Tuesday, 10 Oct 2023

Written Answers Nos. 112-131

Tax Code

Questions (112)

Pearse Doherty

Question:

112. Deputy Pearse Doherty asked the Minister for Finance what legislative instruments exist to allow local authorities to introduce a "tourist tax" as a revenue-raising initiative. [43744/23]

Written answers

Minister for Finance

I have been advised that there is no legislative basis for local authorities to introduce a tourist tax.

Tax Collection

Questions (113)

Pearse Doherty

Question:

113. Deputy Pearse Doherty asked the Minister for Finance what measures have been implemented to allow for the investigation of properties which may be liable for the vacant home tax; and if he will make a statement on the matter. [43745/23]

Written answers

Minister for Finance

Vacant Homes Tax (VHT) is administered by Revenue in accordance with Part 22B of the Taxes Consolidation Act 1997 (TCA 1997). The first chargeable period for VHT is 1 November 2022 to 31 October 2023. A residential property will be within the scope of VHT if it has been occupied as a dwelling for less than 30 days in a chargeable period. The first self-assessed returns are due on 7 November this year and the tax will be payable on 1 January 2024.

A preliminary property register, developed by Revenue with data drawn from a range of sources including GeoDirectory, the Residential Tenancies Board and ESB Networks, has identified an initial subset of residential properties which may come within scope of VHT. This preliminary register is being used to issue correspondence to 25,000 property owners who are identified as being potentially liable for VHT to advise them of their obligations. Revenue may contact additional property owners at a later date following further data analysis.

Property owners who receive such correspondence are required to confirm their property’s occupation status by 7 November 2023, thereby determining their liability to VHT. Property owners are required to self-assess their liability to VHT and submit a return if they determine that VHT applies to their property, even if they do not receive correspondence from Revenue.

Where property owners fail to meet their VHT obligations, Part 22B of the TCA 1997 contains a number of provisions designed to encourage compliance with VHT and address non-compliance. Under VHT legislation, Revenue has powers to require a chargeable person to file a VHT return, make enquiries, raise Revenue assessments and amended Revenue assessments, and request that chargeable persons provide certain records.

Section 653BB of the Act provides that Revenue may issue a notice to a chargeable person, requiring them to provide records to demonstrate that their property was in use as a dwelling for 30 days or more in a chargeable period. Where such records are not provided, or where the records provided are insufficient, Revenue may deem the property to be vacant for the purposes of VHT. A chargeable person must keep appropriate records relating to relevant properties. Records are required to be kept for VHT purposes for 6 years from the end of the year in which the chargeable period ends or until the completion of any enquiries made by Revenue.

Furthermore, Section 653BF provides for a surcharge to be imposed where a chargeable person fails to file a correct VHT return by the deadline of 7 November 2023. A surcharge of 5% of the VHT payable will be imposed, where a late return is filed within 2 months of the filing deadline. The surcharge increases to 10% where the return is filed more than two months after the filing deadline. Section 653BG provides that Revenue may also apply a penalty, where the chargeable person fails to file a correct return by the due date. Section 653BE of the Act further provides for interest to be charged on late payment of VHT, at a rate of 0.0219% per day.

As with all tax and duty obligations Revenue’s approach is to seek to maximise voluntary compliance. Revenue has provided detailed information regarding VHT on its website at: www.revenue.ie/en/property/vacant-homes-tax/index.aspx.

Revenue has also published a VHT Tax and Duty Manual (TDM) which provides further detailed guidance on the tax. This is available at: www.revenue.ie/en/tax-professionals/tdm/income-tax-capital-gains-tax-corporation-tax/part-22b/22b-01-01.pdf.

In addition, Revenue provides comprehensive online services, as well as a designated Helpline (01 738 3626) to assist property owners in meeting their VHT obligations.

Tax Code

Questions (114, 120, 124, 125, 135, 138)

Seán Haughey

Question:

114. Deputy Seán Haughey asked the Minister for Finance if he will request that the Revenue Commissioners change their plans to make all GPs in partnerships, individually responsible for the income they receive from the general medical scheme and to pay tax accordingly given the problems this will cause in respect of the provision of GP services generally; the reason this change was considered; and if he will make a statement on the matter. [43756/23]

Ged Nash

Question:

120. Deputy Ged Nash asked the Minister for Finance if he is aware of a change of approach by the Revenue Commissioners to the tax affairs of general practitioners who hold general medical services contracts with the HSE, specifically those who operate within a partnership structure, as is common practice (details supplied); his views on whether the position should be reconsidered, as outlined in the correspondence provided; and if he will make a statement on the matter. [43916/23]

Bríd Smith

Question:

124. Deputy Bríd Smith asked the Minister for Finance if he can detail the consultations his Department has had with GP representative groups regarding proposed changes to the tax treatment of GMS income, specifically the proposal to have this income declared as income by individual GPs who at present are in partnerships or have such income mandated to employers; if he can detail any research on the possible impact of this proposal in terms of tax revenue and impact on GP partnerships; and if he will make a statement on the matter. [43975/23]

Bríd Smith

Question:

125. Deputy Bríd Smith asked the Minister for Finance if his Department has a proposal to change the tax treatment of GP partnerships and their income from the GMS scheme; and if he will make a statement on the matter. [43976/23]

Jim O'Callaghan

Question:

135. Deputy Jim O'Callaghan asked the Minister for Finance whether there is any legislative basis to the change proposed by the Revenue Commissioners on the way it treats the income GPs receive as payment for GMS/medical card services on 1 January 2024; if he can identify the basis and reason for such change; and if he will make a statement on the matter. [44044/23]

David Cullinane

Question:

138. Deputy David Cullinane asked the Minister for Finance the reason Revenue Commissioners are changing their approach to reckoning general medical services income being attributed to partnerships or employers, meaning that any such GMS income will need to be declared as income by the individual GMS list holder in their tax return from January 2024; and if he will make a statement on the matter. [44077/23]

Written answers

Minister for Finance

I propose to take Questions Nos. 114, 120, 124, 125, 135 and 138 together.

My Department and Revenue have, for some time, been aware of issues involving contractual arrangements which, in certain circumstances, has led to uncertainty within the General Practitioner (GP) community in relation to the tax treatment of General Medical Services (GMS) scheme income.

Revenue issued guidance to tax practitioners through the Tax Administration Liaison Committee in July of this year, which indicated that there would be a six-month transitional period for compliance with existing tax law, until 1 January 2024. However, Revenue are working to clarify the issues and hope to soon be in a position to publish supplementary guidance on this matter. Although this guidance is being widely reported as a proposed tax change, I would note that it does not, in fact, introduce a change to tax treatment of GPs. Instead, it simply clarifies the existing legal and administrative position.

In accordance with Section 58C of the Health Act, a GMS contract is between the HSE and an individual GP. My Department and Revenue understand that, as such, the HSE does not enter into GMS contracts with a medical practice, whether the practice is structured as a partnership or a company.

However, in some instances where an individual GP is an employee of a medical practice, the individual GP may agree, as part of their contract of employment with the practice, to assign their individual GMS income to the bank account of the medical practice and receive a salary or wages from the practice, as agreed within their employment contract.

In some other cases, where an individual GP is a partner in a medical practice, the GP may mandate that the GMS payments are made to the partnership rather than treating it as their own income, instead receiving a share of the partnership profits in line with their relevant partnership agreement.

Regardless of such arrangements, due to the nature of the contract between the HSE and the individual GP, under tax law, the GP who entered the contract with the HSE is chargeable person, or the ‘specified person’ in respect of Professional Services Withholding Tax (PSWT). In practice, what this means is that, even though their GMS income may have been paid into the medical practice’s bank account, relevant GPs who are currently employed and taxed under the PAYE system as employees or partners of the medical practice are required to make a return under the self-assessment system in respect of their GMS income. They are also able to make claims for the PSWT tax credit.

A determination by the Tax Appeals Commission in 2022 confirmed the legal position that GMS income is the income of the individual GP who has entered into the GMS contract. There is, therefore, no legal basis for Revenue to set aside a contract that has been entered into between a GP and the HSE so as to treat income belonging to an individual GP as income of another person or medical practice for tax purposes.

In an effort to find a solution to this issue, discussions have taken place between officials from my Department, Revenue, the HSE and the Department of Health. Furthermore, it would not be appropriate to make changes to tax legislation to accommodate contracts and practices of a particular sector of the economy where they can be changed by agreement of the participants.

My Department has not undertaken consultations with GPs on this issue, however, as previously indicated, Revenue have been advised on the matter by tax practitioners through the Tax Administration Liaison Committee. Although my Department and Revenue are conscious of the difficulties being experienced by GP practices, they must be cognisant of existing legislation. The approach being taken is intended to ensure that the tax treatment of GMS income reflects the contractual position. It is not related to any possible impact on tax revenue.

Given the core issue concerns the contractual arrangements involving GPs, there may be scope for the Department of Health and the HSE to examine the issue from a contractual viewpoint.

As Revenue are statutorily independent in the administration and operation of the tax code, the Deputies will appreciate that it would not be appropriate for me to request Revenue to make changes regarding this matter.

As it currently stands, the relevant tax policy and legislation remain unchanged, however, to assist GPs and medical practices in complying with their obligations under existing tax law, Revenue are allowing a transitional period to 1 January 2024 and are preparing further guidance to clarify the tax treatment of GMS income.

Tax Credits

Questions (115)

Aengus Ó Snodaigh

Question:

115. Deputy Aengus Ó Snodaigh asked the Minister for Finance his plans to organise the stakeholder forum to discuss how to maximise the benefits of the Section 481 credit for all concerned stakeholders and facilitate discussion of relevant issues, as recommended in the Budgetary Oversight Committee Report on the Section 481 Film Tax Credit; when he expects this forum will take place; and if he will make a statement on the matter. [43785/23]

Written answers

Minister for Finance

Section 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.

I am aware of the contents of the Committee on Budgetary Oversight’s Report on Section 481 Film Tax Credit. I am also aware that there are a number of recommendations contained within the report that cover a number of themes and policy areas for which responsibility lies with other Departments.

In relation to Recommendation 14, I understand that the Department of Tourism, Culture, Arts, Gaeltacht, Sport and Media (DTCAGSM) are examining the options available regarding the recommendation in the Committee on Budgetary Oversight’s Report on Section 481 (Film Tax Relief) for the convening of a stakeholder forum.

Further engagement between my Department and DTCAGSM is ongoing in respect of the BOC's recommendations. I would also note that my officials have directly engaged with all relevant representative bodies in the sector, including those representing crew, cast and producers, with a view to understanding the issues affecting the audio-visual sector.

Insurance Industry

Questions (116)

Matt Shanahan

Question:

116. Deputy Matt Shanahan asked the Minister for Finance the steps she and her Department are taking to pressure insurance companies to pass on savings, following the publication of an article (details supplied) outlining how the implementation of judicial guidelines has caused a slump in the number of personal injury cases being taken to the courts; if she will consider supporting a windfall tax gain on insurance companies that are failing to pass on considerable savings; and if he will make a statement on the matter. [43836/23]

Written answers

Minister for Finance

As the Deputy will appreciate, neither I, nor the Central Bank of Ireland, can direct the pricing or provision of insurance products. This position is reinforced by the EU Single Market framework for insurance (the Solvency II Directive).

Notwithstanding this, reforming the insurance sector is a key policy objective for the Government. Through the comprehensive Action Plan for Insurance Reform, targeted measures have been delivered across a broad spectrum of policy areas, with the aim of reducing costs and increasing availability of cover.

The Personal Injuries Guidelines represent a key pillar of this reform agenda, and have significantly lowered award levels. According to data from the Personal Injuries Assessment Board (PIAB) for the first six months of 2022, award levels were down on average nearly 40 per cent under the Guidelines. Moreover, since their introduction there has been a year-on-year reduction in the volumes of claims coming to PIAB, with applications falling from 26,009 in 2020 to 8,889 for H1 2022.

In this regard, I welcome the recent findings, as referenced by the Deputy, that the number of personal injury cases before the courts has also been trending downwards. According to the Court Service Annual Report for 2022, there has been “a significant reduction in the number of new personal injury actions commencing in the High Court and the Circuit Court” since the adoption of the Guidelines, while the value of those awards has also reduced. Together with the findings from PIAB, I believe this is further proof that the Guidelines are taking hold and becoming embedded in the system.

It is important to note that the full impact of the Guidelines may take time to affect price levels, due to uncertainty from ongoing legal challenges. Nevertheless, the Government’s focus is now firmly on ensuring that the savings generated by the entire reform programme are realised, for the benefit of consumers, businesses, and community and voluntary groups. In this regard, Minister of State Carroll MacNeill will be meeting with the CEOs of the main insurers here again in the coming weeks, in order to reiterate the Government’s expectation that insurers will reduce prices, and increase their risk appetite, in light of this improved operating environment.

With respect to the question of a windfall tax gain, I would be very cautious about any such measure, as I believe there is a risk that it would be passed directly onto customers, rather than acting as an incentive for insurers to reduce premiums. Furthermore, such a proposal may in fact be counterproductive in terms of increasing competition, which is a key aim of the reform agenda, as evidenced by the creation of a dedicated Office to Promote Competition in the Insurance Market.

Chaired by Minister of State Carroll MacNeill, the Office is working closely with IDA Ireland, and new insurance providers have either established in Ireland or are in the process of doing so. It is vital that industry fully supports the reforms in order to maintain this momentum and generate increased insurance capacity, both from new and existing providers, for the benefit of customers.

Tax Reliefs

Questions (117)

Michael Creed

Question:

117. Deputy Michael Creed asked the Minister for Finance if he will review the level of pension contributions that qualify for the higher rate of tax relief introduced in 2014; if he accepts that the purchasing power of those impacted by this cap not changing since its introduction has been significantly reduced; and if he will make a statement on the matter. [43903/23]

Written answers

Minister for Finance

I understand that Deputy Creed is referring to the chargeable excess tax and Standard Fund Threshold (SFT) regime.

I am advised by Revenue that the SFT was introduced in Finance Act 2005, with the purpose of addressing excessive pension accrual, and it applies to all private and public sector pension arrangements. It is provided for in Chapter 2C of Part 30 of the Taxes Consolidation Act 1997 (TCA) which sets out the maximum tax-relieved pension fund at retirement. If the relevant threshold is exceeded, the excess over the threshold (the “chargeable excess”) is subject to an upfront, ring-fenced income tax charge (known as “chargeable excess tax”) at 40%.

The SFT was initially set at €5 million. The legislation allowed the Minister for Finance to amend the SFT in line with an “earnings adjustment factor”, which has happened on two occasions. The SFT was reduced to €2.3 million in December 2010 as part of a package of measures to deliver significant savings in the broad pension area following agreement reached with the EU/IMF.

The SFT was further reduced in Finance Act 2013 to €2 million, with effect from 1 January 2014, as part of reforms introduced to make supplementary pension provision more sustainable and equitable over the long term. The primary purpose of these changes was to further restrict the capacity of higher earners to fund or accrue large pensions through tax-subsidised sources.

It is not the case that increases in the CPI or other measures of purchasing power should necessarily automatically result in an increase to the SFT. However, as with all taxes, the tax treatment of supplementary pensions, including the SFT, is kept under ongoing review.

Question No. 118 answered with Question No. 105.

Customs and Excise

Questions (119)

Brendan Smith

Question:

119. Deputy Brendan Smith asked the Minister for Finance his views on the current effectiveness of the minimum excise duty trigger price applicable to tobacco products; the proposals, if any, there are to change this price; and if he will make a statement on the matter. [43915/23]

Written answers

Minister for Finance

The Minimum Excise Duty (MED) supports public health objectives by ensuring that the cheapest cigarettes on the market are priced at a particular minimum level, which reflects their underlying health risks.

The MED was increased in Budget 2019, Budget 2020 and Budget 2021, alongside VAT inclusive 50 cent increases on 20 pack cigarettes in the most popular price category (MPPC). The MED is currently set at €452.52 per 1,000, which equates to a total excise duty amount of €9.05 per 20 pack. This equates to a retail price ‘trigger point’ of €11.50 per 20 pack once the MED is applied (i.e. a 20 pack costing less than €11.50 would be taxed as if it were priced at €11.50).

The increase in the MED since 2018 has been significant and recent Budget increases in the MPPC have ensured that the lowest priced cigarettes currently on the market are priced at €13.30.

Ireland is committed to a policy of high taxation of tobacco in order to encourage people to quit smoking, particularly younger people and this policy is working. In 2007, 29% of the population were daily smokers. By contrast, the Healthy Ireland survey figures for 2022 show that that figure has fallen to 14%.

In relation to proposals to change the minimum excise duty trigger price, the Deputy will be aware that 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 a Budget decision.

Question No. 120 answered with Question No. 114.

Question No. 121 answered with Question No. 109.

Tax Code

Questions (122, 123)

Fergus O'Dowd

Question:

122. Deputy Fergus O'Dowd asked the Minister for Finance to consider proposals (details supplied) in respect of exit tax applicable to life insurance investment arrangements; and if he will make a statement on the matter. [43945/23]

Ged Nash

Question:

123. Deputy Ged Nash asked the Minister for Finance if he is reviewing the position as regards the exit tax applicable to life insurance investment arrangements in the context of the forthcoming Finance Bill; his views on a matter (details supplied); and if he will make a statement on the matter. [43970/23]

Written answers

Minister for Finance

I propose to take Questions Nos. 122 and 123 together.

As the Deputies are aware Life Assurance Exit Tax (LAET) is payable on the gain made on a life assurance policy. The Finance Act 2000 introduced the gross roll up taxation regime for life assurance policies. The general rule for an investment subject to a gross roll up scheme is that no annual tax is applied to the income or capital gains arising. Instead, exit tax is required to be deducted on the occurrence of a “chargeable event”. The Finance Act 2006 introduced a new chargeable event. This provided that a disposal is deemed to occur on the ending of an 8 year period beginning from the creation of the investment undertaking and then each subsequent 8 years. This means that any growth in the life assurance policy is not subject to an annual tax, instead a chargeable event arises every 8 years. LAET is payable on any gain in value at the date of the chargeable event.

LAET is being considered by the Department as part of the wider review currently being carried out on Ireland’s funds sector. I published the Terms of Reference for a Review of the Funds Sector in Ireland ("Funds Sector 2030: A Framework for Open, Resilient & Developing Markets") on 6 April 2023. As per the Terms of Reference, and following on from the recommendation of the Commission on Taxation and Welfare, the Funds Review will examine, inter alia, the taxation regime for funds, life assurance policies and other related investment products.

A public consultation, launched as part of the Funds Review, closed on 15 September 2023. The Funds Review Team are now reviewing and analysing the submissions received and will continue to engage with stakeholders to explore issues raised in responses.

The Review Team will report to me in Summer 2024 and I look forward to considering its findings. It would not be appropriate to speculate on the outcome of the review in advance of its completion.

Question No. 123 answered with Question No. 122.

Question No. 124 answered with Question No. 114.

Question No. 125 answered with Question No. 114.

Tax Reliefs

Questions (126)

Danny Healy-Rae

Question:

126. Deputy Danny Healy-Rae asked the Minister for Finance for an update on a matter (details supplied) in relation to long-term rental; and if he will make a statement on the matter. [43977/23]

Written answers

Minister for Finance

The Rent a Room scheme was introduced in Finance Act 2001 as an incentive to encourage individuals to let rooms in their principal private residence as residential accommodation in order to bring about an increase in the availability of rental accommodation.

In accordance with section 216A of the Taxes Consolidation Act 1997, an individual who lets a room or rooms in her or his sole or main residence as residential accommodation may be exempt from income tax, PRSI and USC in respect of income from the letting where the aggregate of the gross rents and any sums for meals or other services supplied with the letting does not exceed the threshold for the year in question, which is €14,000 for 2023. Although the relief applies automatically, the amount of exempt rental income must be included in the individual’s tax return for the year in question.

It is also important to note that a wide array of tax reliefs and exemptions are already available for landlords and the property sector. The combined cost of these, in tax receipts forgone, is significant. For landlords subject to income tax, the current position is that, after the deduction of allowable expenses, rental income is subject to tax as part of the total taxable income of the landlord. Individual landlords may therefore be subject to income tax at their marginal rate of tax in addition to which USC and PRSI will also apply.

As the Deputy will appreciate, decisions regarding tax incentives and reliefs are normally made in the context of the annual Budget and Finance Bill process. Such decisions must have regard to the sound management of the public finances and my Department's Tax Expenditure Guidelines. These guidelines make clear that any policy proposal which involves tax expenditures should only occur in limited circumstances where there are demonstrable market failures, where a tax-based incentive is more efficient than a direct expenditure intervention.

Furthermore, it is a longstanding practice of the Minister for Finance not to comment, in advance of the Budget, on any matters that might be the subject of Budget decisions.

Tax Collection

Questions (127, 129)

Steven Matthews

Question:

127. Deputy Steven Matthews asked the Minister for Finance if his Department maintains an updated list of the number of vacant units deemed ineligible for the vacant homes tax as they are uninhabitable; and if he will make a statement on the matter. [43981/23]

Steven Matthews

Question:

129. Deputy Steven Matthews asked the Minister for Finance if his Department maintains an updated list of the number of structures deemed ineligible for local property tax as they are uninhabitable; and if he will make a statement on the matter. [43995/23]

Written answers

Minister for Finance

I propose to take Questions Nos. 127 and 129 together.

As the Deputy is aware, Vacant Homes Tax (VHT) is a new measure announced in Budget 2023 which aims to increase the supply of homes for rent or purchase to meet demand. As is the case for the Local Property Tax (LPT), VHT will not apply to derelict or uninhabitable properties. The definition of residential property for VHT is the same as the definition for LPT which is set out in Section 2A of the Finance (Local Property Tax) Act 2012 (as amended) and essentially means any building which is in use as, or is suitable for use as, a dwelling.

Therefore, LPT and VHT only apply to habitable residential properties. Property owners are required to self-assess their property’s liability to LPT and (if applicable) VHT. Where a property is uninhabitable to such an extent that it is not suitable for occupation it is outside the scope of both taxes and is not taxable. In such circumstances, there is no requirement on the property owner to file an LPT or VHT return.

Tax Code

Questions (128)

Thomas Pringle

Question:

128. Deputy Thomas Pringle asked the Minister for Finance his views on a taxation matter (details supplied); and if he will make a statement on the matter. [43983/23]

Written answers

Minister for Finance

The 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 of Income Tax and Deposit Interest Retention Tax (DIRT) paid in Ireland over the previous four years, subject to limits outlined in the legislation. Section 477C of Taxes Consolidation Act 1997 (TCA) outlines the definitions and conditions that apply to the HTB scheme.

Taxpayers can apply for the HTB scheme if they are either, a first-time purchaser of a qualifying residence or a first-time purchaser in relation to a self-build qualifying residence. The applicant is required to confirm their eligibility as set out in the legislation during the application process.

Section 477C(1) TCA 1997 defines a self-build qualifying residence as a qualifying residence which is built, directly or indirectly, by a first-time purchaser on his or her own behalf. I am advised by Revenue that the person concerned made a claim for relief based on the property being a self-build qualifying residence. Following a review of the claim, Revenue has determined that the person does not qualify for the relief as the property does not meet the criteria of a self-build qualifying residence as set out in Section 477(1).

Question No. 129 answered with Question No. 127.

Customs and Excise

Questions (130, 132)

Carol Nolan

Question:

130. Deputy Carol Nolan asked the Minister for Finance if he will make a commitment that there will be no change to the excise duty applied to agri-diesel due to low road usage of farm machinery and no viable alternative for use in farm machinery; and if he will make a statement on the matter. [44027/23]

Carol Nolan

Question:

132. Deputy Carol Nolan asked the Minister for Finance if there will be a suspension of LPG carbon tax for 2023 and 2024 for farmers and agri-contractors (details supplied); and if he will make a statement on the matter. [44029/23]

Written answers

Minister for Finance

I propose to take Questions Nos. 130 and 132 together.

As the Deputy will be aware, it is a longstanding practice of the Minister for Finance not to comment, in advance of the Budget, on any tax matters that might be the subject of Budget decisions.

Tax Code

Questions (131)

Carol Nolan

Question:

131. Deputy Carol Nolan asked the Minister for Finance if he will retain section 664A of the Taxes Consolidation Act 1997 and extend it to include agricultural contractors to mitigate the increased cost of production; and if he will make a statement on the matter. [44028/23]

Written answers

Minister for Finance

Section 664A Taxes Consolidation Act 1997 (TCA) provides additional relief for farmers in respect of an increase in the carbon tax on farm diesel. In addition to being able to claim a tax deduction for expenditure incurred on farm diesel (including any carbon tax charged in respect of the diesel), in computing their taxable farming profits, farmers may claim a further deduction for farm diesel in an amount equal to the difference between the carbon tax charged and the carbon tax that would have been charged had it been calculated at the rate of €41.30 per 1,000 litres of farm diesel (the 2012 baseline).

Decisions regarding tax incentives and reliefs, whether in respect of the introduction of new measures or the amendment of existing measures, are normally made in the context of the Budget and Finance Bill process. Such decisions must have regard to the sound management of the public finances and my Department's Tax Expenditure Guidelines.

As the Deputy will be appreciate, it is a longstanding practice of the Minister for Finance not to comment in advance of the Budget on any tax matters which might be the subject of Budget decisions.