Vol. 471 No. 1
99 Cecilia Keaveney asked the Minister for Finance if he will expand on the differences of interpretation which could be addressed in any renegotiation of the Irish-British Double Taxation Agreement, 1976; and if he will make a statement on the matter. [20197/96]
100 Cecilia Keaveney asked the Minister for Finance if he will clarify the scope of the current negotiations between the Inter-Departmental Committee and the Revenue Commissioners; whether, during these renegotiations, the moratorium will be extended until the actual situation is clarified; and if he will make a statement on the matter. [20198/96]
101 Cecilia Keaveney asked the Minister for Finance the classes of employment which are included and excluded under Article 18 of the Irish-British Double Taxation Agreement, 1976; and if he will make a statement on the matter. [20199/96]
112 Cecilia Keaveney asked the Minister for Finance whether current negotiations in relation to the Ireland/Britain Double Taxation Agreement, 1976, will target persons currently treated as exempt; and if he will make a statement on these negotiations. [20387/96]
I propose to take Questions Nos. 99, 100, 101 and 112 together.
As the Deputy is no doubt aware, last year I established an inter-departmental committee to thoroughly examine the whole issue involved in the taxation of cross-Border workers. Earlier this year the committee reported their findings which included a recommendation, since enacted, that cross-Border workers should be exempted from the 1.25 per cent health contribution levy and the 1 per cent employment and training levy. A further recommendation was that there should be consultation between the Irish and UK revenue authorities in order to clarify the scope of Article 18 of the Ireland/UK double taxation convention.
Article 18 is concerned with the taxation of governmental employees and it generally provides that they should be taxable only in the State of the government for which they work. In order to qualify under this article, the employee must be rendering services to the government or a local authority and must be discharging services of a governmental nature. In a High Court case in this State, it was held that a nurse employed in a hospital in Northern Ireland by a regional health board was not employed by a local authority, nor was the person discharging functions of a governmental nature. The rationale of this judgment would appear to be equally applicable to other similar type public service employments, such as teaching. Indeed the UK have taken the view that teachers employed by local education boards in Northern Ireland are not governed by Article 18.
Discussions have commenced between the Irish and UK tax authorities on the scope of Article 18 and whether it should be amended to make it clearer what categories of employment are covered. Those discussions are still taking place and it is hoped that they can be satisfactorily concluded shortly. However, it should be noted that Article 18 is intended to cover only a small class of government employees and the position of cross-Border workers generally will not be affected by the outcome of the negotiations. It is important also to add that the 1976 Irish/British Double Taxation Agreement is a bilateral one and any changes must be agreed to by the UK government.
