Written Answers Nos. 306-320
306. Deputy Michael McNamara asked the Minister for Finance how many representations by solicitors for a client were made in relation to prize bonds in each of the past 20 years, in tabular form; and if he will make a statement on the matter. [36130/23]
View answerI am advised by the National Treasury Management Agency who manage State Savings that requests from solicitors are common in cases of estate management but such information is retained on individual customers’ files and is not retained in tabular form. Given the number of Prize Bond customers it would not be possible to research and tabulate this information.
307. Deputy Michael McNamara asked the Minister for Finance the mechanism the NTMA uses to ensure that prize bonds winnings are available during the disposal of a deceased person's estate by the estate's executor; and if he will make a statement on the matter. [36131/23]
View answerI am advised by the National Treasury Management Agency who manage State Savings that all Prize Bonds are included in Prize Bond draws until encashed. Prize money is paid as per response to question 36127/23, but where historically a cheque was not cashed or the recipients address no longer proved valid all prize winnings are held until claimed by the winner(s) or in the case of the deceased by their estate.
308. Deputy Michael McNamara asked the Minister for Finance if the NTMA attempts to contact the owners of prize bond accounts whom the NTMA may have reason to believe are deceased; and if he will make a statement on the matter. [36132/23]
View answerI am advised by the National Treasury Management Agency who manage State Savings that as mentioned in reply to question 36127/23, Prize Bond winners are notified of their winnings.
Unfortunately, if the winner has changed their address or contact details and has not told State Savings then they may not receive the notification and State Savings has no way to contact them until such information is received. The NTMA has no way of assuming the death of a holder until notified by those managing their estate.
There is a process then undertaken to search for any Prize Bonds held in the person’s name and any prizes under the details provided by the person in charge of their Estate.
309. Deputy Michael McNamara asked the Minister for Finance if there is a cut-off point past which prize bond winnings cannot be claimed; if so, if he will provide the occurrences of such in each of the past 20 years, in tabular form; and if he will make a statement on the matter. [36133/23]
View answerI am advised by the National Treasury Management Agency who manage State Savings that there is no cut-off point for claiming prizes.
Prize Bond winnings are paid automatically with prize winners being notified of all prizes at their registered address. Up to February 2020 cheques, reinvestment of winning prize or Electronic Funds Transfers (EFT) were processed for Prize Bond winners. Since February 2020, Prize bonds winners may choose for prizes to be automatically paid into their bank account or for prizes to be automatically invested into Prize Bonds.
310. Deputy Ged Nash asked the Minister for Finance if he is aware of an anomaly in the application of the zero VAT rate on books and e-books that exempts popular online audiobook platforms (details supplied) which are judged to be providing a digital service and are therefore obliged to charge VAT; if he will address this anomaly that unfairly discriminates against those with visual impairments; and if he will make a statement on the matter. [36145/23]
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. In general, the EU VAT Directive provides that all goods and services are liable to VAT at the standard rate, unless they fall within categories of goods and services specified in Annex III of the VAT Directive, in respect of which Member States may apply a lower rate of VAT. Currently, Ireland has two reduced rates of 13.5% and 9%.
Historically Ireland applied a zero rate of VAT to the supply of printed books on the basis of a historical derogation which could not be expanded. Following an agreement on VAT rates in 2022, Member States can now apply a reduced rate lower than the 5% minimum and a zero-rate to certain categories in Annex III, namely supplies covered by categories (1) to (6) and (10c). These cover food, water, medicine, medical equipment, transport, books, electronic publications, and solar panels.
Ireland now applies the zero rate of VAT to the supply of printed books and to most printed and electronic newspapers. The 9% VAT rate applies to the supply of most other electronic publications, including both e-books and audiobooks. However, the standard rate of VAT applies to the supply of electronic newspapers and electronic publications that are wholly or predominantly devoted to advertising or consist wholly or predominantly of audio music or video content.
Future tax changes are generally taken in the context of the Budget. You will be aware that my officials prepare a series of papers containing tax options for the Tax Strategy Group to be considered in the context of the budgetary process. In addition, a wide range of submissions are received from various stakeholders and lobby groups which are also considered as part of the budgetary process.
As the Deputy will be aware, it is a long-standing practice that the Minister for Finance does not comment, in advance of the Budget, on any tax matters that might be the subject of Budget decisions.
311. Deputy Michael Ring asked the Minister for Finance to detail the mechanism by which 'brand ambassadors' who receive vehicles from motor companies can pay benefit-in-kind when they are not on the payroll of these companies, have no employment status with these companies and cannot record an annual mileage in performing their duties for these same companies. [36153/23]
View answer312. Deputy Michael Ring asked the Minister for Finance if a 'brand ambassador' for a motor company has a benefit-in-kind liability if he/she has a vehicle on lease from the company at well below the market rate; and if he will outline the steps he is taking to ensure that there is a fair application of this benefit-in-kind to all taxpayers. [36154/23]
View answerI propose to take Questions Nos. 311 and 312 together.
I am advised by Revenue that the tax treatment regarding the provision of a vehicle to an individual depends on a number of factors, including:
• the employment status of the individual;
• the nature of the benefit received (including in the case of a vehicle, whether ownership is transferred to the individual); and
• the circumstances under which the benefit is provided.
Employer provided vehicles
Sections 121 and 121A of the Taxes Consolidation Act 1997 provides that where a car or a van is made available for the private use of an employee then the employee is chargeable to benefit in kind tax (BIK), this applies whether the vehicle is owned by the employer or leased.
A vehicle is regarded as being made available to an individual by reason of his or her employment if it is made available to them by his or her employer (or a person connected with the employer).
Where such a benefit is provided for an employee by his or her employer, the employer is required to include that notional payment as part of the employee’s emoluments and to deduct tax via the PAYE system accordingly.
From 1 January 2023 the cash equivalent of the use of a car for the purpose of calculating the amount taxable as a BIK is determined by the car’s original market value (OMV), the annual business kilometres driven and the CO2 emissions category of the car. The latter determines whether a standard, discounted, or surcharge rate applies. In addition, the Deputy should note that Finance Act 2023 introduced a temporary measure for the year of assessment 2023, which provides for a €10,000 reduction to be applied to the OMV of cars in Category A, B, C and D for 2023 (it does not apply to cars in Category E).
Vehicles provided by reason of employment by Third Parties
If an individual has, by reason of his or her employment, a vehicle available for his or her private use, a taxable BIK arises even if the person providing the vehicle is not the individual’s employer.
In such circumstances, it is broadly the third party who provided the benefit that is responsible for accounting for the PAYE, PRSI and USC on same via the PAYE system.
However, the facts, circumstances, arrangements etc. relating to the benefit must be examined before the correct tax treatment can be determined in each case.
Vehicles provided otherwise than in the capacity of employee
Where an individual is provided with the use of a vehicle, otherwise than in their capacity as an employee, and in circumstances where the individual agrees to provide a service, such as involving the promotion and marketing of the particular car brand, the individual will, depending on the particular facts and circumstances, be subject to tax under either Schedule D Case I/II or Case IV.
If the service is provided in the carrying on of a trade/profession, a charge to tax under Case I/II will apply. A charge to tax under Case IV will apply in circumstances where the service is carried on otherwise than in the course of a trade. The taxable amount in each case would generally be based on a fair value of the use of the car.
Application of tax
I am advised by Revenue that the collection of tax is based on a self-assessed system, as such it is the responsibility of each taxpayer to ensure they comply with their tax payment and filing obligations.
As part of its Compliance Intervention Framework Revenue monitors tax compliance on an ongoing basis, using a proportionate and focused approach to identify and respond to risks.
I am advised by Revenue that further information on the taxation of employer-provided vehicles is available on Revenue’s website, which is available at the following links:
• www.revenue.ie/en/tax-professionals/tdm/income-tax-capital-gains-tax-corporation-tax/part-05/05-01-01b.pdf.
• www.revenue.ie/en/employing-people/benefit-in-kind-for-employers/private-use-companycars/index.aspx.
Finally, further information on the provision of third-party benefits to employees can be found in Tax and Duty Manual Part 05-01-01m, which is available at the following link:
• www.revenue.ie/en/tax-professionals/tdm/income-tax-capital-gains-tax-corporation-tax/part-05/05-01-01m.pdf.
313. Deputy Róisín Shortall asked the Minister for Finance if his attention has been drawn to concerns such as those raised in correspondence (details supplied) regarding the acquisition of insurance cover; whether there exists standardised guidelines for insurance companies in terms of dealing with customers who do not have email addresses; and if he will make a statement on the matter. [36170/23]
View answerI note that the question relates to a specific case involving an insurer requiring a customer to have an email address to engage with its services. As the Deputy will appreciate, I am unable to comment on individual cases.
However, in order to be as helpful as possible, my officials contacted Insurance Ireland, and the Central Bank of Ireland, in relation to this query. On a general level, Insurance Ireland has advised that there are no standardised guidelines for consumers who do not have email addresses. However, Insurance Ireland stated that all of the primary insurers in the Irish market have call centres or utilise a network of brokers enabling consumers to transact business either over the phone or in person. I understand that some insurers for niche products may only offer cover directly via electronic means.
However, due to the limited details supplied, it was not possible to provide a comprehensive response. Notwithstanding this, Insurance Ireland operates an Insurance Information Service for members of the public who have queries, complaints or difficulties in relation to obtaining insurance, which may be of assistance. This can be accessed by calling 01-676-1820 or emailing feedback@insuranceireland.eu.
It should also be noted that technology-driven risks was one of the key drivers of consumer risk identified in the Central Bank of Ireland’s Consumer Protection Outlook Report 2023. The Central Bank expects that “as firms move from traditional delivery channels toward increasing reliance on digital interaction with consumers, they must manage this transition respecting the legitimate expectations of consumers”. Additionally, “adequate consideration must be given to consumers who rely on traditional means of interacting with firms, including the opportunity to have human interactions where necessary”.
Firms must also comply with the Central Bank’s Consumer Protection Code 2012. This includes a requirement that where a regulated entity has identified that a personal consumer is a vulnerable consumer, it must ensure that they are provided with such reasonable arrangements and/or assistance that may be necessary to facilitate them in their dealings with the regulated entity.
Finally, it may interest the Deputy to know that digitalisation has been identified as one of the key themes of the ongoing review of the Consumer Protection Code. The Discussion Paper published by the Central Bank as part of this review (October 2022), notes “the use of technology by consumers should serve their interests and not be viewed as an opportunity to take advantage of their behavioural vulnerabilities, or to increase information asymmetries between consumers and firms”. I understand that a Consultation Paper from the Central Bank, setting out specific proposals on how the Code should be updated and improved, is expected to be published in Q4 2023.
314. Deputy Róisín Shortall asked the Minister for Finance the estimated amount of additional revenue that would be raised in 2023 through a third rate of income tax of 41% on incomes above €100,000, as well as 42%, 43%, 44% and 45%, in tabular form; and if he will make a statement on the matter. [36187/23]
View answer315. Deputy Róisín Shortall asked the Minister for Finance the estimated amount of additional revenue that would be raised in 2023 through a third rate of income tax of 41% on incomes above €100,000, as well as 42%, 43%, 44% and 45%, assuming tax band indexation of 4%, in tabular form; and if he will make a statement on the matter. [36188/23]
View answerI propose to take Questions Nos. 314 and 315 together.
The Department of Finance has opened its pre-budget costings service, this is available with effect from 3 July 2023. The procedures for availing of this service are set out in a letter dated 3 July 2023 from the Secretary General of the Department to all recognised parties and technical groups in Dáil Éireann. To ensure efficiency and fairness all costing requests should be made in this manner, via the standard request format template, instead of the Parliamentary Question system at this time.
316. Deputy Niall Collins asked the Minister for Finance if there are any plans to increase the valuation limit to qualify for the help-to-buy scheme for a self-build home above €500,000, given the recent increase in building material costs; and if he will make a statement on the matter. [36208/23]
View answerThe Help to Buy (HTB) incentive is a scheme to assist first-time purchasers with the deposit they need to buy or build a new house or apartment. The incentive gives a refund on Income Tax and Deposit Interest Retention Tax paid in the State over the previous four years, subject to limits outlined in the legislation. Section 477C Taxes Consolidation Act 1997 outlines the definitions and conditions that apply to the scheme.
An increase in the supply of new housing remains a priority aim of Government policy. HTB is specifically designed to encourage an increase in demand for new build homes in order to support the construction of an additional supply of such properties. For a property to qualify for HTB, it must be new or converted for use as a dwelling, having not been previously been used as a dwelling. Additionally, the purchase value/approved valuation of the property must not exceed €500,000.
To end June 2023, 41,029 HTB claims have been made, of which 91% of claims were for properties which did not exceed €450,000 in value.
A comprehensive independent review of the scheme was carried out by external consultants last year. While this review included a number of recommended amendments to the scheme, it did not recommend an increase to the €500,000 house price limit. Ultimately, following consideration of the review, the decision taken in Budget 2023, and subsequently implemented through Finance Act 2022, was to extend HTB until the end of 2024 without amending the house price limit.
It remains the case that, as with any tax expenditure, HTB will be kept under regular review. However, there are currently no plans to extend the scheme to properties valued at over €500,000.
317. Deputy Róisín Shortall asked the Minister for Finance the rate at which the refundable portion of the research and development tax credit is taxed; the amount of taxation generated by the tax since 2018, in tabular form; and if he will make a statement on the matter. [36230/23]
View answerThe research and development (R&D) tax credit allows a company to claim a 25% tax credit in respect of expenditure incurred on qualifying R&D activities. To qualify for the R&D tax credit, a company must be within the charge to corporation tax in the State and must undertake qualifying R&D activities within the European Economic Area (EEA) or the UK and, in the case of an Irish tax resident company, the expenditure must not qualify for a deduction for the purposes of tax in another territory. In making a claim for the R&D tax credit, companies must satisfy two tests: the activity must be a qualifying activity (a science test) and the amount of the claim must be based on R&D expenditure incurred (an accounting test).
An R&D tax credit to which a company is entitled, including any refundable portion where relevant, is not taxable income and is not therefore subject to any rate of tax. The Deputy will be aware that Ireland is currently preparing for the implementation of the Pillar Two agreement on a minimum effective rate of corporation tax. This will bring certain tax credits, including the R&D tax credit, within scope of the minimum tax calculations, when introduced.
Information on the cost of the R&D tax credit is published annually by Revenue. The latest publication contains information in relation to the 2021 tax year and is available at: www.revenue.ie/en/corporate/documents/research/ct-analysis-2023.pdf.
318. Deputy Carol Nolan asked the Minister for Finance to address concerns that the introduction of the residential zoned land tax will have an adverse impact on farmers in terms of their ability to retain land for agricultural use; and if he will make a statement on the matter. [36299/23]
View answerThe Residential Zoned Land Tax (RZLT) is a new tax introduced in Finance Act 2021 which seeks to increase housing supply by encouraging the activation of development on lands which are suitably zoned and appropriately serviced. It aims to bring those lands which have benefitted from investment in services and are capable of being developed forward for housing. The tax is an action contained in Housing for All, the Government’s plan for housing, to increase housing supply and is supported in the Programme for Government.
The tax applies to land that is:
• zoned suitable for residential development whether it be solely or primarily for residential use, or for a mixture of uses, including residential use, and
• serviced. This means where it is reasonable to consider the land may have access, or be connected, to public infrastructure and facilities, including roads and footpaths, public lighting, foul sewer drainage, surface water drainage and water supply, necessary for dwellings to be developed and with sufficient service capacity available for such development.
In order to be liable for the tax the land must meet both criteria.
Each local authority, in preparing the draft RZLT maps, determined whether the zoned land is connected or able to connect to the six required categories of services. Any exclusions which would rule the land out of scope were applied. Each local authority then published a draft RZLT map identifying the land which meets the requirements of the legislation and which may be liable to the tax. The tax will first be due and payable in 2024.
It is important to note that, to come within the scope of RZLT, farmland must be both zoned for residential use and serviced. Farmland that is zoned for residential use, but which is not currently serviced, is not within the scope of the tax and will only come within the scope of the tax should the land become serviced at some point in the future.
Agricultural land which is zoned solely or primarily for residential use and meets the criteria set out within the legislation therefore falls within the scope of the tax. Agricultural land that is zoned for a mixture of uses including residential is not in scope. These zonings are considered to reflect the housing need set out within the core strategy for the relevant local authority area and landowners within such zonings may fall within the scope of the tax, in the interests of ensuring an appropriate supply of housing on zoned lands.
A landowner with land identified on any published draft map had the opportunity to make a submission to the relevant local authority regarding the land, setting out why they consider that the land does not meet the criteria for inclusion within the scope of the tax. For example, if the land is not zoned for residential use, if the land does not have access to or there is no capacity for any of the six servicing criteria, or if the land benefits from an exclusion as outlined in the legislation. Each local authority was required to assess any submission and inform the landowner of their decision to either remove or retain the land on the map by 1 April 2023. If dissatisfied with the decision of the local authority, the landowner could have appealed the determination to An Bord Pleanála, again setting out why the land does not meet the criteria for inclusion for the tax.
In addition to being able to make a submission regarding inclusion of land on a draft map, the landowner had the opportunity to submit a request to change the zoning of the land by variation of the adopted development plan. Where the zoning is amended to a use other than residential or mixed use including residential, it would not meet the criteria for the tax and would be removed from RZLT maps.
Decisions on whether to amend zonings as a result of submissions or at any other time are a matter for each local authority, taking into account the need to ensure that housing supply targets across the county can be met. Furthermore, provision is made in the Planning and Development Act 2000 for elected members to seek a report from their Chief Executive on the matter of proposed rezonings.
Furthermore, Finance Bill 2022 introduced an exemption for land that is within the scope of the tax but is subject to a contract that precludes the landowner from developing it. For the exemption to apply, the contract must have been entered into prior to 1 January 2022, i.e., prior to the introduction of RZLT. For example, where a farmer leased land prior to 1 January 2022 and the requisite conditions are met, the farmer may claim an exemption from the tax for the period of the lease.
It is acknowledged that the tax will impact on landowners, including farmers, however if the land in question is zoned for a particular purpose under a plan adopted by the local authority and has been subject to investment by the local authority and the State in the services necessary to enable development for housing to accommodate increased population, it is intended that the land should be used for housing. This tax measure is a key pillar of the Government’s response to address the urgent need to increase housing supply in suitable locations.
319. Deputy Darren O'Rourke asked the Minister for Finance the number of persons successfully prosecuted for tobacco and or cigarette smuggling in 2022 and to date in 2023, in tabular form. [36527/23]
View answerI am advised by Revenue that it implements a range of measures to identify and target the smuggling, supply or sale of illicit tobacco products, with a view to disrupting the supply chain, seizing the products and, where possible, prosecuting those involved. Revenue develops and shares intelligence on a national, EU and international basis, and deploys analytics and detection technologies and ensures effective risk focused deployment of resources in response to the threat and risk of tobacco smuggling.
The smuggling of tobacco products has a transnational and cross border dimension and, in addition to Revenue’s ongoing cooperation with An Garda Síochána in this area, I am advised that Revenue also works closely with its counterparts in other jurisdictions including colleagues in Northern Ireland through the Cross Border Joint Agency Task Force (JATF), and international bodies including OLAF (the EU’s anti-fraud agency), Europol and the World Customs Organisation.
I know that Revenue is strongly committed to confronting non-compliance, including tobacco smuggling. This commitment is given operational priority each year through Revenue’s business planning and delivery framework having regard to risk and national and international trends and developments within illegal trades and the modus operandi of those involved. Revenue’s actions under these operational plans are designed to maximise coordination and efficiency Revenue-wide and deliver the best impact for the effort involved and will be a key deliverable reflected in the Revenue 2023-2025 Statement of Strategy.
A breakdown of the number of persons successfully prosecuted for tobacco and/or cigarette smuggling in 2022 and to the end of June 2023 is provided below in tabular form:
|
Year |
Summary Prosecutions |
Indictable Prosecutions |
|
2022 |
20 |
4 |
|
2023 |
18 |
5 |
320. Deputy Eoin Ó Broin asked the Minister for Finance his views on the proposal to reduce VAT on repair services, such as cobblers and clothing menders, as a measure to support the circular economy. [36637/23]
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. In general, the EU VAT Directive provides that all goods and services are liable to VAT at the standard rate, unless they fall within categories of goods and services specified in Annex III of the VAT Directive, in respect of which Member States may apply a lower rate of VAT. Currently, Ireland has two reduced rates of 13.5% and 9%.
A reduced VAT rate of 13.5% already applies to the supply of repair services of cobblers and clothing menders.
