Dáil Éireann Debate, Thursday - 10 May 2012
50 Deputy Kevin Humphreys asked the Minister for Finance his position on the proposal from the EU Council, COM (2001) 714 for a common system of taxation applicable to interest and royalty payments made between associated companies of different member States; the impact this would have here; and if he will make a statement on the matter. [23405/12]
Amharc ar fhreagraThe Deputy is referring to a proposal from the European Commission to amend Council Directive 2003/49/EC of 3 June 2003 under which interest and royalty payments made between associated companies of different Member States are exempt from withholding taxes and other taxes in the source Member State. The purpose of the Council Directive is to prevent double taxation by ensuring that such payments will only be taxed in the Member State in which the beneficial recipient of the interest or royalty payment is resident. The Commission proposal would broaden the scope of the Directive by lowering the shareholding threshold, from 25% to 10%, for qualification as an associated company, while providing that the requirement to exempt interest and royalty payments from taxation in the source Member State only applies where the payments are subject to tax in the Member State of residence of the recipient company.
Discussions on the Commission proposal under the Danish Presidency are ongoing and Ireland's position is that, while agreement has yet to be reached in relation to the draft text of the amendments proposed, we are supportive, in principle, of the proposal as it would generally be of benefit to Irish-based companies with associated companies in other Member States.
51 Deputy Clare Daly asked the Minister for Finance the amount of revenue collected under the car-parking levy brought in under the 2008 Finance Act, and the number of workers levied. [23425/12]
Amharc ar fhreagraIn Finance (No. 2) Act 2008, the previous Government facilitated the introduction of a car parking levy in urban areas. The enabling of the measure would require a Ministerial Order. Such an Order has not been made to date and consequently there has been no revenue collected nor any employees levied.
52 Deputy Stephen S. Donnelly asked the Minister for Finance further to Parliamentary Question Nos. 198 and 199 of 1 May 2012, if he will confirm that he does not have estimates for the budgetary impact of meeting the structural deficit targets which are a key component of the Fiscal Compact Treaty; and if he will make a statement on the matter. [23480/12]
Amharc ar fhreagraIn my replies to earlier questions, I have stressed that our commitment is to get the deficit below 3 per cent of GDP by 2015. In terms of the structural deficit, addressing this does not necessarily involve taxation and expenditure adjustments. For instance, the ambitious programme of micro-economic reforms that is already underway is expected to help reduce the structural element of the deficit by the middle part of the decade. One example is in the programme of labour market reform, where the Action Plan for Jobs 2012 and the Pathways to Work initiative include reforms aimed at addressing some of the skills mismatch in the labour market, which should help lower the unemployment rate. This, in turn, would have a structurally beneficial impact on the public finances, on both the revenue and expenditure sides. These and other factors make estimates of the budgetary impact of meeting our medium term objective subject to a high degree of uncertainty.
53 Deputy Stephen S. Donnelly asked the Minister for Finance further to Parliamentary Question No. 202 of 2 May 2012, if he will provide the detail backing up the decision to apply a debt to GDP ratio of 60% for example, economic papers, quantitative analysis, empirical evidence; and if he will make a statement on the matter. [23481/12]
Amharc ar fhreagraAs I stated in my previous reply the decision to apply the debt-to-GDP ratio of 60% in the Intergovernmental Treaty is to ensure consistency with the debt provision of the Stability and Growth Pact. Indeed, the 60% debt reference value has been around for some time. The debt and deficit limits contained in the Pact are designed to prevent spill-over effects from fiscal policies in participating Member States. Furthermore there is ample empirical evidence to confirm that relatively high levels of public debt can constrain economic activity through, for instance, crowding out of private sector investment and reducing confidence.
