1 |
0-80 |
14% |
15% |
|
A2 |
81-100 |
15% |
16% |
|
A3 |
101-110 |
16% |
17% |
|
A4 |
111-120 |
17% |
18% |
|
B1 |
121-130 |
18% |
19% |
|
B2 |
131-140 |
19% |
20% |
|
C |
141-155 |
23% |
24% |
|
D |
156-170 |
27% |
28% |
|
E |
171-190 |
30% |
31% |
|
F |
191-225 |
34% |
35% |
|
G |
Over 225 |
36% |
37% |
The new VRT rates structure I legislated for in Finance Bill 2020 to replace the above is set out in tabular form below.
|
BAND |
FROM |
Rate |
|
1 |
0-50 |
7.00% |
|
2 |
51-80 |
9.00% |
|
3 |
81-85 |
9.75% |
|
4 |
86-90 |
10.50% |
|
5 |
91-95 |
11.25% |
|
6 |
96-100 |
12.00% |
|
7 |
101-105 |
12.75% |
|
8 |
106-110 |
13.50% |
|
9 |
111-115 |
14.25% |
|
10 |
116-120 |
15.00% |
|
11 |
121-125 |
15.75% |
|
12 |
126-130 |
16.50% |
|
13 |
131-135 |
17.25% |
|
14 |
136-140 |
18.00% |
|
15 |
141-145 |
19.50% |
|
16 |
146-150 |
21.00% |
|
17 |
151-155 |
23.50% |
|
18 |
156-170 |
26.00% |
|
19 |
171-190 |
31.00% |
|
20 |
Over 190 |
37.00% |
325. Deputy Ged Nash asked the Minister for Finance the revenue raised by the domicile levy for the past three years in tabular form; the estimated revenue that would be raised from doubling the domicile levy from €200,000 to €400,000 under the existing criteria; and if he will make a statement on the matter. [39868/21]
View answerThe Domicile Levy was introduced in the 2010 Finance Act and is payable on a self-assessment basis on or before 31 October in the year following the valuation date. For example, the due date in respect of 2019 was 31 October 2020. The valuation date is 31 December each year.
The table below sets out the number of persons who have filed Domicile Levy returns and the amounts collected for the years 2017, 2018 and 2019. Returns in respect of 2020 are not due until 31 October 2021.
|
Year |
No of Returns |
Amount Collected (€m) |
|
2017 |
12 |
€1.41 |
|
2018 |
8 |
€1.53 |
|
2019 |
10 |
€1.77 |
|
TOTAL |
30 |
€4.71 |
While the amount of the Domicile Levy is €200,000 per annum, any Irish income tax paid by the relevant person is allowed as a credit in calculating the actual amount due in any year. The obligation to file and pay can also change from year to year depending on the circumstances of the relevant person. Therefore, it is not possible to quantify what the impact of doubling the rate from €200,000 to €400,000 would be.
326. Deputy Ged Nash asked the Minister for Finance the estimated cost to the Exchequer in 2021 and 2022 of the e-worker tax relief; and if he will make a statement on the matter. [39869/21]
View answerWhere e-workers incur certain extra expenditure in the performance of their duties of employment remotely or from home, such as additional heating and electricity costs, there is a Revenue administrative practice in place that allows an employer to make payments up to €3.20 per day to such employees, subject to certain conditions, without deducting PAYE, PRSI, or USC. Revenue have confirmed that PAYE workers using their primary residence as a workplace during Covid-19 restrictions qualify as e-workers for the purposes of this practice. Where employers choose to pay in excess of €3.20 the additional amount is subject to deduction of PAYE, PRSI and USC.
Where an employer does not pay €3.20 per day to an e-worker, employees retain their statutory right to claim a deduction under section 114 of the Taxes Consolidation Act (TCA) 1997 in respect of actual vouched expenses incurred wholly, exclusively and necessarily in the performance of the duties of their employment. PAYE employees are entitled to claim costs such as additional light and heat in respect of the number of days spent working from home, apportioned on the basis of business and private use.
As I announced on Budget day, in addition to these existing measures, Revenue have agreed to allow broadband to qualify for this relief. This apportionment is based on the number of days the person spent working from home in year with 30% of the apportioned value accepted by Revenue as related to work in the home.
PAYE workers can claim e-working expenses by completing an Income Tax return at year end. Revenue advise that the simplest way for taxpayers to claim their e-working expenses and any other tax credit entitlements is by logging into the myAccount facility on the Revenue website.
Revenue have published detailed guidance on e-working arrangements in their Tax and Duty manual TDM 05-02-13 e-Working and Tax which may be viewed at the following link:
www.revenue.ie/en/tax-professionals/tdm/income-tax-capital-gains-tax-corporation-tax/part-05/05-02-13.pdf.
Finally, the national remote working strategy: Making Remote Work, commits the Tax Strategy Group to reviewing the current tax arrangements for remote working in respect of both employees and employers. The Tax Strategy Group will take account of the economic, financial and organisational implications arising from the experience of remote working during the pandemic, and assess the merits of further enhancements for consideration in the context of Budget 2022.
As of the end of May 2021, for the tax year 2020, provisional data from Revenue suggests that almost 70,000 claims have been submitted, amounting to approximately €9 million. This is unlikely to be the final figure for such claims, as taxpayers have up to four year to claim expenses. Therefore, at present, with the limited data available it is not possible to provide a costing for 2021 or 2022.
Revenue will report on the cost of e-worker tax relief for 2021, in due course, after the tax returns for the year are filed and processed.
