Thursday, 9 September 2021

Questions (187)

James Lawless

Question:

187. Deputy James Lawless asked the Minister for Finance his plans to increase tax relief on childcare; and if he will make a statement on the matter. [41942/21]

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Written answers (Question to Finance)

The Government acknowledges the continuing cost pressures on parents, particularly those with young children.

In recognition of these cost pressures, a number of support measures are already in place to ease the burden on working parents. These include various tax-exempted child-care related supports provided by the Minister for Children and Youth Affairs and measures such as the Working Family Payment provided by the Minister for Employment Affairs and Social Protection.

With regard to taxation measures, and separate to the above:

- The Accelerated Capital Allowances scheme for Childcare Services was introduced to encourage employers to develop childcare facilities onsite for their employees.

- Individuals who provide child-minding services in their own home may claim childcare services relief each year, provided that they do not receive more than €15,000 income per annum from the child-minding income.

- Furthermore, a Single Person Child Carer tax credit of €1,650 is available as well as an additional standard rate band of €4,000. This credit and band is payable to any single person with a child under 18 years of age or over 18 years of age if in full time education or permanently incapacitated. The primary claimant may relinquish this credit and increase in the rate band to a secondary claimant with whom the child resides for not less than 100 days in the year.

- I have no plans to introduce a specific income tax relief for parents to assist with childcare costs. As the Deputy will appreciate, I receive many requests for the introduction of new tax reliefs and the extension of existing ones. In considering these, I must be mindful of the public finances and the many demands on the Exchequer and I must have regard to budgetary constraints and the equitable treatment of all tax-payers. Tax reliefs, no matter how worthwhile in themselves, reduce the tax base and make general reform of the tax system that much more difficult.