Dáil Éireann Debate, Tuesday - 7 April 2009
34 Deputy Aengus Ó Snodaigh asked the Minister for Finance his views on reducing the €250 donation threshold above which charities can claim tax back in an effort to address the shortfall in funding experienced by charities involved in overseas development. [14075/09]
Amharc ar fhreagraSection 848A of the Taxes Consolidation Act 1997 allows tax relief on donations made by either individuals or corporate bodies to eligible charities and other approved bodies, including first and second level schools and third level institutions. The minimum qualifying donation for relief purposes to an eligible charity or approved body is €250 per annum.
Reducing the threshold to allow tax relief on smaller donations, as the Deputy has proposed, could significantly increase the current cost of the scheme to the Exchequer. The relief is already very generous. There is no upper limit on the amount that can be donated generally and relief is granted at the donor's marginal rate of income tax. Donations can be cumulative, so that a donation of just €5 per week over the course of a year would qualify.
The donations scheme was one of the tax reliefs examined as part of the 2005 overall review of tax reliefs and exemptions. The review concluded that the €250 minimum threshold is serving its purpose and should be retained at its current level, subject to ongoing review. The Deputy may wish to note that the full text of the review can be found on my Department's website at www.finance.gov.ie/documents/publications/other/revtaxreliefsvol3.pdf.
The Commission on Taxation, as part of its remit, is reviewing all existing tax reliefs, including relief under section 848A. It is expected that the Commission will furnish its report to me at the end of July 2009.
