Written Answers Nos. 132-149
132. Deputy Maureen O'Sullivan asked the Tánaiste and Minister for Foreign Affairs and Trade his views on the decision of the Syrian opposition coalition to boycott international meetings due to of lack of effective action by the international community; if he will address this matter when he meets Syrian national coalition president Mr Khatib; and if he will make a statement on the matter. [11032/13]
Amharc ar fhreagraI understand that the initial decision by the Syrian National Coalition not to participate in a meeting of the core group of the Friends of Syria in Rome on 28 February was later reversed and that the SNC President, Dr Al Khatib, and other SNC representatives participated fully in the Rome meeting. I am glad that Dr. Al Khatib and his colleagues ultimately chose to maintain their close engagement with the international community in support of concerted efforts to achieve the vital goal of a peaceful political solution to the Syrian crisis. The Foreign Affairs Council on 18 February, which I attended, made clear the EU’s continuing strong support for the Coalition. It also reaffirmed, at Ireland’s suggestion, its invitation to the Coalition to work even more closely with the joint UN/Arab League mission of Special Envoy Brahimi in charting a peaceful way out of the current conflict.
I also welcome Dr Al Khatib’s recent indication of readiness to enter into dialogue with the Syrian regime. I hope that this may prove to be a catalyst in achieving the beginning of a genuine political process and political transition within Syria. Deputies will be aware that I have formally invited Dr. Al Khatib to travel to Dublin at a mutually convenient time to discuss the Coalition’s vision for a new, post-Assad Syria. Our Embassy in Cairo continues to be in contact with Dr. Al Khatib and the SNC, including in relation to identifying a suitable opportunity for him to travel to Ireland.
133. Deputy Finian McGrath asked the Tánaiste and Minister for Foreign Affairs and Trade the position regarding developing relationships with Cuba in 2013 particularly in relation to trade and tourism. [11120/13]
Amharc ar fhreagraIreland and Cuba established diplomatic relations in 1999, and bilateral engagement has increased steadily in the period since then. Last year bilateral trade in goods with Cuba reached close to €1.2 million, making Cuba Ireland’s 155th largest trading partner. I understand that a small number of Irish people are exploring business opportunities in Cuba and that several thousand Irish tourists visit Cuba each year. I hope to see trade, investment and tourism links between our two countries increase in the period ahead.
We also engage in activity in other areas with a view to enhancing our bilateral engagement. The Irish Embassy in Mexico City, which is accredited on a concurrent basis to Cuba, has organised in recent years an Irish cultural week. This will be continued in 2013 also and will comprise, it is envisaged, a film series, a literary seminar in cooperation with the University of Havana, and musical events. In addition, the Embassy participates in a number of other events, including Celtfest Cuba, a festival of Celtic music and dance. There have also been developments at the level of the EU’s relations with Cuba. In November 2012, the Foreign Affairs Council agreed that the process of elaborating negotiating directives for a bilateral agreement with Cuba will begin within the framework of the EU’s Common Position.
134. Deputy Michael Healy-Rae asked the Tánaiste and Minister for Foreign Affairs and Trade the number of appointments he has made from March 2011 to January 2013 to State boards; in the case of each appointment, the number of appointments that were made to members of the general public who submitted a curriculum vitae for the appointment; the number of direct appointments he made; and if he will make a statement on the matter. [11476/13]
Amharc ar fhreagraThere are no State Boards operating under the aegis of my Department.
135. Deputy Patrick Nulty asked the Minister for Finance the steps that he has taken to implement the recommendations of the Moriarty tribunal since its publication nearly two years ago; and if he will make a statement on the matter. [11039/13]
Amharc ar fhreagraIn response to the Deputy’s question I have considered the provision of tax relief for donations to political parties and have decided against introducing such relief. The Electoral (Amendment) (Political Funding) Act 2012 provided for changes to the Electoral Act, 1997 and imposed new limits for donations. Donations to individuals exceeding €600 must be declared and donations exceeding €1,000 in any one year may not be accepted. Political party donations greater than €1,500 must be declared and donations greater than €2,500 in any one year may not be accepted. These limits, in themselves, should act to deter any attempts by wealthy individuals to influence political activity. The Office of the Revenue Commissioners have provided me with the following information in relation to Revenue issues raised in the recommendations of the Moriarty Tribunal.
Recommendation: Independence of the Revenue Commissioners
Section 101 of the Minister and Secretaries (Amendment) Act 2011 has placed on a statutory basis the independence of the Revenue Commissioners in the exercise by the Commissioners of their statutory functions under the various taxation and customs enactments. This has given effect to the recommendation of the Report of the Tribunal into Payments to Politicians and Related Matters (that is, the report of Mr. Justice Moriarty), that the principle or convention of the independence of the Revenue Commissioners be placed on the more robust status of a legislative provision.
Recommendation: Representations to Revenue by Office holders
In relation to this proposal I as Minister for Finance remain of the view that this recommendation could best be considered in the context of the Government’s overall approach to political and parliamentary reform. Representations are a valid part of the political process. The Government may wish to consider whether this recommendation should be confined to Revenue, or to Office holders, or whether the Commissioners decision to publish data on the volume of representations made by each Deputy is an adequate response.
Recommendation: Transmission to other agencies of information obtained by Revenue under bilateral agreements.
This recommendation has been considered. These agreements are important for Irish business, for the transparency of the Irish taxation system, and for tax administration in relation to businesses and individuals which operate across 2 or more jurisdictions. Ireland’s bilateral agreements comprise double taxation conventions and tax information exchange agreements. (TIEAs) Ireland’s agreements are based on OECD models which are considered to be best practice and which do not provide for such a protocol. While they provide for various forms of information exchange, they contain a very strong taxpayer confidentiality provisions, and restrict the use of the information to tax assessment and collection purposes.
Expanding Ireland's Tax Treaty and TIEA Network has been a strategic objective which Revenue has successfully pursued and such agreements can only be made if the other State agrees. If opportunities arise in the future, the Commissioners will consider the matter further.
136. Deputy Terence Flanagan asked the Minister for Finance if those in social housing will be liable for paying the property tax; and if he will make a statement on the matter. [11158/13]
Amharc ar fhreagraI am informed by the Revenue Commissioners that a person living in social housing, who is not residing there on foot of a long-term lease or an exclusive right of residence, will not be liable for the charge to LPT and that the liability will fall on the owner of the residential property, which, in the circumstances described by the Deputy would generally be a local authority or a housing association. I am also informed that the Revenue Commissioners are currently liaising with the social housing sector to establish how local authorities and individual housing bodies will provide the Revenue Commissioners with information in relation to their LPT liability and the timing and manner of the payment of this liability.
137. Deputy Billy Kelleher asked the Minister for Finance if his Department is planning a consumer awareness media campaign to tackle illegal selling as part of its tobacco policy review; and if he will make a statement on the matter. [11179/13]
Amharc ar fhreagraThis is a matter that comes primarily within the remit of the Revenue Commissioners who are responsible for tackling the illicit trade in cigarettes and tobacco products. I am aware that Revenue attaches a high priority to combating tobacco smuggling and the illegal sale of tobacco products and has adopted a comprehensive strategy, underpinned by annual action plans, in this regard. Revenue’s Strategy on Combating the Illicit Tobacco Trade (2011-2013), is published on www.revenue.ie.
A key action under the 2011-2013 Strategy is, in partnership with other Government agencies, to focus on reducing demand for contraband tobacco through educating the public on the negative aspects of contraband i.e. tax loss, criminality and health risks. Revenue optimises media coverage for prosecutions, significant seizures and enforcement activities. Where large seizures are made, Revenue takes the opportunity to encourage members of the public to provide information to Revenue on the sale of illicit tobacco products.
The confidential free phone tobacco smuggling number operated by Revenue is promoted through its website. The phone number is included in press releases relating to cigarette and tobacco seizures and is also promoted by Revenue in radio and television interviews concerning the illicit tobacco trade and on relevant trade websites and in trade publications. Revenue is happy to accept the assistance of the public through the provision of information in the fight against the illicit tobacco trade.
138. Deputy Terence Flanagan asked the Minister for Finance if houses built for wheelchair users will be exempt from the local property tax (details supplied); and if he will make a statement on the matter. [11497/13]
Amharc ar fhreagraI am informed by the Revenue Commissioners that it is not possible to give a definitive reply based on the information provided by the Deputy. While there is no specific exemption from the Local Property Tax (LPT) for houses built for wheelchair users, the Finance (Local Property Tax) (Amendment) Bill 2013 contains certain provisions that, if enacted, may be relevant, depending on the circumstances involved. Section 2 of the Bill provides an exemption from LPT for a residential property purchased, built or adapted to make it suitable for occupation by a permanently and totally incapacitated individual as their sole or main residence, where an award has been made by the Personal Injuries Assessment Board or a court, or where a trust has been established, specifically for the benefit of such individuals. In the case of adaptations to a property, the exemption will only apply where the cost of the adaptations exceeds 25% of the market value of the property before it is adapted. The exemption ends if the property is sold and the incapacitated individual no longer occupies it as his or her sole or main residence.
Alternatively, section 6 of the Bill provides for a reduction in the market value of a residential property that has been adapted for occupation by a disabled person where the adaptation has been grant-aided by a local authority. The reduction is limited to the lesser of the market value attributable to the adaptation work carried out on the property and the maximum grant payable under the relevant local authority scheme. The relief ends on the sale or transfer of a property that has been adapted, unless the person with the disability continues to reside in the property. Furthermore, the impact of specific adaptations on a property can be to decrease the value which may in turn impact on the LPT liability. I am advised by the Revenue Commissioners that full details of the all the existing exemptions are available on Revenue’s website www.revenue.ie, where the Commissioners have recently published a useful Guide to Local Property Tax. This will be revised shortly to take account of the provisions of the Finance (Local Property Tax) (Amendment) Bill 2013.
139. Deputy Finian McGrath asked the Minister for Finance his plans to tackle counterfeit fuel and tobacco sales; and if he will make a statement on the matter. [11687/13]
Amharc ar fhreagraI am informed by the Revenue Commissioners, who are responsible for collecting tobacco products tax and mineral oil tax and for tackling the illicit trade in tobacco and oil products, that they are conscious of the threat that this criminal activity poses to legitimate businesses and to the Exchequer. Combating this criminality is, therefore, a key priority for them. Revenue employs a multi-faceted strategy to detect and intercept illicit tobacco products, at point of importation and within the country, and to identify and prosecute those involved in the illegal trade. Considerable success has been achieved in this work, with the seizure of 95.6 million cigarettes and 5,276 kilograms of tobacco during 2012. There were 132 convictions for tobacco smuggling or for the sale of illicit tobacco products in the course of the year.
The main form of criminality in the fuel sector is the laundering of marked gas oil and the sale of the laundered product as auto-fuel, and Revenue acts against this illegal activity at all stages of the fuel supply chain. 11 oil laundries were detected during 2012, and 199,000 litres of fuel were seized in the course of those operations. A further 914,000 litres of illicit fuel were seized, the greater part from retail outlets or in the course of delivery to such outlets. In addition, 57 retail outlets were closed during the year, for trading without a licence or for breach of licence conditions.
To facilitate enhanced control and supervision of the fuel supply chain, licensing requirements were introduced, from 1 October 2012, for persons dealing in marked fuels. As well as these licensing changes, a requirement is now in place for all fuel traders to make monthly returns to Revenue, electronically, of their fuel transactions. This will facilitate Revenue in detecting unusual or anomalous patterns of activity. Work is proceeding also, in close cooperation with Her Majesty’s Revenue and Customs, on obtaining an improved fuel marker.
The Revenue Commissioners will continue their extensive work against the illegal fuel and tobacco trades and, in addition to ongoing enforcement activities, will continue to develop innovative ways of combating those responsible for them. This work will continue to include cooperation with representatives of the legitimate trade. As part of this process, the Commissioners would be pleased to discuss areas of possible cooperation with RGDATA, and will invite them to join the Hidden Economy Monitoring Group – a forum for the exchange of views on measures to combat the hidden economy between the Revenue Commissioners, the Department of Social Protection (DSP), the Department of Jobs Enterprise and Innovation and the National Employment Rights Agency (NERA) and representative bodies of employers, unions and industry.
140. Deputy Patrick Nulty asked the Minister for Finance if the European Central Bank has made a profit from the sale of any Irish bonds; if so, the steps he is taking to ensure this money is given back to the Irish State; and if he will make a statement on the matter. [10935/13]
Amharc ar fhreagraA recent ECB statement published details in relation to their securities holdings acquired under the Securities Markets Programme (SMP). This reports nominal SMP Irish bond holdings of €14.2bn at 31 December 2012, valued by the ECB on an amortised cost basis at €13.6bn. However, a detailed breakdown of the particular bonds, and thus their coupons or maturity dates or the dates of acquisition has not been published by the ECB. It is therefore not possible to outline the interest which will accrue to the ECB in relation to these holdings. It is also not possible to outline the profits, if any, made by the ECB from the sale of any Irish Bonds in the past. The ECB cannot legally return profits on the Eurosystem’s holdings of a country’s securities acquired under the SMP to the government of the country concerned. Rather these profits are recycled to all national central banks via their capital contribution keys – these are normally then transferred to governments as part of the NCBs’ surplus income.
141. Deputy Jack Wall asked the Minister for Finance when a P21 form will be supplied to a person (details supplied) in County Kildare; and if he will make a statement on the matter. [10937/13]
Amharc ar fhreagraI have been advised by the Revenue Commissioners that P21s (PAYE Balancing Statements) for 2010 and 2011 issued to the person concerned on 28 February and 25 February 2013 respectively.
142. Deputy Finian McGrath asked the Minister for Finance the position regarding the redundancy terms for an Irish Bank Resolution Corporation staff member (details supplied). [11002/13]
Amharc ar fhreagraAs the Deputy is aware, the legislation surrounding liquidation ranks employees as preferential creditors in respect of certain amounts owing to them on a winding up, including accrued wages and salaries, holiday pay, sick pay, statutory redundancy, pensions contributions and claims for damages arising from accidents. There are standard rules which apply to the distribution of the assets of companies in liquidation and it would not be appropriate for me to interfere with these rules. However the State does intervene to ensure that statutory redundancy is available through the Social Insurance Fund and that arrears of pay, sick pay, holiday pay or pay in lieu of statutory notice (limited to EUR600 per week up to a maximum of eight weeks) are payable from the Insolvency Payments Scheme. The Minister for Social Protection will rank as a preferential creditor of IBRC in respect of any payments made to employees of IBRC from the Social Insurance Fund or the Insolvency Payments Scheme. Any action taken by the Minister which might divert the assets from IBRC creditors to employees could be challenged in the Courts.
The special liquidators were promptly in contact with staff on Thursday 7th February and, unlike in other liquidations, the majority of employees have now been re-hired by the special liquidators, for a minimum period of 3 months, to provide some level of assurance and to ensure an orderly wind-down of the business. In addition, some staff may, in time, be re-hired by NAMA or other purchasers of the assets. This should provide some reassurance to employees.
143. Deputy John Lyons asked the Minister for Finance if he will bring forward the date, by three or six months from January 2014, for the reduction in tax relief on pensions of more than €60,000 per annum; and if he will make a statement on the matter. [11033/13]
Amharc ar fhreagraIn Budget 2013, I announced that changes to the maximum allowable pension fund at retirement for tax purposes (the Standard Fund Threshold - SFT) and other possible changes to give effect to the commitment in the Programme for Government to cap taxpayers’ subsidies for pension schemes which deliver pension income of more than €60,000 will be put in place in 2014. The existing SFT regime is designed to cater for relatively small numbers of individuals. The current structure and operation of the regime, which applies across all pension arrangements in the private and public sectors, would not effectively or efficiently cope with an expected minimum ten-fold increase in the numbers of individuals who would be affected by the Budget decision. A number of significant and fundamental changes to the current SFT regime may be required in order to deliver on the decision announced in the Budget. Alternatives to the use of the SFT regime to deliver on the Government’s commitment will also be explored and consultations will be required with, among others, various Departments and this will take time. For these reasons, I am not in a position to accede to the request in the Deputy’s question.
144. Deputy Pearse Doherty asked the Minister for Finance if his attention has been drawn to the distress to mortgage holders at Irish Nationwide/Irish Bank Resolution Corporation whose mortgage was not processed as usual as a result of the liquidation of IBRC; if he will guarantee that these mortgage holders will not suffer financially, including through credit reputation, because of the delays; and the steps he will take to ensure that they can return to a monthly budgeting with confidence. [11074/13]
Amharc ar fhreagraI have been advised by the special liquidators that letters have been sent to all residential mortgage holders to notify them that normal mortgage payment services will resume in time for the next scheduled Mortgage Loan payment in March 2013. The letter also notifies the mortgage holders that they have until 30 April 2013 to make payment of the missed February 2013 payment that was not processed as normal as a result of the appointment of the Special Liquidators. The special liquidators have also indicated that the missed payment will be processed at no additional cost, penalty or expense to the mortgage holder provided payment is made by 30 April 2013.
145. Deputy Michael McGrath asked the Minister for Finance the impact of the budgetary and economic forecasts for 2013, in particular the impact on exports, of the sharp appreciation of the euro against sterling since the budget 2013 economic and fiscal outlook was published; and if he will make a statement on the matter. [11135/13]
Amharc ar fhreagraThe forecasts produced by my Department in early December, as part of the Budget 2013, anticipate further modest GDP growth this year. These forecasts were predicated on a number of technical assumptions, which were outlined at the time. Regarding the euro-sterling exchange rate, the technical assumption (which is a standard international approach) was that the rate would remain unchanged at levels which prevailed at the time, implying an average rate of stg £0.81 during 2013. However, since the beginning of the year there has been a marked appreciation of the euro against sterling, with the bilateral rate appreciating by approximately 6 per cent between the beginning of January and the end of February.
Exports to the UK represent about a fifth of total exports and therefore Irish exporters will naturally be sensitive to exchange rate developments. However, the substantial and continuing progress made in improving our competitiveness over recent years should provide some buffer in this regard. For example, the European Commission in its most recent forecast projects growth in wages of 0.3 per cent in Ireland and 2.7 per cent in the UK this year. That is not to downplay the significance of the euro-sterling bilateral rate, especially for the indigenous exporting sector, and I am conscious of this.
I would also point out that a large share of Irish consumer goods are sourced from the UK, so that the recent appreciation of the euro-sterling bilateral rate should help to protect real income by depressing import prices. Finally, I would highlight the fact that my Department will publish revised forecasts in April, taking into account all relevant information.
146. Deputy Damien English asked the Minister for Finance if his attention has been drawn to the fact that the recently published Retail Ireland submission to the Department of Health’s June 2012 consultation on the Your Health is Your Wealth public health framework which warns that ever higher taxation and proposals to introduce plain packaging of tobacco products would be a further boon to the illegitimate supply channel; if he agrees with the Retail Ireland position; if he has communicated any such concerns to the Department of Health; and if he will make a statement on the matter. [11200/13]
Amharc ar fhreagraThe requirements in relation to cigarette packaging are a matter for my colleague the Minister for Health, who has indicated that he is supportive of any international developments in relation to plain or standardised packaging for cigarettes. I am advised by the Revenue Commissioners that their view at this stage is that the introduction of plain or standardised packaging would be unlikely to have a significant impact on their action programmes for combating the illicit trade in cigarettes. All packs of cigarettes that are offered for sale in the State are required to carry a tax stamp containing a range of sophisticated security features designed to prevent counterfeiting; a new and more secure stamp was introduced last year. An examination of whether a pack of cigarettes carries a genuine tax stamp will, irrespective of the type of packaging, continue to be a key means for Revenue officials to distinguish between legal and illegal products.
147. Deputy Damien English asked the Minister for Finance further to Parliamentary Question No. 80 of 23 January 2013, if he will provide details of the persons who make up the hidden economy monitoring group; if he will elaborate on the areas of the hidden economy covered by the group's remit; if he will provide a detailed description of the group's work since its inception; and if he will make a statement on the matter. [11202/13]
Amharc ar fhreagraI am advised by the Revenue Commissioners that the Hidden Economy Monitoring Group (HEMG) was set up in 1990 at the request of the Central Review Committee of the Programme for National Recovery. Chaired by Revenue, it is a multilateral Group comprising of representatives of IBEC, SFA, CIF, ICTU and SIPTU, Government agencies, Department of Social Protection, Department of Jobs Enterprise and Innovation and the National Employment Rights Agency. Its terms of reference are:-
“To provide a forum for the exchange of views on the effectiveness of measures introduced in combating the hidden economy between the Revenue Commissioners, the Department of Social Protection (DSP), the Department of Jobs Enterprise and Innovation and the National Employment Rights Agency (NERA) and representative bodies of employers, unions and industry. The group is to prepare a brief report on its activities each year for presentation to the Department of an Taoiseach".
The group met 3/4 times a year between 1990 and 2011 and contributed to the establishment of multi-agency investigation units, producing a "Code of Practice for Determining Employment or Self-Employment Status of Individuals", and in 2007 sponsored legislation which provided for the exchange of employment information on the earned income of individuals between the Minister for Enterprise, Trade and Employment, the Minister for Social and Family Affairs and the Revenue Commissioners, the first steps into information exchange. The ‘Code of Practice’ has been used extensively by all of the above-mentioned Government Agencies to combat numerous cases of unregistered and misclassified workers since its introduction in December 2007.
Under its terms of reference, the Group prepares a written annual report that is presented to the Department of the Taoiseach. I am further advised by the Revenue Commissioners that in 2011 the Group reviewed its own effectiveness and ability to deliver, in accordance with its terms of reference, and reached the conclusion that its purpose would be better served by operating at a more local level, utilising resources more familiar with the difficulties that were being experienced by SMEs and unions locally and using local Government agency resources to arrive at workable solutions.
In November 2011, the full HEMG devolved its terms of reference to four regionally based Liaison Groups, namely the Border Midlands West, Dublin, East & South East and South West Hidden Economy Monitoring Liaison Groups, with a requirement that all groups meet regularly and provide reports as required to the HEMG. The constituent members of the Regional Liaison Groups nominated were locally based members of the original attendee representative bodies and agencies, with the meetings organised and chaired by Revenue officials. The four Regional Liaison Groups met a total of 11 times during 2012. The 2012 report of the HEMG is currently being prepared.
On 30 January 2013 the full HEMG met to review the effectiveness of the first year of operations of the Regional Liaison Groups and to see what supports could be put in place to achieve and sustain improved outcomes from the work of the Groups. In order to make the HEMG more representative it was expanded to include a number of other interested representative bodies such as ISME and Retail Ireland. A schedule of meetings was agreed that requires the full HEMG to meet twice, and the Regional Liaison Groups to meet quarterly, in 2013.
The Revenue Commissioners have advised that attendees at the HEMG meetings, in a representative capacity, varies from time to time, however the January 2013 meeting was chaired by Mr. Declan Rigney, Assistant Secretary, Office of the Revenue Commissioners and was attended by:
- The Revenue Planning Division team Mr. Séamas O’Cathasaigh, Mr. Sean Nolan, Mr. Vincent Kenrick and Mr. John Morrissey.
- The Chairs of the four Regional Liaison Groups (also Revenue), Ms. Phil Uí Bhróithe (Border/Midlands/West Region), Ms. Lynda Hendley (Dublin Region), Mr. Pat Murphy (South-West Region) and Mr. Thomas Keating (East/South/East Region).
- The other Government Agencies were, Mr. Phil Cox – Department of Social Protection, Mr. Fran Power – National Employment Rights Authority and Ms. Joan Kehoe – Department of Jobs Innovation and Enterprise.
- The Employee Group representatives (Unions) were Mr. Fergus Whelan – Irish Congress of Trade Unions and Mr. Christy McQuillan – Services Industrial Professional and Technical Union.
- The Employer Group representatives were, Mr. Ger Brady – Irish Business and Employers Confederation, Mr. Eddie Keenan – Construction Industry Federation, Ms. Liz Carroll – Irish Small and Medium Enterprises and Mr. Jim Copeland – Hardware Association of Ireland.
- Apologies were received from Ms. Avine McNally – Small Firms Association, Mr. Stephen Lynam – Retail Ireland, Mr. Donal O’Keefe – Licensed Vintners Association and Mr. Patrick Cribben – Vintners Association of Ireland.
In order to open up the Group’s deliberations to the fullest range of hidden economy activities, the membership has been enlarged over the years most recently, to include representatives from Retail Ireland and the licensed trade.
I am advised by the Revenue Commissioners that although the hidden economy is not defined within the Group’s terms of reference, no restrictions have been placed on the scope of hidden economy activities discussed within the HEMG and the Regional Liaison Groups. While the Group’s discussions during the last decade concentrated to a large degree on the construction sector, other issues discussed within the Group included employment rights, the problem of people “working and signing” as well as under-reporting of income by cash businesses. Another initiative that Revenue developed during 2011 for the HEMG was a reporting template which facilitates the provision of information by representative bodies relating to shadow economy activities being carried on in their respective sectors.
I am advised by the Revenue Commissioners that during the course of the January 2013 full meeting of the HEMG, and in a series of bi-laterals that Revenue held with a number of representative bodies prior to the full meeting, Revenue used the opportunity to remind relevant attendees about the reporting template, they also highlighted the type of information that is helpful to them in tackling the shadow economy and drew relevant Group members’ attention to the tobacco hotline that is run by Revenue.
I am satisfied that Revenue is taking a robust approach to tackling the Shadow Economy, and in defending legitimate traders, and I welcome their continuing productive engagement with other State Agencies and with the representative groups through the Hidden Economy Monitoring Group.
148. Deputy Gerry Adams asked the Minister for Finance if sums of damages paid in personal injuries cases on foot of an out of court settlement are liable for the payment of income tax or any other taxes; and if he will make a statement on the matter. [11214/13]
Amharc ar fhreagraIn the absence of sight of the documents pertaining to a case and, in particular, sight of the Statement of Claim and sight of the out of court settlement agreement, it is possible to reply only in general terms. Subject to this, in general, lump sums received as compensation for personal injuries are not liable to income tax. In addition Section 613(1)(c) of the Taxes Consolidation Act 1997 provides that any sum obtained by means of compensation or damages for any injury suffered by an individual in his or her person is not subject to capital gains tax. Section 82(1)(a) of the Capital Acquisitions Tax Consolidation Act 2003 similarly provides that the receipt by a person of compensation or damages for any injury suffered by that person are not subject to capital acquisitions tax. Finally, by way of further information, leaflet IT13, which is available on the Revenue Commissioners website at http://www.revenue.ie/en/tax/it/leaflets/it13.html, deals with the taxation of income or gains arising from the investment of personal injury compensation payments.
149. Deputy Seamus Healy asked the Minister for Finance the position regarding homes purchased under the local authority shared ownership schemes; if these homes are subject to the local property tax; if so, the person responsible for the payment of this tax; and if he will make a statement on the matter. [11272/13]
Amharc ar fhreagraThe Finance (Local Property Tax) Act 2012 sets out how the tax is to be administered and provides that a liability for Local Property Tax (LPT) will arise where a person owns a residential property on the liability date, which for 2013 will be 1 May 2013 and for subsequent years will be 1 November in the preceding year. Section 7 of the Act provides that local authorities will be liable to pay the LPT on their properties in the same way as any other residential property owner, unless the properties in question are used to accommodate people with special housing needs such as the elderly or people with disabilities. I am advised by the Revenue Commissioners that residential properties purchased under the various local authority shared ownership schemes will also be subject to LPT, and in these cases, the individual(s) who purchased the residential property from the local authority will be liable to pay the tax.
150. Deputy Seamus Healy asked the Minister for Finance if returns arising from the investments in the ten year national solidarity bond issued under the national instalment savings scheme will be subject to deductions for PRSI and/or universal social charge; and if he will make a statement on the matter. [11275/13]
Amharc ar fhreagraThe National Solidarity Bonds consist of two elements. On maturity, the bonds attract a lump sum payment that does not form part of income as estimated in accordance with the Tax Acts and is, therefore, exempt from income tax and universal social charge and from the charge of PRSI. Annually, a payment of interest is made to the bondholder and deposit interest retention tax (DIRT) is deducted. Interest, which is liable to DIRT, is specifically excluded from the charge to universal social charge. However, PRSI may be chargeable on such interest depending on the circumstances of an individual.
In addition, I announced in my Budget speech last December that Minister Burton will be bringing forward legislation to change PRSI contributions as follows: where modified PRSI rate payers have income from a trade or profession, such income and any unearned income they have will be made subject to PRSI with effect from the 1st of January 2013; and unearned income for everyone else will become subject to PRSI in 2014. This means that PRSI will be payable on such income generated from wealth such as rental income, investment income, dividends and interest on deposits and savings.
Furthermore, I would point out that, in general, social insurance applies to persons over the age of 16 years and under pensionable age, which is currently age 66 years. Those aged 66 years and over are not liable to pay PRSI on any of their income including their unearned income. Accordingly those over 66 years will not be impacted by the proposal to apply PRSI to unearned income such as interest on savings, shares and rents.
151. Deputy James Bannon asked the Minister for Finance when a person (details supplied) in County Longford will be repaid moneys due in respect of RCT contractors tax for 2012; and if he will make a statement on the matter. [11294/13]
Amharc ar fhreagraI am advised by the Revenue Commissioners that, in the year 2012, Relevant Contracts Tax (RCT) of €28,730.27 was deducted from relevant payments made to the person in question and remitted to Revenue. As requested by his agent, a total of €23,332.47 of this has been offset against other liabilities, as follows:
- VAT liabilities of €7,167.00 for the year 2011;
- VAT liabilities of €5,951.60 for the year 2012;
- Income tax liabilities of €6,106.87 for the year 2011;
- Preliminary tax of €4,107.00 for the year 2012.
A balance of €5,397.80 in respect of RCT remains on the tax record of the person in question. Revenue may repay Relevant Contract Tax suffered, subject to restriction for any amounts of I.T., C.G.T., VAT, PAYE, Interest, or PRSI outstanding.
The final tax liability of the person in question can only be calculated upon receipt of his return of income for the year 2012. Therefore, Revenue is not in a position to determine if any of the remaining balance is for repayment until the 2012 final Income Tax liability of the person in question has been finalised following receipt of his 2012 Return. While Returns of Income for the 2012 tax year are not finally due until October 2013, Returns can be filed earlier than the final date for completion. Accordingly, if the person submits his return now, his tax position can be determined and if any refund is due, it will be processed without delay .
152. Deputy James Bannon asked the Minister for Finance the reason budget 2013 provided an excise rebate on diesel for haulage companies, but not for transport companies despite his belief that under law, assistance given to truck operators would also be given to coach operators; and if he will make a statement on the matter. [11305/13]
Amharc ar fhreagraThe proposal to introduce an auto-diesel excise duty relief for licensed road hauliers that I announced in the Budget was, initially, confined to licensed and tax compliant hauliers. However having received a number of submissions from, and on behalf of, private coach operators seeking to have this relief extended to them, as the Deputy will now be aware I have extended the relief to the licensed passenger transport sector in the context of the Finance Bill published on 13th February. The maximum amount of the relief will be 7.5 cents per litre and will be price dependent.
153. Deputy Robert Dowds asked the Minister for Finance his views on the need for greater transparency over the profits and taxation of banks as part of the implementation of the Basel III accord in the European Union, which is currently under discussion, in view of the recent experience here of what a lack of transparency in banking can lead to; and if he will make a statement on the matter. [11312/13]
Amharc ar fhreagraIreland generally supports greater transparency and has made significant efforts since the banking crisis to promote transparency and openness in the banking sector. As President of the Council of the EU, Ireland has worked with other Member States to provide in the Capital Requirements Directive and Regulation (CRD IV/CRR) for appropriate levels of transparency. The text provisionally agreed with the European Parliament on country by country reporting on profit or loss before tax and tax on profit or loss will be considered by Ecofin on Tuesday 5 March.
The CRD IV provisional agreement, subject to technical drafting and agreement at Ecofin, provides for immediate public reporting on the name and geographical location, number of employees per institution and turnover of each institution. Profit or loss before tax, tax on profit or loss and public subsidies received by systemically important institutions will be submitted on a confidential basis to the Commission from 6 months after the date of application of CRD.
The Commission, in consultation with the relevant European Supervisory Authorities, will assess the data received regarding potential negative economic consequences of disclosure of that data (e.g. competitiveness, investment and credit availability and financial stability) and submit a report on the basis of the data by 31 December 2014. If the report identifies significant negative effects, the Commission may propose to modify the reporting obligations. The Commission shall be empowered to adopt a delegated act to defer the disclosure obligation and will publicly declare that this is the case; otherwise there will be country by country reporting on Profit or loss before tax, tax on profit or loss and public subsidies received by financial institutions from 1 January 2015.
154. Deputy Robert Dowds asked the Minister for Finance in view of the manipulation of a double tax convention between Ireland and Zambia by Zambia Sugar to avoid paying withholding taxes in either jurisdiction, if he will consider following the example of the Netherlands and Denmark and reviewing all such tax treaties with developing countries to ensure they are fit for purpose, thereby preventing such manipulation. [11313/13]
Amharc ar fhreagra155. Deputy Robert Dowds asked the Minister for Finance if he follows certain clear principles when negotiating double tax treaties with developing countries; and if he will outline what those principles are. [11314/13]
Amharc ar fhreagra156. Deputy Robert Dowds asked the Minister for Finance his plans to introduce automatic sharing of information concerning the manipulation by companies for tax purposes of double tax agreements between Ireland and developing countries, as recommended by the OECD, and which could assist in protecting the tax base of both Ireland and the developing country. [11315/13]
Amharc ar fhreagraI propose to take Questions Nos. 154 to 156, inclusive, together.
I am advised by the Revenue Commissioners that in the normal course of updating and extending Ireland’s double taxation treaty base, the provisions of those treaties are regularly evaluated with a view to ensuring their adequacy from Ireland’s perspective but also from the point of view of treaty partner countries. While the other country’s perspective will always be fully set out in the course of negotiations, it is also necessary that the terms of Ireland’s new tax treaties should be mindful of the interests of, and acceptable to, existing treaty partners. Several treaties may be under re-negotiation at any one time, requiring a review of the existing provisions. While the Revenue Commissioners cannot comment in relation to any specific case, they have informed me that the Zambian tax authorities have not expressed any concerns in relation to the application of the treaty with Ireland.
An underlying principle of tax treaty negotiation with any country is to view the agreement as a vital piece of fiscal infrastructure that should have a positive effect on both jurisdictions concerned. In negotiating double taxation treaties, the Revenue Commissioners aim to reach a convergence of positions that will ensure that the treaty is effective and efficient, meets the interests of each side as far as possible, is acceptable in both countries and works well in practice.
All of Ireland’s double taxation agreements already contain provisions for the exchange, between the tax authorities, of information necessary to give effect to the agreements and to the domestic tax law of the contracting states. These provisions, which follow the OECD Model Convention, allow for information to be exchanged between treaty partners in three ways: on request (in relation to a particular case), spontaneously (where one State has acquired information which it thinks may be of interest to the other State), and automatically (where the information covers many cases of a similar kind which can be transmitted systematically on a regular basis).
Ireland is fully involved in, and supportive of, the discussions at OECD on the extensions to the automatic exchange of information for tax purposes. In addition, Ireland has signed up to the joint Council of Europe/OECD Convention on Mutual Administrative Assistance in Tax Matters. In response to a call from the G20 in 2009 “to make it easier for developing countries to secure the benefits of the new co-operative tax environment”, a Protocol was developed to amend this Convention to open it up to all countries. Ireland signed the Convention and the Protocol in June 2011.
157. Deputy Niall Collins asked the Minister for Finance when legislation will enable persons to withdraw up to 30% of their AVC contributions; and if he will make a statement on the matter. [11328/13]
Amharc ar fhreagraIn my Budget 2013 speech, I announced that I would make provision in Finance Bill 2013 for persons making Additional Voluntary Contributions (AVCs) used to supplement their main scheme retirement benefits to withdraw up to 30% of the value of those contributions. Any amounts withdrawn will be subject to tax at the individual’s marginal rate. The option will be available for 3 years from the passing of the 2013 Finance Bill which is expected to become law in early April at the latest. This is a restricted measure which will enable rather than incentivise certain individuals to access part of their pension savings beyond their regular or compulsory pension contributions. I do not wish to damage future pension provision and it is important that individuals continue to provide for their retirement. For these reasons, I have no plans to extend the measure beyond AVCs.
158. Deputy Pearse Doherty asked the Minister for Finance if he will provide the tender document issued by the special liquidator of Irish Bank Resolution Corporation for the provision of independent valuation services to value loans for sale. [11340/13]
Amharc ar fhreagraI have been advised by the special liquidators that the Request for Proposal (“RFP”) is confidential as it contains commercially sensitive material around the IBRC portfolio and around the independent valuation methodology against which bidders for loan assets will be bidding. The Special Liquidators have indicated that releasing information on the methodology may prejudice the ability of the Special Liquidators to obtain best value for the loan assets by providing information to bidders on these valuations.
