Deirdre Clune
Ceist:238 Ms Clune asked the Minister for Finance the reason a tax free allowance is available for blind persons yet is not available for those with other disabilities; and if he will make a statement on the matter. [12365/00]
Written Answers. - Tax Allowances.
As the Deputy will be aware, the only tax free allowance available for those with a specific disability is the blind person's allowance. This allowance was introduced in 1971 in recognition of the exceptional circumstances faced by visually impaired persons. Apart from the cost, which would be significant, extending this allowance to persons with other disabilities would raise the difficult issue of how to define disability.
However, there are a number of other tax-free allowances available for people with disabilities. These are: the incapacitated child's allowance; the dependant relative allowance; and, the allowance for employment of carer for an incapacitated person. In addition, there are a number of further tax measures from which disabled persons can benefit: Medical expenses relief – section 469 of the Taxes Consolidation Act, 1997 provides for tax relief in respect of various defined health expenses; covenants – unrestricted tax relief can be claimed on covenants in favour of permanently incapacitated minors other than from parents to their own minor incapacitated children. Unrestricted tax relief can be claimed on covenants in favour of permanently incapacitated adults; disabled drivers scheme – the scheme, details of which are set out in the Disabled Drivers and Disabled Passengers (Tax Concessions) Regulations, 1994, (S.I. No. 353 of 1994) provide valuable benefits to those severely and permanently disabled persons who qualify under its term. Under the scheme, a new car may be purchased every two years free of VAT and vehicle registration tax, subject to certain monetary limits. In addition, the annual road tax is not charged and the qualifying person is eligible for the provision per annum of 2,728 litres of road fuel free of excise duty; VAT relief – the VAT Act of 1972 provides for the application of a zero rate of VAT on a range of medical equipment and appliances e.g. hearing aids. Certain disabled persons may be entitled to a refund of VAT for certain equipment which is not zero rated under the VAT (Refund of Tax) Order (No. 15) 1981 (S.I. No. 428 of 1981); investment income – income arising from the investment of compensation payments made by the courts to those who are permanently incapacitated is free from income tax; and, land leases – there is a special exemption from income tax in respect of income derived from leases for incapacitated farmers.
As the Deputy will appreciate I receive numerous requests, many from very worthwhile causes, for the introduction of new reliefs or the extension of existing ones. Tax reliefs by their very nature reduce the tax base and make general reform of the tax system much more difficult. Government policy in recent years has been to reduce the burden of taxation to reward effort and to improve the incentive to take up employment. This has benefited all taxpayers.