Written Answers Nos. 87-105
87. Deputy Ged Nash asked the Minister for Finance if his Department has carried out a risk assessment regarding the winding down of the employment wage subsidy scheme and the potential impact on employment levels and the risk of corporate insolvencies; if his Department is considering a replacement scheme based on the principles of the successful German Kurzarbeit short-time work scheme; and if he will make a statement on the matter. [54316/21]
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). It provides a 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 cost to date (4th November) of the EWSS is almost €6.2 billion comprising of direct subsidy payments of €5.349 billion and PRSI forgone of €843 million to 51,600 employers in respect of over 681,000 employees.
It is important that, as the recovery gains further momentum, supports are further re-calibrated in the longer-term interests of businesses that are in receipt of those supports and in the interests of the wider body of taxpayers.
Government policy has been that there will be no cliff edge to the support, at the same time, it is necessary to unwind and phase out this temporary, emergency support measure.
As the Deputy will be aware, on Budget Day, I announced the extension of EWSS in a graduated form until 30 April 2022, which ensures there will be no sudden end to the EWSS and also provides clarity and certainty to business.
The following are the broad parameters of this extension:
- The current arrangements, including the enhanced rates of subsidy, will remain in place until November 30 2021;
- For December 1 2021 to February 28 2022, the original two-rate subsidy of €151.50 and €203 will apply;
- For March and April 2022, a single flat rate of €100 will apply and the reduced rate of Employers’ PRSI will be reinstated for these two months;
- Businesses availing of the EWSS on 31 December 2021 will continue to be supported until 30 April 2022. The scheme will close to new employers from 1 January 2022.
With the extension of EWSS to end April 2022, continued support will remain in place for six months after the lifting of most public health restrictions and two months after the planned cessation of the PUP. It also means that a wage subsidy scheme will have been in place for over two years. By signalling the changes to EWSS at this time, it ensures there will be no sudden end to the EWSS and also provides clarity and certainty to business.
In determining the appropriate approach to adopt with regard the recalibration of the EWSS and the ultimate phasing out of this temporary, emergency support measure, appropriate data were not available at sufficient breadth and depth across the various sectors of the economy to enable the type of risk assessment mentioned by the Deputy to be carried out.
At the same time, consideration was given to a range of factors. Such factors included the impact of the economic recovery on particular sectors, recent trends in EWSS statistics across different sectors, number of employers and employees supported by EWSS, the levels of employment and the trends in PUP, including the interaction and the flows between the EWSS and the PUP. In addition, Revenue operational experience and insights in relation to the scheme, duly interpreted and provided at a macro level, also informed the process.
More broadly, as outlined in the Budget 2022 Economic and Fiscal outlook – current data confirms that the Government’s policy response to the pandemic – essentially keeping workers close to the jobs market – has paved the way for a rapid rebound in the labour market. In addition, as part of the risk assessment published in Budget 2022, the risks related to SME indebtedness are taken into account.
All of the factors and elements mentioned helped to inform the Government’s decision to extend the EWSS in graduated form until 30 April 2022.
I am satisfied that the revised arrangements for EWSS strike a balance between helping those businesses which continue to need support, while recalibrating the scheme in light of the wider economic recovery.
In relation to a replacement scheme similar to the German Kurzarbeit short-time work scheme, I would note that the Department of Social Protection, in addition to the PUP and other jobseeker payments, currently provides a Short-Time, Work Support scheme to support employees. This is a form of Jobseeker's Benefit and is an income support payment for people who have been temporarily placed on a shorter working week by their employer.
It is widely acknowledged that the EWSS has been an extremely successful policy intervention during the pandemic and it played a central role in supporting businesses, encouraging employment and helping to maintain the link between employers and employees during this pandemic. I understand that, in relation to income supports and wage subsidy schemes, plans are being developed at official level to ensure that lessons learned from the crisis are captured for the longer term and that arrangements are put in place to be able to respond appropriately to any future large labour market shock.
88. Deputy Pádraig Mac Lochlainn asked the Minister for Finance the communication he has had or meetings he has held with retail banks and insurance companies with respect to contributions through levies or otherwise to a 100% redress scheme for homes affected by defective concrete blocks as a result of MICA and pyrite; and if he will make a statement on the matter. [54424/21]
View answerMy Department maintains contact with both the Banking Payments Federation Ireland (BPFI) and the insurance sector on a on going basis. While I have not met them specifically on the issue of contributions through levies or otherwise to a 100% redress scheme for homes affected by defective concrete blocks as a result of MICA and pyrite, I understand that the Minister for Housing, Local Government and Heritage will as soon as possible bring a proposal to Government in relation to the future of the defective concrete remediation scheme and the issues arising and it will then form a matter for Government consideration.
I very much appreciate the huge importance of this issue in the many communities that have been affected by the mica problem, and that it is giving rise to much stress and anxiety for the households directly impacted. The Government also fully understands these concerns. The Minister for Housing, Local Government and Heritage is now considering the report of the Working Group on the Defective Block scheme and this report and his proposals to improve the scheme, as well as the financing arrangements, will be fully considered by me and by all other Ministers when they are brought to Government in the near future.
89. Deputy Ged Nash asked the Minister for Finance if he will consider a short-term reduction in the rate of VAT charged on energy and certain other household utility bills to assist households with escalating heating and energy costs; and if he will make a statement on the matter. [54318/21]
View answerI am advised by Revenue that the VAT rating of goods and services is subject to the requirements of EU VAT law with which Irish VAT law must comply. The VAT Directive obliges each Member State to have a standard rate of VAT and also allows that a Member State may choose to have no more than two reduced rates of VAT which may be applied to certain goods and services i.e. any of those listed in Annex III of the Directive. In addition, within this rates structure, the Directive allows for historic VAT treatment to be maintained under certain conditions on certain goods and services not provided for in Annex III. Under this framework, Ireland has a standard VAT rate of 23% and two reduced rates of 13.5% and 9%. Also, Ireland has retained its historic application of one of the reduced rates of VAT, 13.5%, to a range of services (including the supply of fuel, gas, oil and electricity services) and, under the Directive, the rate applicable to such services cannot be reduced below 12%. There is no provision in the Directive that would allow a VAT exemption or a VAT rebate in respect of domestic energy supplies.
Of course the Government recognises the impact the increase in energy costs is having on households and in Budget 2022 a targeted package of social protection interventions was provided for through both the redistribution of carbon tax receipts and direct Exchequer funding.
90. Deputy Louise O'Reilly asked the Minister for Finance if there are barriers to reducing the VAT on non-alcoholic beer, stout and cider; and if he will make a statement on the matter. [54211/21]
View answerI am advised by Revenue that the VAT rating of goods and services is subject to the requirements of the EU VAT Directive with which Irish VAT law must comply. In accordance with the Value-Added Consolidation Act, 2010 the supply of non-alcoholic drinks is generally liable to tax at the standard rate, currently 23%.
The VAT Directive obliges each Member State to have a standard rate of VAT and also allows that a Member State may choose to have up to two reduced rates of VAT which may be applied to certain goods and services i.e. any of those listed in Annex III of the Directive, which includes non-alcoholic beverages. Ireland currently operates two lower rates of VAT, 13.5% and 9%. At present, Ireland applies the 9% VAT rate to certain non-alcoholic beverages such as tea, coffee and fruit juices where they are supplied in the course of catering. As the Deputy will be aware, this will revert to 13.5% from 1 September 2022 in line with the rest of the hospitality and tourism sector.
Any suggestion for extending the application of a reduced VAT rate further to non-alcoholic beverages would need to be considered carefully having regard to a range of factors including the impact on Exchequer revenues, and the practical concerns that it would be difficult to administer and would be likely to provide considerable scope for manipulation of the VAT system and opportunities for tax avoidance.
91. Deputy Holly Cairns asked the Minister for Finance if he will direct banks to provide customers with written banking statements on a monthly basis if requested by the customer. [54421/21]
View answerAll credit institutions in Ireland are independent commercial entities and decisions in relation to the provision of bank statements are made by the boards and management of individual banks.
I am advised by the Central Bank that Chapter 6 of the Consumer Protection Code 2012 ‘Post-sale Information Requirements’ sets out the requirements that regulated entities must follow when providing statements to consumers in relation to deposit, credit and investment accounts, including the consumers right to receive statements on paper.
Provision 6.2 of the Code sets out that in relation to these accounts, a regulated entity must inform a consumer that he or she may request the statements to be provided on paper and, if requested by the consumer, the regulated entity must provide these statements on paper to the consumer.
The Code provides that the regulated entity must provide the consumer with these statements at least annually.
The Deputy may wish to note that the Central Bank is currently conducting a review of the Code and a public consultation on the Central Bank’s proposals for amendments will take place as part of the review giving all stakeholders an opportunity to make submissions.
93. Deputy Michael Moynihan asked the Minister for Finance the number of businesses in counties Cork and Kerry, respectively that have registered under the business resumption support scheme in tabular form; and if he will make a statement on the matter. [54343/21]
View answer104. Deputy James Lawless asked the Minister for Finance the number of businesses in counties Kildare and Wicklow that have now registered under the business resumption support scheme; and if he will make a statement on the matter. [54339/21]
View answer107. Deputy Joe Flaherty asked the Minister for Finance the number of businesses in counties Longford and Westmeath that have now registered under the business resumption support scheme in tabular form; and if he will make a statement on the matter. [54348/21]
View answer116. Deputy John McGuinness asked the Minister for Finance the number of businesses in counties Carlow, Kilkenny, Wexford and Waterford that have now registered under the business resumption support scheme in tabular form; and if he will make a statement on the matter. [54337/21]
View answer118. Deputy John Lahart asked the Minister for Finance the number of businesses in Dublin city and county that have now registered under the business resumption support scheme; and if he will make a statement on the matter. [54352/21]
View answer131. Deputy Dara Calleary asked the Minister for Finance the number of businesses in counties Mayo, Roscommon, Sligo, Leitrim and Donegal that have now registered under the business resumption support scheme in tabular form; and if he will make a statement on the matter. [54335/21]
View answer136. Deputy Barry Cowen asked the Minister for Finance the number of businesses counties Offaly and Laois, respectively that have registered under the business resumption support scheme in tabular form; and if he will make a statement on the matter. [54373/21]
View answer138. Deputy Cathal Crowe asked the Minister for Finance the number of businesses in counties Clare and Galway that have now registered under the business resumption support scheme in tabular form; and if he will make a statement on the matter. [54356/21]
View answer154. Deputy Niamh Smyth asked the Minister for Finance the number of businesses in counties Cavan, Monaghan, Meath and Louth, respectively that have registered under the business resumption support scheme in tabular form; and if he will make a statement on the matter. [54354/21]
View answer156. Deputy Jackie Cahill asked the Minister for Finance the number of businesses in counties Tipperary and Limerick, respectively that have registered under the business resumption support scheme in tabular form; and if he will make a statement on the matter. [54371/21]
View answerI propose to take Questions Nos. 93, 104, 107, 116, 118, 131, 136, 138, 154 and 156 together.
The Business Resumption Support Scheme (BRSS) is a support for businesses impacted by COVID-19. I am advised by Revenue that eligible businesses can register for the BRSS via the e-Registration facility on the Revenue On-line System (ROS). Once registered, eligible businesses can make a claim at any time up to 30 November 2021.
Registration for BRSS opened on 6 September 2021. I am advised by Revenue that so far, 1,415 businesses with 1,500 trades have availed of BRSS and claims of €4.9 million have been paid under the Scheme.
The following table sets out the numbers of businesses applying for BRSS, broken down by county.
|
County |
Number of Businesses |
|
Carlow |
10 |
|
Cavan |
40 |
|
Clare |
30 |
|
Cork |
155 |
|
Donegal |
40 |
|
Dublin |
430 |
|
Galway |
90 |
|
Kerry |
70 |
|
Kildare |
40 |
|
Kilkenny |
30 |
|
Laois |
15 |
|
Leitrim |
10 |
|
Limerick |
55 |
|
Longford |
15 |
|
Louth |
40 |
|
Mayo |
50 |
|
Meath |
55 |
|
Monaghan |
25 |
|
Offaly |
15 |
|
Roscommon |
25 |
|
Sligo |
15 |
|
Tipperary |
55 |
|
Waterford |
30 |
|
Westmeath |
25 |
|
Wexford |
30 |
|
Wicklow |
20 |
Revenue publishes detailed statistics each week on the operation of COVID-19 support schemes, these statistics release include information on the BRSS. These statistics are available on Revenue.ie and updates to the above table will be available in the coming weeks.
94. Deputy Matt Carthy asked the Minister for Finance if he will ensure that recommendations that arise from the proposed review into extending section 664A of the Taxes Consolidation Act 1997 to include agricultural contractors for the purpose of providing them similar status as farmers regarding the carbon tax on green diesel are implemented prior to the relevant increase in carbon tax taking effect in May 2022. [54321/21]
View answerThe present position is that agricultural contractors are not entitled to avail of relief from increases in the carbon tax on farm diesel under section 664A of the Taxes Consolidation Act 1997. This is because farming, which is defined in section 654 of the Taxes Consolidation Act, requires that the occupation of farmland. Agricultural contracting does not involve the occupation of farmland. The measure is specifically targeted at the farming sector to address the particular problems faced by family farms.
My officials met with contractors' representatives in December 2019 and advised that my Department was intending to schedule a review of the scheme (and related aspects) in the context of a wider report on agri-tax reliefs and the Government's Climate policy.
The onset of the Covid-19 pandemic in the intervening period caused the review to be deferred and it has yet to take place. In the meantime, the status quo has remained in relation to the application and scope of section 664A. My Department is hopeful that the way will be clear for the promised review to be carried out, most likely in the first half of 2022.
It should also be noted that, currently, those who incur expenses in relation to farm diesel in the course of their trade of agricultural contracting may claim an income tax or corporation tax deduction for these expenses, including any carbon tax charged in respect of the diesel.
Finally, and as the Deputy will appreciate, decisions regarding taxation measures are made in the context of the annual Budget and Finance Bill process at the appropriate time, having regard to the sound management of the public finances and my Department's Tax Expenditure Guidelines. Furthermore, I must also have regard to ensuring that any tax measures are consistent with the need to meet our Climate Action Plan targets.
95. Deputy Richard Boyd Barrett asked the Minister for Finance if his attention has been drawn to the fact that film producer companies in receipt of section 481 tax relief (details supplied) are regularly and on a routine basis stating to the Workplace Relations Commission and Labour Court that they have no employment relationship with film workers who have worked on section 481 funded productions in cases in which those workers take a case to those bodies; and if he will make a statement on the matter. [54401/21]
View answerSection 481 TCA 1997 provides a 32% payable credit for eligible expenditure on film production in Ireland. The scheme is intended to act as a stimulus to the creation of an indigenous film industry in the State, creating quality employment opportunities and supporting the expression of the Irish culture.
The audiovisual sector has largely continued to function through the most challenging period of the pandemic and to provide quality employment at a time when so many other elements of the culture sector were so severely impacted. The protocols put in place by the sector have meant that workers have been in high demand.
It is the expectation that, in the provision of such opportunities, there will be compliance with all applicable employment obligations including legislative obligations and policies and procedures to ensure dignity at work. To grow the industry in Ireland, we want to see quality and sustained employment and training opportunities in the sector. This is reflected in the undertaking of quality employment which is required to be signed as part of the application process for Section 481.
There has been good progress over the past year in relation to negotiations between employer and worker representatives in the sector. For example, from January 2021 a modernised Crew Agreement was introduced which promotes good practice, regularises evolving work practices and provides for an industry pension scheme operating under the Construction Workers Pension Scheme (CWPS). A monitoring structure to oversee the operation of the agreement is included, as is a commitment to developing the first Work/Life Balance policy for the film and television industry. The Agreement acts as a framework for the industry covering all grades except film construction.
I have been made aware that a proposed Construction Crew Agreement has been rejected earlier this week. I am informed however, that the Unions will be writing to Screen Skills Ireland (the skills development unit within Screen Ireland) to discuss the next steps towards reaching an agreement, and my officials will continue to monitor progress in this regard.
In relation to any specific workplace disputes, the Workplace Relations Commission (WRC) and the Labour Court are the organs of the State tasked with the resolution of disputes relating to workplace matters and employment rights and it is appropriate that any relevant claims should be referred to these bodies for adjudication. As a result I am unable to comment on such matters.
96. Deputy Denis Naughten asked the Minister for Finance the plans he has to amend the disabled drivers and disabled passengers scheme; and if he will make a statement on the matter. [54324/21]
View answer139. Deputy Denis Naughten asked the Minister for Finance when a review of the primary medical certificate scheme will be concluded; and if he will make a statement on the matter. [53576/21]
View answer245. Deputy Denis Naughten asked the Minister for Finance when a review of the primary medical certificate scheme will be concluded; and if he will make a statement on the matter. [54219/21]
View answerI propose to take Questions Nos. 96, 139 and 245 together.
The 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 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, and satisfy at least one of the following medical criteria, in order to obtain a Primary Medical Certificate:
- be wholly or almost wholly without the use of both legs;
- be wholly without the use of one leg and almost wholly without the use of the other leg such that the applicant is severely restricted as to movement of the lower limbs;
- be without both hands or without both arms;
- be without one or both legs;
- be wholly or almost wholly without the use of both hands or arms and wholly or almost wholly without the use of one leg;
- have the medical condition of dwarfism and have serious difficulties of movement of the lower limbs.
The current medical criteria medical criteria were included in the Finance Act 2020, by way of amendment to Section 92 of the Finance Act 1989. This amendment arises from legal advice in light of the June 2020 Supreme Court judgement that the medical criteria in secondary legislation 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 (primary legislation).
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 provided an undertaking to review the scheme, including a broader review of mobility supports for persons with a disability. My officials have been carrying out preliminary work, including an examination of the main issues which will frame the scope of the review and engaging with other Departments and agencies.
Separately, I have reached out to the Minister for Children, Equality, Disability, Integration and Youth, in the context of a review that was commenced in March 2020 under the auspices of the National Disability Inclusion Strategy, to examine transport supports encompassing all Government funded transport and mobility schemes for people with disabilities. Its work was interrupted by the COVID-19 pandemic. Minister O’Gorman has confirmed that he has asked his officials to reconvene the working group established to carry out that review at the earliest opportunity and we are both agreed that this is the most appropriate forum for the review. With this in mind, my officials will work closely with officials from the Department of Children, Equality, Disability, Integration and Youth to progress this review, and on foot of that will bring forward proposals for consideration.
97. Deputy Alan Dillon asked the Minister for Finance if consideration will be given to extending the highest 5% rate of the regional film development uplift for claims made after 31 December 2021; if there are similar or alternative proposals to encourage film production in regional areas as part of the film tax credit section 481; if additional supports can be considered to help expand and develop the increased level of film production taking place in County Mayo; and if he will make a statement on the matter. [54418/21]
View answerSection 481 provides relief in the form of a corporation tax credit related to the cost of production of certain films. The scheme is intended to act as a stimulus to the creation of an indigenous film industry in the State, creating quality employment opportunities and supporting the expression of the Irish culture.
Finance Act 2018 introduced a short-term, tapered regional uplift for productions being made in areas designated under the State aid regional guidelines. The purpose of the regional uplift is to support the development of new, local pools of talent in areas outside the current main production hubs, to support the geographic spread of the audio-visual sector.
The uplift originally provided an increased level of credit for four years, with 5% available in years 1 and 2 (2019 and 2020), 3% available in year 3 (2021), 2% available in year 4 (2022). However in recognition of the detrimental impact the COVID-19 crisis had on the audio-visual sector Finance Act 2020 amended the regional uplift to provide for an additional 5% year in 2021, in effect to replace the incentive year lost as a result of the COVID-related public health measures. The tapered withdrawal of the uplift then restarts, reducing to 3% in 2022, 2% in 2023, and Nil thereafter.
There are currently no plans to extend the availability of the regional uplift at the rate of 5%. In addition, there are currently no additional alternative proposals for regional specific changes being considered in the context of Section 481. However I would note that the main film tax credit will remain available to qualifying productions in all areas of the country following the winding-down of the uplift.
98. Deputy Barry Cowen asked the Minister for Finance the number of persons in each supported by the employment wage subsidy scheme and its predecessor since the start of the pandemic; the value of the support in each county over that time in tabular form; and if he will make a statement on the matter. [54374/21]
View answerThe Temporary Wage Subsidy Scheme (TWSS) was introduced in 26 March 2020 as an emergency income support for eligible employees where the employer’s business activities were negatively impacted by the COVID-19 pandemic. Over 66,600 employers received a subsidy under the TWSS with payments of €2.8 billion paid out to a total of 664,500 workers. The scheme operated until 31 August 2020 and was replaced by the Employment Wage Subsidy Scheme (EWSS) from 1 September 2020.
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.
The cost to date (4th November) of the EWSS alone is almost €6.2 billion, comprising of direct subsidy payments of €5.349 billion and PRSI forgone of €843 million to 51,600 employers in respect of over 681,000 employees.
To answer the Deputy's specific question for an analysis by county, the table below provides an indication of the number of employees supported by the TWSS and the EWSS, and the amounts of direct subsidy provided, for both schemes. As such amounts relating to Employers’ PRSI foregone are not included in the table below, nor are such data readily available.
It may be noted that the totals in this table do not fully reconcile to the overall aggregate totals for the amount of subsidy paid out under the schemes and the number of employees supported by the schemes. Revenue are actively reviewing the accuracy and the validity of claims which may result in some changes. Further, in some cases Revenue cannot accurately allocate a location for some employees based on the present data. Nonetheless, the data in the table will provide the Deputy with indicative estimates of the number of employees supported and the amount of direct subsidy support provided on a county basis, based on the best information available at this time.
|
TWSS |
EWSS |
|||
|
County |
Employees |
Subsidy (€m) |
Employees |
Subsidy (€m) |
|
Carlow |
8,600 |
€38 |
7,700 |
€58 |
|
Cavan |
10,000 |
€41 |
8,300 |
€63 |
|
Clare |
12,600 |
€56 |
16,000 |
€132 |
|
Cork |
61,800 |
€267 |
59,400 |
€458 |
|
Donegal |
15,900 |
€62 |
19,800 |
€147 |
|
Dublin |
266,900 |
€1,233 |
246,000 |
€2,168 |
|
Galway |
37,200 |
€158 |
36,400 |
€289 |
|
Kerry |
18,600 |
€76 |
23,600 |
€189 |
|
Kildare |
28,600 |
€120 |
26,800 |
€237 |
|
Kilkenny |
10,000 |
€44 |
8,900 |
€68 |
|
Laois |
6,600 |
€29 |
5,800 |
€47 |
|
Leitrim |
2,700 |
€12 |
2,600 |
€16 |
|
Limerick |
25,200 |
€112 |
23,000 |
€189 |
|
Longford |
5,300 |
€23 |
4,500 |
€32 |
|
Louth |
16,600 |
€76 |
15,300 |
€137 |
|
Mayo |
15,300 |
€62 |
16,000 |
€121 |
|
Meath |
21,200 |
€88 |
21,700 |
€163 |
|
Monaghan |
9,300 |
€44 |
7,700 |
€58 |
|
Offaly |
7,300 |
€29 |
5,800 |
€42 |
|
Roscommon |
5,300 |
€21 |
5,100 |
€37 |
|
Sligo |
6,600 |
€29 |
7,000 |
€53 |
|
Tipperary |
13,900 |
€59 |
13,400 |
€105 |
|
Waterford |
14,600 |
€59 |
13,400 |
€100 |
|
Westmeath |
10,600 |
€50 |
10,200 |
€79 |
|
Wexford |
18,600 |
€79 |
20,400 |
€153 |
|
Wicklow |
14,600 |
€65 |
15,300 |
€121 |
|
Totals |
663,900 |
€2,932 |
640,100 |
€5,262 |
100. Deputy Brendan Smith asked the Minister for Finance if he has had recent discussions with banks (details supplied) in relation to the protection of employment due to their respective decisions to exit the Irish market and close branches throughout the country; and if he will make a statement on the matter. [54334/21]
View answerThe withdrawal of Ulster Bank from the market and the decision by Bank of Ireland to close 88 branches in the Republic of Ireland are regrettable, particularly for their customers and staff and they represent unfavourable developments for the Irish banking market. However, decisions in this regard are the sole responsibility of the board and management of the banks, which must be run on an independent and commercial basis.
In relation to Bank of Ireland, my officials and I have ongoing engagement with each of the banks in which the State has a shareholding. This engagement has been in place since the State first invested in the banks and it includes regular meetings where a wide range of topics are discussed. In relation to branch closures, Bank of Ireland has said that it will be working closely with all colleagues at these branches and will be setting out a range of options which include relocating to a different branch, moving to a new role in the bank, or voluntary redundancy for those who choose it.
In relation to Ulster Bank, on 22 September, I met with Alison Rose, CEO of NatWest, Sir Howard Davies, Chair of NatWest, Jane Howard, the CEO of Ulster Bank, and Martin Murphy, the Chair of Ulster Bank. At this meeting, they updated me on the progress of the withdrawal and I emphasised the importance of an orderly withdrawal.
In this regard, I welcome the agreements which have been put in place by Ulster Bank since its announcement:
- On 11 June, Ulster Bank announced that a new Colleague Agreement has been reached with the Financial Services Union subject to a ballot of its members.
- On 28 June, Ulster Bank agreed a legally binding agreement with AIB in respect of a €4.2bn portfolio of performing loan products. I note that Ulster Bank expects c. 280 staff wholly or mainly assigned to this loan book to transfer also.
- On 23 July, Ulster Bank reached a non-binding agreement with PTSB for the proposed sale of €7.6bn performing loans, Ulster Bank’s Lombard Asset Finance business, and 25 Ulster Bank branch locations. I note that if this potential transaction is delivered, it is expected that between 400 and 500 Ulster Bank employees will transfer to PTSB.
Whilst the management of staff affairs, including staffing levels, is entirely a matter for Ulster Bank and for whoever acquires its business, I would expect all entities to be very sensitive in relation to the needs and rights of staff and to fully comply with all statutory requirements. In addition, I would expect engagement with staff representative bodies as appropriate.
101. Deputy Kieran O'Donnell asked the Minister for Finance the breakdown of received and granted applications for both residential and commercial properties under the living city initiative for Limerick city; his future plans to review and expand the scheme; and if he will make a statement on the matter. [54420/21]
View answerAs I advised the Deputy in my response to his previous recent question on the number of Living City Initiative applications for Limerick, according to Revenue, applications are made to the relevant Local Authority in respect of the owner-occupier and rented residential elements of the scheme; applications to the Local Authority are not required to be made under the commercial element of the scheme.
My previous response included a breakdown of the number of valid applications received by Limerick City and County Council in the years 2016 (being the first year for which statistics are available) to 2021. This information was based on the most recent information received by Revenue. For the Deputy's information, I include that information below:
|
Year |
Applications received |
|
2016 |
<10* |
|
2017 |
<10 |
|
2018 |
16 |
|
2019 |
19 |
|
2020 |
33 |
|
2021 |
33 |
*Fewer than 10 claimants, the exact number is not shown to protect taxpayer confidentiality
Further statistical information on LCI, including the maximum tax cost and the number of claimants under the LCI, is available on the Revenue website at:
www.revenue.ie/en/corporate/documents/statistics/tax-expenditures/property-reliefs.pdf.
The Living City Initiative (LCI) was established in 2015 and is specifically aimed at the regeneration of the historic inner cities of Dublin, Cork, Galway, Kilkenny, Limerick and Waterford. The scheme provides income or corporation tax relief for qualifying expenditure incurred in refurbishing/converting of qualifying buildings, including for residential purposes, which are located within pre-determined 'Special Regeneration Areas' (SRAs).
As the Deputy will be aware, the scheme was reviewed in 2016. This review resulted in a series of significant changes in Finance Act 2016 that came into effect from January 2017. The Initiative was further considered in 2019 and Finance Act 2019 provided for an extension of the scheme until 31 December 2022. As the scheme sunsets in 2022, it will fall to be considered in the context and Budget 2023 and Finance Bill 2022.
The Living City Initiative is a very specific tax incentive, established in compliance with the Department of Finance’s Tax expenditure Guidelines, with the aim of encouraging businesses and home-owners back to the centre of Irish cities in order to preserve historic buildings in special regeneration areas. I do not believe that it is a suitable vehicle for broader application beyond its original policy goal.
A large scale expansion of Living City would amount to s.23 type relief. These types of reliefs were ended well over a decade ago. It would also mean that Living City would, in effect, become a different scheme, one which would need an ex-ante cost benefit analysis where the cost implications are so substantial. In any event, the proposal would have the potential for greatly increased Exchequer costs and would raise State Aid concerns.
There are many competing priorities which must be considered when deciding which policy measures to introduce. Taxation is only one of the policy levers available to the Government. In line with the Tax Expenditure Guidelines, consideration of whether a tax measure is the most appropriate policy tool for a given purpose would be required. The presumption should be that non-tax measures should be considered before the use of a tax–based measure.
Finally, Ireland’s past experience with tax incentives in this sectors strongly suggests the need for a cautionary stance.
102. Deputy Gino Kenny asked the Minister for Finance if he will extend the bike to work scheme to those who are self-employed; and if he will make a statement on the matter. [54405/21]
View answerSection 118(5G) of the Taxes Consolidation Act 1997 (TCA 1997) provides for the Cycle-to-Work scheme. This scheme provides an exemption from benefit-in-kind (BIK) where an employer purchases a bicycle and associated safety equipment for an employee.
Under section 118B TCA 1997 an employer and employee may also enter into a salary sacrifice arrangement under which the employee agrees to sacrifice part of his or her salary, in exchange for a bicycle and related safety equipment.
Where a bicycle or safety equipment is purchased under the Cycle-to-Work scheme or through a salary sacrifice arrangement certain conditions must be met, for example:
- The exemption applies to the first €1,250 of expenditure incurred by the employer in obtaining a bicycle and related safety equipment. This exemption limit is increased to €1,500 for pedelecs or ebikes and related safety equipment. Employers may incur costs in excess of these limits, but any such excess will not qualify for the exemption and will be liable to tax. A salary sacrifice arrangement is subject to the same monetary limits.
- The bicycle and related safety equipment must be new and must be purchased by the employer.
- The bicycle and related safety equipment must be used by the employee or director mainly for the whole or part of their journey to or from work.
- An employee or director can only avail of the Cycle-to-Work scheme once in any 4 year period. A salary sacrifice arrangement is subject to the same time limits and any salary sacrifice arrangement entered into must be completed within a 12 month period.
The Cycle-to-Work scheme is only applicable where the bicycle and safety equipment is provided by an employer to either a director or someone in its employment. Thus, where an employer-employee relationship does not exist, for example, in the case of self-employed individuals, students, retired individuals, job seekers or those in unpaid work, such individuals can’t qualify for the scheme. Likewise, salary sacrifice arrangements may only be entered into between an employer and a director or employee.
Further guidance can be found on Revenue’s website.
While the scheme is kept under review by my officials, I have no plans at present for its expansion.
103. Deputy Richard Boyd Barrett asked the Minister for Finance if he has considered ending the Special Assignee Relief Programme in the interests of just taxation; and if he will make a statement on the matter. [54399/21]
View answer144. Deputy Catherine Connolly asked the Minister for Finance his plans to phase out the Special Assignee Relief Programme; and if he will make a statement on the matter. [54378/21]
View answerI propose to take Questions Nos. 103 and 144 together.
The Finance Act 2012 introduced section 825C to the Taxes Consolidation Act, 1997. This section, as amended, provides Income Tax relief for certain individuals assigned during any of the tax years 2012 to 2022 to work in the State. The relief is commonly known as SARP (Special Assignee Relief Programme).
SARP provides for relief from Income Tax on 30% of income over €75,000, subject to an upper income threshold, where applicable. There is no exemption from USC. PRSI is payable where the individual is not liable to social insurance contributions in his or her home country. School fees of up to €5,000 per annum and expenses incurred on one trip home per year, where they are paid for by the employer, are not subject to Income Tax, USC or PRSI.
The scheme is an incentive designed to help reduce the cost to employers of assigning skilled individuals in their companies from abroad, to take up positions in the Irish-based operations, thereby facilitating skills transfer and the creation of jobs and the development and expansion of businesses in Ireland. The most recent data on SARP can be found in the 2019 Revenue report, available at www.revenue.ie/en/corporate/documents/research/sarp-report-2019.pdf.
According to that report, the numbers of persons who availed of SARP in the period 2012 to 2019 (the most recent year for which data are available) are as follows:
|
Year |
Applications received |
|
2016 |
<10* |
|
2017 |
<10 |
|
2018 |
16 |
|
2019 |
19 |
|
2020 |
33 |
|
2021 |
33 |
|
2012 |
2013 |
2014 |
2015 |
2016 |
2017 |
2018 |
2019 |
|
11 |
121 |
302 |
586 |
793 |
1,084 |
1,481 |
1,574 |
The cost of the scheme for those years is as follows (€m):
|
2012 |
2013 |
2014 |
2015 |
2016 |
2017 |
2018 |
2019 |
|
0.1 |
1.9 |
5.9 |
9.5 |
18.1 |
28.1 |
42.4 |
38.2 |
The 2019 Revenue report indicates a significant reversal in the overall cost of the scheme as compared with 2018. This is attributable at least in part, to my decision to introduce in Finance Act 2018 a salary cap of €1m on the amount of a person's income that can benefit from the scheme. The change applied from 1 January 2019 for new entrants and from 1 January 2020 for existing recipients.
Furthermore, the aggregate number of jobs that were reported as created and retained as a result of the scheme has increased since 2018. There were 379 additional employees compared with 236 in 2018 and the number of employees retained was 483, compared with 348 in 2018. This combined total of 862 SARP-related jobs in 2019 represents a cost of €44,000 per job created or retained, a decrease in cost per job compared with 2018, when there were 584 SARP supported jobs at an average cost of €73,000 each. This represents a decrease in cost of over 39%.
In terms of the continuation of the scheme, it is important for the Deputies to note that Ireland’s enterprise policy is based on export-led growth and Foreign Direct Investment has been, and continues to be, an integral part of Ireland’s economic development. The existence of an incentive like SARP is an acknowledgement that we are competing on a global basis for highly skilled and mobile executives. The competition for this talent is intense, particularly for the types of skills required to facilitate the development and expansion of businesses in Ireland.
The existence of similar (and indeed more attractive) special assignee type tax reliefs in a number of competitor jurisdictions creates a competitive disparity that would not be addressed if not for the continued existence of SARP.
Aside from enhancing our international competitiveness, the benefits of SARP, as detailed in the 2019 Indecon report on the measure, available on my Department's website, include:
- Increased employment and retention of staff within SARP companies;
- Associated additional investment in the economy;
- Additional Corporation Tax receipts;
- Additional PAYE receipts; and
- R&D spillover activity.
In line with my Department's Tax Expenditure Guidelines, SARP will be reviewed before its sunset date of 31 December 2022. In the meantime, there are no plans to phase out the relief as suggested by Deputy Connolly.
105. Deputy Bernard J. Durkan asked the Minister for Finance the extent to which he sees the possibility of inflation causing complications in the course of recovery from the financial effects of Covid-19; if this issue can be addressed at national or EU level in order to achieve the most effective and least painful methods of dealing with the issue; and if he will make a statement on the matter. [54350/21]
View answerThe flash estimate for HICP inflation in October is 5.1 per cent, which would be the highest rate since 2003. The emergence of inflationary pressures in recent months is not unique to Ireland however, with the euro area flash estimate reaching 4.1 per cent.
The recent increase in inflation is partly explained by temporary factors, which are expected to fade over time, including ‘base effects’ associated with the ‘normalisation’ of oil prices following their collapse last spring and the imbalance between supply and demand that emerged following re-opening. This has been compounded by global supply chain disruptions, including transport bottlenecks, input shortages (e.g. semi-conductors) and labour supply shortages in some sectors.
Looking ahead, the most likely scenario is that inflation will moderate over the course of next year as temporary factors fade, demand stabilises and supply catches up. At the time of the Budget, inflation of around 2¼ per cent was projected for this year and next. However, the recent spike in international wholesale energy prices means there could already be some upside to these projections. A scenario analysis outlining the macroeconomic implications of higher than expected inflation is set out in the Economic and Fiscal Outlook published with the Budget.
Consistent with this outlook, the Commission and the ECB are confident that elevated inflation is linked to temporary factors, supply-side constraints and the recovery in demand as our economies reopen. That said, energy prices can entail wide-ranging consequences for inflation including for businesses and families. In recognition of the social impacts, many Member States have introduced targeted measures to protect vulnerable households from energy poverty. In framing Budget 2022, I was conscious of these cost of living pressures, and therefore announced a range of measures including targeted social welfare initiatives.
Additionally, the European Commission has issued a Communication on Tackling Rising Energy Prices, and the matter was discussed at various Council configurations. In short, my fellow Finance Ministers and I all agree that this is an important issue and that we need to continue monitoring inflation and energy price developments and the potential implications of these for our economies.
