Written Answers Nos. 309-327
309. Deputy Thomas Pringle asked the Minister for Finance if all sections of all Acts passed in the past ten years have been commenced; the number of sections that are outstanding; the number of Acts that have review periods; if the reviews have taken place; and if he will make a statement on the matter. [63381/22]
View answerIt has not been possible in the time available to compile an updated list of the information sought in the Deputy's PQ. My officials will revert in writing to the Deputy when this is ready. Please note however that where the Oireachtas has chosen to provide a discretion to a Minister to commence legislation the Oireachtas has decided it should not commence until the Minister chooses to exercise that discretion in favour of commencement. The non-commencement to date of any legislative provisions is a matter of discretion for the relevant Minister and should not be characterised as a delay.
310. Deputy Jackie Cahill asked the Minister for Finance the reason that workers who received the EWSS and TWSS are now being taxed for this payment (details supplied); his views on whether it is fair to place a tax burden on them now for their work; if this will result in a higher tax bill than if their employer had not availed of these payments and paid their wages as usual; and if he will make a statement on the matter. [63447/22]
View answerThe Temporary Wage Subsidy (TWSS) was in place between 26 March and 31 August 2020 and was introduced as an emergency income support for employees of vulnerable firms whose businesses had been negatively impacted by COVID restrictions and whose turnover had reduced by at least 25% during Q2 2020. The support was paid via the employer so as to maintain employment links between the employee and employer insofar as was possible.
Payments made under the TWSS were regarded as income supports and shared the characteristics of income. Other income earners in receipt of comparable “normal wages” were taxable on those wages. In the interest of equity, therefore, payments under the TWSS were subject to income tax and Universal Social Charge (USC).
While income tax and USC on most income is deducted in real-time as and when the person is paid, the TWSS payments were not taxed in real-time and were instead liable to income tax and USC at the end of 2020. Tax was not collected while the scheme was in operation in order to maximise the amount of financial support provided to recipients at a time when it was considered most needed.
The Government was consistent as regards the TWSS’s liability to tax from the outset of the payment. Indeed, Revenue advised my predecessor that it clarified the tax treatment of the TWSS at employee level in the guidance material that it published on its website from the commencement of the scheme. Furthermore, Revenue actively engaged in facilitating webinars with the Employer Bodies, Accountancy Firms and Tax Practitioners to explain and clarify any issues for employers as regards the TWSS.
Revenue made a Preliminary End of Year Statement available to all employees from 15 January 2021, including those who were in receipt of the TWSS. This Statement, which is based on information available on Revenue records, includes information relating to an employee’s income received, including pensions and income from the Department of Social Protection, as well as their tax credit entitlements.
For the tax year 2020, the Statement also included information on the amounts of TWSS payments, if any, reported by the individual’s employer and received by each employee. In addition, it provided employees with a preliminary calculation of the income tax and USC position for 2020 and indicated whether their tax position was balanced, underpaid or overpaid for the year.
Upon viewing the Preliminary End of Year Statement through myAccount, which is Revenue’s secure online facility for individual taxpayer services, employees had an opportunity to complete their income tax return for 2020, while declaring any additional income and claiming any additional tax credits due, for example qualifying health expenses, to arrive at their final liability for 2020.
When a liability was finalised, individuals could opt to fully or partially pay any income tax and USC liability through the Payments/Repayments facility in myAccount. Where individuals did not opt to fully or partially pay, the outstanding liability was to be collected by reducing their tax credits over 4 years, interest free. The reduction of tax credits started in January 2022.
While the income tax and USC liabilities arising from TWSS payments were those of the employee, Revenue also facilitated employers who wished to pay some or all of the employees' 2020 TWSS-related tax and USC liabilities. Where the employer opted to pay, Revenue concessionally did not apply benefit-in-kind rules to these payments. Initially, this facility was limited to payments made by employers on behalf of their employees up to end June 2021 however the concession was extended to run until the end of September 2021.
As regards the Deputy’s query as to whether the arrangements would result in a higher tax bill for the employee as compared with circumstances where their employer had not availed of TWSS, I am advised by Revenue that a higher tax bill would not arise in cases involving TWSS. In fact, those in receipt of TWSS would not have been liable for the 4% employee PRSI that other workers in receipt of “normal wages” would have faced and would be better off to that extent. The only other difference in treatment between “normal wages” and TWSS payments is that the latter were not taxed in real time but were instead liable to income tax and USC at the end of 2020.
The Government was clear from the outset that TWSS payments were taxable and, in the interests of equity for all taxpayers, there are no plans to alter this approach.
The TWSS was replaced by the Employment Wage Subsidy Scheme (EWSS) with effect from 1 September 2020.
EWSS payments were not made to the employee but were made directly to employers as a per-head subsidy for each employee, and the employer was expected to pay their employees their “normal wages”. The employee was taxed in real time on these wages in the normal manner and, consequently, they would not have suffered additional tax because their employer opted into the scheme.
311. Deputy James Lawless asked the Minister for Finance if he will examine an issue regarding the benefit-in-kind tax (details supplied); and if he will make a statement on the matter. [63458/22]
View answer319. Deputy Michael Lowry asked the Minister for Finance if he will consider delaying the implementation of the new benefit-in-kind regime for company vehicles, which is scheduled to begin in 2023, given the broader context of rising living costs and the fact that these changes will reduce income for workers who require a company vehicle to perform their duties; and if he will make a statement on the matter. [63890/22]
View answer335. Deputy Michael Healy-Rae asked the Minister for Finance if he intends to make any further changes to the benefit-in-kind tax (details supplied); and if he will make a statement on the matter. [1270/23]
View answer352. Deputy Brian Stanley asked the Minister for Finance if his attention has been drawn the fact the changes to the benefit-in-kind taxation applicable from 1 January 2023 now mean some middle-income earners have had their benefit-in-kind more than double; and if he will request his senior officials to re-examine the new criteria. [1596/23]
View answerI propose to take Questions Nos. 311, 319, 335 and 352 together.
Recent Government policy has focused on strengthening the environmental rationale behind company car taxation. Until the changes brought in as part of the Finance Act 2019, Ireland’s vehicle benefit-in-kind regime was unusual in that there was no overall CO2 rationale in the regime. This is despite a CO2 based vehicle BIK regime being legislated for as far back as 2008 (but never having been commenced).
In Finance Act 2019, a CO2-based BIK regime for company cars was legislated for from 1 January 2023. From the beginning of this year, the amount taxable as BIK is determined by the car’s original market value (OMV) and the annual business kilometres driven, while new CO2 emissions-based bands determines whether a standard, discounted, or surcharged rate is taxable. The number of mileage bands has reduced from five to four.
In certain instances, this new regime will provide for higher BIK rates, for example in relation to above average emissions and high mileage cars. It should be noted, however, that the rates remain largely the same in the lower to mid mileage ranges for the average lower emission car. Additionally, EVs benefit from a preferential rate of BIK, ranging from 9 – 22.5% depending on mileage. Fossil-fuel vehicles are subject to higher BIK rates, up to 37.5%. This new structure with CO2-based discounts and surcharges is designed to incentivise employers to provide employees with low-emission cars.
I am aware there have been arguments surrounding the mileage bands in the new BIK structure, as they can be perceived as incentivising higher mileage to avail of lower rates, leading to higher levels of emissions. The rationale behind the mileage bands is that the greater the business mileage, the more the car is a benefit to the company rather than its employee (on average); and the more the car depreciates in value, the less of a benefit it is to the employee (in years 2 and 3) as the asset from which the benefit is derived is depreciating faster. Mileage bands also ensure that cars that are more integral to the conduct of business receive preferential tax treatment.
I believe that better value for money for the taxpayer is achieved by curtailing the amount of subsidies available and building an environmental rationale directly into the BIK regime. It was determined in this context that reforming the BIK system to include emissions bands provides for a more sustainable environmental rationale than the continuation of the current system with exemptions for electric vehicles (EVs). This brings the taxation system around company cars into step with other CO2-based motor taxes as well as the long-established CO2-based vehicle BIK regimes in other member states.
In addition to the above and in light of government commitments on climate change, Budget 2022 extended the preferential BIK treatment for EVs to end 2025 with a tapering mechanism on the vehicle value threshold. This BIK exemption forms part of a broader series of very generous measures to support the uptake of EVs, including a reduced rate of 7% VRT, a VRT relief of up to €5,000, low motor tax of €120 per annum, SEAI grants, discounted tolls fees, and 0% BIK on electric charging.
Finally, it should be noted that this new BIK charging mechanism was legislated for in 2019 and was announced as part of Budget 2020. I am satisfied that this has provided a sufficient lead in time to adapt to this new system before its recent implementation.
313. Deputy Richard Boyd Barrett asked the Minister for Finance the tax implications for a Canadian citizen resident in Ireland who receives a financial gift from their sibling resident in Bahrain; and if he will provide the details of any tax-free allowances and so on associated with same. [63614/22]
View answerI have been advised by Revenue that, based on the information provided, it is not possible to provide a definitive view of the tax implications in this case and direct contact with Revenue is recommended.
Where a gift (or inheritance) is within the charge to Irish CAT, the tax liability will be computed in accordance with the relevant provisions of CATCA 2003.
For CAT purposes, the relationship between the disponer and the beneficiary determines the maximum amount, known as the “Group threshold”, below which CAT does not arise. Any prior gift or inheritance received by a beneficiary since 5 December 1991 from within the same Group threshold is aggregated 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 Group threshold, CAT at a rate of 33% applies on the excess benefit. There are three Group thresholds:
- the Group A threshold (currently €335,000) applies, inter alia, where the beneficiary is a child (including adopted child, stepchild and certain foster children) 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.
The Group thresholds do not apply to gifts and inheritances between spouses / civil partners, which are exempt from CAT.
In addition, a person may receive gifts up to a total value of €3,000 from any other person in any calendar year without having to pay CAT (the “small gifts exemption”). Gifts within this limit are not taken into account in computing tax and are not included for aggregation purposes. The relationship between disponer and beneficiary is not relevant for the purpose of the small gifts exemption. Where a person receives gifts from a number of different disponers in any calendar year, he/she will be entitled to a small gift exemption of €3,000 in respect of each disponer.
Where a liability to CAT arises on a gift or inheritance and a similar foreign tax is payable on the same property, relief from double taxation may be available. Ireland has two double taxation treaties for CAT purposes, one with the United Kingdom (UK) and one with the United States of America (USA). The convention between Ireland and the USA covers inheritance tax in Ireland and federal estate taxes in the USA. It does not apply to gift tax. For countries where there is no double taxation treaty in force, unilateral relief may be available in respect of gifts and inheritances of foreign property. Information on the circumstances in which such relief may be available, and how the relief is computed, is available on the Revenue website at revenue.ie/en/gains-gifts-and-inheritance/credits-you-can-claim-against-cat/index.aspx.
As it is not possible to provide a definitive view in this case, the individuals concerned may wish to seek guidance directly from Revenue. Contact details for the National Capital Acquisitions Tax Unit are available on the Revenue website at revenue.ie/en/contact-us/customer-service-contact/national-capital-acquisitions-tax-cat-unit.aspx.
314. Deputy Neale Richmond asked the Minister for Finance if performing mortgages sold by a bank (details supplied) after the economic crash should retain their original terms and conditions, including interest rates, and be afforded the same protections afforded to mortgage customers from traditional banks; and if he will make a statement on the matter. [63627/22]
View answerWhere a mortgage or other credit agreement is sold or assigned the terms and conditions of the agreement, including those terms in relation to the interest rate, remain in place and the entity which acquires the agreement cannot be in a better position than the entity which sold the agreement and cannot unilaterally change the terms of the agreement.
In terms of regulation, the Central Bank has put in place a range of measures in order to protect consumers who take out or have a mortgage. This consumer protection framework seeks to ensure that lenders are transparent and fair in all their dealings with borrowers and that borrowers are protected from the beginning to the end of the mortgage life cycle, for example, through protections at the initial marketing/advertising stage, in assessing the affordability and suitability of the mortgage and at a time when borrowers may find themselves in financial difficulties. The requirements put in place by the Central Bank complement the European legislative framework, including the European Union (Consumer Mortgage Credit Agreements) Regulations 2016.
Where a loan is sold or assigned to another entity, the consumer protections that were available to borrowers prior to the transaction continue to be in place with the new owner. It is worth noting that under the Consumer Protection (Regulation of Credit Servicing Firms) Acts 2015 and 2018 if a loan is assigned or sold, the new holder of the legal title to the credit and the servicer must be regulated and must act in accordance with Irish financial services law that applies to ‘regulated financial service providers’. This ensures that consumers whose loans are sold or assigned maintain the same regulatory protections that they had, including under the various Central Bank statutory Codes of Conduct such as the Consumer Protection Code 2012 and the Code of Conduct on Mortgage Arrears 2013.
In this regard the Deputy may wish to note that, in the case of variable rate mortgage holders, the Central Bank introduced a number of increased protections in February 2017. The enhanced measures, which are provided for in an Addendum to the Consumer Protection Code 2012, require regulated entities to explain to borrowers how their variable interest rates have been set, including in the event of an increase. The measures also improve the level of information required to be provided to borrowers on variable rates annually about other mortgage products available from the entity which could provide savings for the borrower. The regulated entity must also signpost the borrower to the CCPC’s mortgage switching tool. However, subject to the terms of any individual contract, decisions on the level of interest rates or the provision of credit are commercial matters for the individual regulated entity.
More generally, the Central Bank has advised that it expects that all regulated entities take a consumer-focused approach in respect of any decision that affects their customers (existing and new) and to communicate clearly, effectively and in a timely manner with all customers.
315. Deputy Matt Shanahan asked the Minister for Finance the total number of determinations arrived each year at by the Tax Appeals Commission for the years 2020 to 2022; the detail of the findings arrived at for each case as to whether they found in favour of or against the taxpayer concerned; and if he will make a statement on the matter. [63662/22]
View answerIn response to the Deputies’ question I am informed by the Tax Appeals Commission that it does not separately record whether determinations are in favour of or against the taxpayer concerned. The Appeal Commissioners issue determinations based on the facts presented to them and the application of the relevant legislation pertaining to the appeal.
All determinations are published on the Commission’s website in accordance with Section 949A0 of the Taxes Consolidation Act 1997 and can be viewed by any member of the public. Each determination details the findings of each appeal and if it was in favour or against the taxpayer concerned. In addition to this, a searchable database of all published determinations from 2016 is also available on the website which provides a brief summary of the determination topic and legislation referred to within each determination.
However, in order to assist the Deputy with his question, a review of all determinations issued in 2020 to 2022 was conducted recently by the Commission and the following table provides an outline of the results therein:
|
|
In favour of Taxpayer |
In favour of Revenue |
Total |
|
2020 |
44 |
127 |
171 |
|
2021 |
35 |
95 |
130 |
|
2022 |
35 |
155 |
190 |
|
Total |
114 |
377 |
491 |
Determinations issued from 2020*
* Please note that some determinations were partly successful for taxpayers. In these cases, for record purposes, the appeal was recorded as in favour of the party that received the greater benefit.
316. Deputy Michael Healy-Rae asked the Minister for Finance when a mortgage customer (details supplied) will be given further information on what will happen in 2023 regarding their mortgages; and if he will make a statement on the matter. [63807/22]
View answerIn 2021, Ulster Bank announced its intentions to commence a phased withdrawal from the Irish market. As part of this process, Ulster Bank plans to transfer its loans, including mortgages, to other providers.
While it is regrettable that Ulster Bank has decided to exit the market, as Minister for Finance, I do not have a role in the operations of any bank operating within the State. My priority now is that the withdrawal takes place in an orderly manner and the importance of this is emphasised in all engagements with Ulster Bank.
The consumer protection framework seeks to ensure that lenders are transparent and fair in all their dealings with borrowers and that borrowers are protected from the beginning to the end of the mortgage life cycle.
Where the consumer’s mortgage is being transferred to another provider, the consumer will receive at least 2 months’ notice, in line with provision 3.11 of the Consumer Protection Code 2012.
When a mortgage or other credit agreement is sold or assigned the terms and conditions of the agreement, including those terms in relation to the interest rate, remain in place and the entity which acquires the agreement cannot be in a better position than the entity which sold the agreement and cannot unilaterally change the terms of the agreement.
In addition, a loan that is sold or transferred to another regulated entity, the protections that were available to borrowers prior to the transaction continue to be in place with the new owner. It is worth noting that under the Consumer Protection (Regulation of Credit Servicing Firms) Act 2018 if a loan is transferred or sold, the holder of the legal title to the credit must be regulated and must act in accordance with Irish financial services law that applies to ‘regulated financial service providers’.
This ensures that consumers whose loans are sold or transferred, maintain the same regulatory protections that they had, including under the various Central Bank statutory Codes of Conduct, such as the Consumer Protection Code 2012 and the Code of Conduct on Mortgage Arrears 2013 (CCMA).
It should also be noted that where a mortgage is fully performing, customers are entitled to switch their mortgage to another provider at any stage, subject to the new lender’s lending criteria and terms and conditions.
The Central Bank and I expect all regulated entities to take a consumer-focused approach in respect of any decision that affects their customers (existing and new) and communicate clearly, effectively, and in a timely manner with all customers.
Further information on the withdrawal and mortgages are available on Ulster Bank’s website.
317. Deputy Louise O'Reilly asked the Minister for Finance if his attention has been drawn to the fact that company cars are generally leased on long-term leases meaning that persons with such cars are tied into long-term leases which they cannot readily terminate (details supplied); and if he will make a statement on the matter. [63878/22]
View answerI understand that the Deputy is referring to hire purchase agreements on a business-to-business basis.
Consumer type agreements are regulated by the Central Bank and under recent legislation - the Consumer Protection (Regulation of Retail Credit and Credit Servicing Firms) Act 2022 – it was provided that any entity which provides directly or indirectly credit, hire purchase and consumer hire agreements to a relevant person falls within the authorisation scope of the Central Bank and accordingly it will be able to apply any code or regulation it makes to such a regulated entity.
However, hire purchase agreements on a business-to-business basis are currently not regulated by the Central Bank. These business-to-business agreements are a matter of contract law between those businesses involved.
However, the Minister notes the Retail Banking Review examined the provision of credit to SMEs and other related issues. Its recommendations, which were approved by Government in November 2022, include, inter alia, that:
‘Following consultation with stakeholders, the Department of Finance should prepare legislation to require providers of credit to SMEs to be authorised and supervised by the Central Bank, so that all SME borrowers benefit from the protections of the Central Bank’s SME Regulations’.
318. Deputy Michael Creed asked the Minister for Finance if a person (details supplied) in County Cork is entitled to a refund in respect of medical expenses incurred. [63882/22]
View answerSection 469 of the Taxes Consolidation Act 1997 (TCA 1997) provides for income tax relief in respect of qualifying health expenses. Such relief may be claimed where the person making the claim satisfies the conditions of the relief and has paid income tax in the relevant period.
In the case raised by the Deputy, I am advised by Revenue that according to its records the person concerned did not pay income tax for the period in question. As such, there is no income tax to be refunded in this particular case.
320. Deputy Patrick O'Donovan asked the Minister for Finance if limitations placed on housebuilding by Irish Water in towns nationwide will be taken into consideration in the context of the imposition of a tax, following the decision to impose a levy on lands zoned for housing in towns nationwide; and if he will make a statement on the matter. [63976/22]
View answerThe Residential Zoned Land Tax is identified as action 15.2 in Housing for All to replace the Vacant Site Levy and increase housing supply through activating zoned and serviced residential development land for housing. The RZLT is a two stage process, involving identification of land meeting the criteria for the tax on maps to be prepared by local authorities and the administration of the tax by the Revenue Commissioners.
Section 653B of the Taxes Consolidation Act 1997 sets out the criteria for inclusion on the map. In addition to being suitably zoned, the land must be connected or able to connect to services, including those under the remit of Irish Water such as water supply and waste water treatment. In addition the legislation states that there must be sufficient service capacity available for such development.
Ministerial Guidelines for Planning Authorities on the Residential Zoned Land Tax were issued under Section 28 of the Planning and Development Act 2000 (as amended) in June 2022 by the Minister for Housing, Local Government and Heritage providing guidance to local authorities on identifying and mapping land liable to the tax, including the need for interaction with key stakeholders.
I am informed by the Department of Housing, Local Government and Heritage that Irish Water have engaged with all local authorities prior to the publication of the draft maps on 1 November regarding network availability and water and waste water treatment capacity for settlements. This information was utilised by local authorities as an aid to determining which lands meet the criteria for the tax.
In addition section 4.1.1(iii) of the Guidelines identify criteria which planning authorities should consider in determining if land is serviced or able to be serviced and whether lands benefit from available treatment capacity. Furthermore, section 4.1.1(iv) identifies interaction with and use of information sources from Irish Water as being a key determinant regarding whether lands meet the criteria for the tax. The planning authority are the appropriate determining authority on whether land meets the criteria based on information available to them, including from stakeholders such as Irish Water.
The draft maps indicating land subject to the tax were published by all 31 local authorities on 01 November 2022, and landowners and other interested parties could make submissions on the draft maps to the relevant local authority until 01 January 2023. This allowed an opportunity for landowners to demonstrate that land within their ownership does not meet the criteria set out within the legislation, including in relation to servicing from an Irish Water perspective. The Guidelines at Section 3.2.3 outline a legislative provision which allows for interaction with stakeholders including Irish Water as a consequence of submissions received during the public display periods, where deemed necessary.
Where submissions raise issues regarding access to the water or waste water network or lack of available treatment capacity, the planning authority may seek further information from a stakeholder such as Irish Water to assist them in making a determination by 1 April regarding whether the land remains liable to the tax, or whether it fails to meet the relevant criteria and should be removed from the map and therefore not subject to the tax. Where the owner of a site has made a submission by 1 January under Section 653D(1) of the Taxes Consolidation Act 1997, and received a determination by 1 April under Section 653E(1)(iii) which they are aggrieved with, they may appeal the determination to An Bord Pleanala by 1 May. The outcome of any submissions and appeals will be reflected in the final maps, which will be reviewed annually by local authorities.
321. Deputy Éamon Ó Cuív asked the Minister for Finance the reason that bulk liquefied petroleum gas, LPG, supplied to businesses is not included under the business energy support scheme when metered gas is included; if he accepts that this affects mainly rural areas where metered gas is not available; if he intends extending the scheme to include LPG; and if he will make a statement on the matter. [63998/22]
View answerDetails of the new Temporary Business Energy Support Scheme (TBESS) are set out in Finance Act 2022. The TBESS is available to tax compliant businesses carrying on a trade or profession the profits of which are chargeable to tax under Case I or Case II of Schedule D where they meet the eligibility criteria and to certain sporting bodies and charities. The scheme operates on a self-assessment basis.
In accordance with the scheme rules, the TBESS only applies to the metered supply of natural gas and electricity.. The scheme is designed around determining increases in unit prices and actual consumption for each month falling within the period of the scheme as compared to the same month in the previous year based on information made available through electricity and gas meters.
For energy sources such as oil and LPG, it would be difficult to accurately determine the actual usage for each claim period (month), the relevant unit price for each claim period, or the actual increase in that unit price and usage over the same period in the reference period. For instance, an oil tank could be filled during the summer, with the oil being used in the winter months, or in February 2023 with the oil being used in the months that follow.
The TBESS is currently due to expire at the end of February and, in that context, in the coming weeks I will examine the operation of the scheme.
322. Deputy Seán Haughey asked the Minister for Finance if he will exempt antigen tests from VAT; and if he will make a statement on the matter. [64000/22]
View answer326. Deputy Cian O'Callaghan asked the Minister for Finance if he will ensure that the 23% VAT rate on antigen tests will continue to be waived in order that persons have cost-effective access to testing; and if he will make a statement on the matter. [1067/23]
View answerI propose to take Questions Nos. 322 and 326 together.
As the Deputies will be aware, VAT on supplies of Covid 19 testing kits have been subject to a temporary zero rate up until 31 December 2022 as a result of an EU Commission derogation.
I am currently engaging with my officials and the Revenue Commissioners in relation to this matter.
323. Deputy Emer Higgins asked the Minister for Finance the measures that are in place to assist persons who feel that their pension was devalued by mismanagement through a company wind-up but who cannot be assisted by the ombudsman given that the pension scheme in question no longer exists (details supplied); and if he will make a statement on the matter. [1014/23]
View answerThe Office of the Financial Services and Pensions Ombudsman (FSPO) was established under the Financial Services and Pensions Ombudsman Act 2017 (“the Act”) to resolve complaints about the conduct of financial service providers and pension providers.
The FSPO can, subject to time limits, investigate a complaint submitted by an individual pension scheme member, where financial loss has been suffered by the member, as a result of the miscalculation of the complainant’s pension benefit entitlements, owing to maladministration by the pension provider.
A grievance concerning the impact on the overall value of a pension scheme, arising from a company wind-up, is not however a matter that falls within the jurisdiction of the FSPO.
The Pensions Act 1990 sets out the obligations and responsibilities regarding the wind-up of pension schemes. The Pension Authority is the relevant regulatory body to ensure compliance with the requirements of the Act in such an instance.
The Pensions Authority, which is a body under the aegis of the Department of Social Protection, has detailed information on its website in relation to the winding up of a scheme.
324. Deputy Michael Ring asked the Minister for Finance if he will amend the temporary business energy support scheme to include costs for bulk LPG in areas where natural gas is not an option for businesses; and if he will make a statement on the matter. [1030/23]
View answer327. Deputy Louise O'Reilly asked the Minister for Finance the reason that liquid petroleum gas has been excluded from the temporary business energy support scheme. [1068/23]
View answerI propose to take Questions Nos. 324 and 327 together.
Details of the new Temporary Business Energy Support Scheme (TBESS) are set out in Finance Act 2022. The TBESS is available to tax compliant businesses carrying on a trade or profession the profits of which are chargeable to tax under Case I or Case II of Schedule D where they meet the eligibility criteria and to certain sporting bodies and charities. The scheme operates on a self-assessment basis.
In accordance with the scheme rules, the TBESS only applies to the metered supply of natural gas and electricity. The scheme is designed around determining increases in unit prices and actual consumption for each month falling within the period of the scheme as compared to the same month in the previous year based on information made available through electricity and gas meters.
For energy sources such as oil and LPG, it would be difficult to accurately determine the actual usage for each claim period (month), the relevant unit price for each claim period, or the actual increase in that unit price and usage over the same period in the reference period. For instance, an oil tank could be filled during the summer, with the oil being used in the winter months, or in February 2023 with the oil being used in the months that follow.
The TBESS is currently due to expire at the end of February and, in that context, in the coming weeks I will examine the operation of the scheme.
325. Deputy Mick Barry asked the Minister for Finance if he will investigate the taxation of HVO in home heating boilers; and if he will make a statement on the matter. [1064/23]
View answer334. Deputy Colm Burke asked the Minister for Finance if consideration will be given to reclassifying hydrotreated vegetable oil as a home heating fuel, in view of the fact that it is currently rated as a transport fuel and is therefore more expensive to purchase than kerosene; and if he will make a statement on the matter. [1240/23]
View answerI propose to take Questions Nos. 325 and 334 together.
Finance Act 1999 provides for the application of excise duty in the form of Mineral Oil Tax (MOT) to liquid fuels. MOT is comprised of a non-carbon component and a carbon component with the carbon component being commonly referred to as carbon tax. The non-carbon component of MOT is often referred to as “excise”, “fuel excise”, “fuel tax” or “fuel duty” but it is important to note that both components are part of MOT which is an excise duty.
As outlined in my predecessor Minister Donohoe’s recent responses to questions about biofuels and Hydrogenated/Hydrotreated Vegetable Oil (HVO), the State’s MOT law - as governed by Council Directive 2003/96/EC of 27 October 2003, commonly known as the Energy Tax Directive (ETD) - relieves biofuels from the carbon component of MOT. This relief has been in place since 2012 and is set out in section 100(5)(a) of Finance Act 1999. Where a fuel meets the criteria of being produced entirely from biomass no carbon taxation currently applies under MOT law.
In addition to the biofuel relief from carbon taxation, Finance Act 1999 provides for differentiated MOT rates for propellant fuels and fuels used for other purposes. This means that fuels used for heating are not subject to the significantly higher rates of MOT that apply to road vehicle propellants. Liquid fuels such as HVO, which are not specified mineral oils, are defined in MOT legislation as substitute fuels. A substitute fuel used for heating purposes is chargeable, under section 96(2A)(c) of Finance Act 1999, at the MOT rate that applies to Marked Gas Oil (MGO). This rate is currently €111.14 per 1,000 litres and is comprised entirely of carbon tax. As the carbon tax is fully relieved for biofuels no MOT currently applies to biofuels used for heating purposes. With regard to blended fuels produced partially from biomass, the relief applies to the biofuel portion. Full details on MOT rates are published on the Revenue website at revenue.ie/en/tax-professionals/tdm/excise/excise-duty-rates/energy-excise-duty-rates.pdf
The relief from the carbon component of MOT for biofuels reflects a clear policy to incentivise the use of such fuels. As the ten-year trajectory of carbon tax increases introduced in Finance Act 2020 are implemented, the tax differential between biofuels and fossil fuels will continue to widen, further incentivising the uptake of biofuels.
In relation to Value-Added Tax (VAT), the VAT rating of goods and services is subject to EU VAT law, with which Irish VAT law must comply. In general, the EU VAT Directive provides that all goods and services are liable to VAT at the standard rate unless they fall within Annex III of the Directive, in respect of which Member States may apply either one or two reduced rates of VAT. Ireland currently operates two reduced rates of VAT, 13.5% and 9%, as permitted by the Directive. Motor fuels such as petrol including bio-ethanol petrol blends and auto-diesel are not included in the categories of goods and services on which the EU Directive allows a lower rate of VAT or an exemption to be applied, and so they are liable to VAT at the standard rate, currently 23%. Biofuel and non-food vegetable oils, such as HVO, used to fuel vehicles also attract the standard rate of VAT. HVO used as heating fuel is liable for the reduced VAT rate of 13.5%.
