Terence Flanagan
Ceist:105. Deputy Terence Flanagan asked the Minister for Finance his views on the IMF remarks regarding broadening further the tax base; and if he will make a statement on the matter. [55013/13]
Amharc ar fhreagraTax Code
Ceisteanna (105)
Freagraí scríofa
I can advise the Deputy that there has been an ongoing and significant emphasis on base broadening through the abolition or curtailment of tax reliefs such as those relating to property investment and interest relief as well as increases in minimum tax rates for high earners. Indeed the Letter of Intent dated 29th November which was jointly sent by me and by Governor Honohan to Christine Lagarde, Managing Director of the IMF, Mario Draghi, President of the ECB, Jeroen Dijsselbloem, President of the EuroGroup, Olli Rehn, Commissioner for Economic and Monetary Affairs, and Rimantas Šadžius President of the EcoFin Council, refers specifically to such measures.
In addition to the curtailment of tax reliefs which are generally availed of by higher earners, the Deputy will be aware that the tax system has become more progressive since 2009, meaning that those on higher incomes pay proportionately higher rates of tax on their income than those on lower incomes.
I would also point out the introduction of specific base-broadening measures; examples of these would be the Local Property Tax and the Carbon Tax.
In the Medium-Term Economic Strategy the Government has stated its commitment to support economic growth by ensuring any tax increases be effected in the first instance by base broadening through the elimination or curtailment of overly-generous, poorly targeted or otherwise unaffordable tax reliefs.
Tax Collection Forecasts
Ceisteanna (106)
Kevin Humphreys
Ceist:106. Deputy Kevin Humphreys asked the Minister for Finance the projected cost of returning the standard rate cut off point to 2010 levels for single, married and so on reversing the changes from budget 2011; and if he will make a statement on the matter. [55023/13]
Amharc ar fhreagraFreagraí scríofa
I assume the Deputy’s question is confined to the reductions in the standard rate bands announced in Budget 2011. On this basis, I am informed by the Revenue Commissioners that the full year cost to the Exchequer, estimated by reference to 2014 incomes, of returning the standard rate tax bands to 2010 levels, for single and widowed persons, as well as for lone parents and for married couples would be of the order of €535 million. The figure is an estimate from the Revenue tax-forecasting model using latest actual data for the year 2011, adjusted as necessary for income and employment trends in the interim. It is, therefore, provisional and likely to be revised.
Tax Collection Forecasts
Ceisteanna (107)
Kevin Humphreys
Ceist:107. Deputy Kevin Humphreys asked the Minister for Finance the cost of returning personal income tax credits to 2010 levels reversing the changes from budget 2011; and if he will make a statement on the matter. [55024/13]
Amharc ar fhreagraFreagraí scríofa
I am advised by the Revenue Commissioners that the estimated full year cost to the Exchequer, estimated by reference to 2014 incomes, of returning the personal and PAYE tax credits to their 2010 levels for single and widowed persons, as well as for lone parents and for married couples/civil partners, would be of the order of €560 million. There would also be an additional full year cost of €30 million if the other secondary tax credits were also returned to their 2010 levels, such as homecarer tax credit, dependant relative tax credit, incapacitated child tax credit, blind persons credit, age credit and various additional tax credits for widowed persons.
These figures are estimates from the Revenue tax-forecasting model using actual data for the year 2011 adjusted as necessary for income and employment trends in the interim. They are therefore, provisional and likely to be revised.
Special Assignee Relief Programme
Ceisteanna (108)
Róisín Shortall
Ceist:108. Deputy Róisín Shortall asked the Minister for Finance the number of persons to date who have taken up the special assignee relief programme; the number of employers whose employees have taken up the programme; the amount of tax foregone to date as a result of this measure; the number of jobs he believes have been created under the programme; and if he will make a statement on the matter. [55065/13]
Amharc ar fhreagraFreagraí scríofa
Section 14 of Finance Act 2012 introduced the Special Assignee Relief Programme (SARP) which is designed to reduce the cost to employers of assigning key individuals in their companies from abroad to take up positions in the Irish based operations of their employer. Paragraph 10 of Section 14 provides that relevant employers must submit an annual return to the Revenue Commissioners detailing, inter alia, the number of employees and the amounts of exempt income claimed under the programme. The first year of the programme was 2012 and employer returns received to date for 2012 have provided the following results:
Numbers of employees availing of the scheme: 7
Numbers of employers with employees availing: 7
Amount of tax forgone: €60,600 (tax free income of 147,817 by 41% for 7 individuals only)
Numbers of employees for whom education fees were paid: none
Amount of education fees paid: € nil
Number of jobs created: 5
The 7 individuals qualifying for the relief received an aggregate total tax-free remuneration of €147,817 and the amount of tax forgone is estimated assuming the top rate of income tax rate of 41%.
Following a review of SARP claims it was identified that 3 claims did not satisfy the eligibility criteria and the relief was found to be not appropriate for 2012. The statistics have, therefore, been updated to exclude these claims, and this accounts for the decrease in some of the figures that were provided with previous information.
More limited details of further claims were also provided as follows in the Form 11 tax returns for 2012 filed under the self-assessment system in October/November of 2013.
Numbers of employees availing of the scheme: 8
Estimated amount of tax forgone: €63,600 (rounded to nearest €100), on the basis of tax free income of €154,720 at an assumed tax rate of 41%.
Other information such as numbers of employers associated with employees availing of the scheme, numbers of employees for whom education fees were paid and amount of education fees paid is not required to be provided by taxpayers in the Form 11 tax return and is therefore not available.
Pension Provisions
Ceisteanna (109)
Róisín Shortall
Ceist:109. Deputy Róisín Shortall asked the Minister for Finance further to his announcement in budget 2013 that persons making additional voluntary contributions used to supplement their main scheme retirement benefits would be permitted to withdraw up to 30% of the value of those contributions, the number of persons who have availed of this to date; the total value of funds withdrawn to date; and his estimate of the revenue generated from the measure. [55066/13]
Amharc ar fhreagraFreagraí scríofa
Finance Act 2013 provides members of occupational pension schemes with a three-year window of opportunity from 27 March 2013 during which they can opt to draw down, on a once off basis, up to 30% of the accumulated value of additional voluntary contributions (AVCs). This provision includes additional voluntary PRSA contributions made to AVC PRSAs. Administrators of AVC funds (including PRSA administrators) are required to provide, within 15 working days of the end of each quarter, commencing with the quarter ending on 30 June 2013, certain statistical information to the Revenue Commissioners in relation to AVC pre-retirement transfers or encashments made during each quarter. The budget estimate of expected yield in 2013 from this measure was €100 million.
The information that has been provided to Revenue to date for the quarters ending 30 June 2013 and 30 September 2013 is as follows:
- The number of transfers made: 7257
- The aggregate value of transfers made: €50.1 million
- The tax deducted from the aggregate value of the transfers made: €19.8 million
The corresponding details relating to the transfers/encashments made in the quarter ended 31 December are not required to be returned to Revenue until January 2014.
Credit Unions
Ceisteanna (110)
Martin Heydon
Ceist:110. Deputy Martin Heydon asked the Minister for Finance his views on a proposal relating to the Newbridge Credit Union building (details supplied); if he will give it his support; and if he will make a statement on the matter. [55088/13]
Amharc ar fhreagraFreagraí scríofa
Following an application by the Central Bank, Mr Jim Luby of McStay Luby Chartered Accountants, was appointed as liquidator of Newbridge Credit Union Limited by the High Court on 16 December 2013. It is expected that the freehold title of Newbridge Credit Union Limited’s premises will be sold to a third party in due course. The Central Bank has informed me that the liquidator is engaging with a potential purchaser of the Newbridge Credit Union premises and that all matters in relation to the sale of the premises will be dealt with by the liquidator. The future use of the premises will be a matter for the purchaser, irrespective of whether this is a State agency or a private purchaser.
Special Assignee Relief Programme
Ceisteanna (111)
Michael McGrath
Ceist:111. Deputy Michael McGrath asked the Minister for Finance the number of persons to date that have availed of the special assignee relief programme; the number of employers whose employees have availed of the programme; the amount of tax foregone as a result of the tax relief granted; the number of employees who have had education fees paid by their employer on a tax free basis under the programme; his views on the number of jobs that may have been created under the programme; and if he will make a statement on the matter. [55090/13]
Amharc ar fhreagraFreagraí scríofa
Section 14 of Finance Act 2012 introduced the Special Assignee Relief Programme (SARP) which is designed to reduce the cost to employers of assigning key individuals in their companies from abroad to take up positions in the Irish based operations of their employer. Paragraph 10 of Section 14 provides that relevant employers must submit an annual return to the Revenue Commissioners detailing, inter alia, the number of employees and the amounts of exempt income claimed under the programme. The first year of the programme was 2012 and employer returns received to date for 2012 have provided the following results:
Numbers of employees availing of the scheme: 7
Numbers of employers with employees availing: 7
Amount of tax forgone: €60,600 (tax free income of 147,817 by 41% for 7 individuals only)
Numbers of employees for whom education fees were paid: none
Amount of education fees paid: € nil
Number of jobs created: 5
The 7 individuals qualifying for the relief received an aggregate total tax-free remuneration of €147,817 and the amount of tax forgone is estimated assuming the top rate of income tax rate of 41%.
Following a review of SARP claims it was identified that 3 claims did not satisfy the eligibility criteria and the relief was found to be not appropriate for 2012. The statistics have, therefore, been updated to exclude these claims, and this accounts for the decrease in some of the figures that were provided with previous information.
More limited details of further claims were also provided as follows in the Form 11 tax returns for 2012 filed under the self-assessment system in October/November of 2013.
Numbers of employees availing of the scheme: 8
Estimated amount of tax forgone: €63,600 (rounded to nearest €100), on the basis of tax free income of €154,720 at an assumed tax rate of 41%.
Other information such as numbers of employers associated with employees availing of the scheme, numbers of employees for whom education fees were paid and amount of education fees paid is not required to be provided by taxpayers in the Form 11 tax return and is therefore not available.
Tax Reliefs Cost
Ceisteanna (112)
Michael McGrath
Ceist:112. Deputy Michael McGrath asked the Minister for Finance the number of persons to date that have availed of the foreign earnings deduction relief; the amount of tax foregone as a result of the tax relief granted; his views on the number of jobs that may have been created under the programme; and if he will make a statement on the matter. [55091/13]
Amharc ar fhreagraFreagraí scríofa
Section 12 of Finance Act 2012 provided for a limited tax deduction for individuals who temporarily carry out the duties of their office or employment in Brazil, Russia, India, China or South Africa. The provision applies as respects the years 2012, 2013 and 2014. The first year of the programme was 2012 and the relevant details of tax claims received to date from PAYE employees for that year are as follows:
Numbers of employees availing of the scheme: 25
Relevant Countries: China, India, Russia, South Africa and Brazil.
Number of employers associated with employees availing of the scheme: 21
Amount of tax forgone: €120,400 (rounded to nearest €100).
Details of further claims were also provided as follows in the Form 11 tax returns for 2012 filed under the self-assessment system in October/November of 2013:
Numbers of employees availing of the scheme: 51
Relevant Countries: China, India, Russia, South Africa and Brazil.
Number of employers associated with employees availing of the scheme: not available
Estimated amount of tax forgone: €455,000 (rounded to nearest €100), on the basis of an assumed tax rate of 41%.
The deduction was extended in Finance Act 2013 to include related travel to Egypt, Algeria, Senegal, Tanzania, Kenya, Nigeria, Ghana and the Democratic Republic of the Congo for the 2013 & 2014 tax years. Any further extension of the deduction for work related travel to other countries would be a matter for consideration as part of the annual Budget and Finance Bill process.
Employers have no role in this relief; it is claimed at the end of the year by the employee who has undertaken the travel. Therefore, it is not possible to say how many jobs may have been created.
Tax Collection Forecasts
Ceisteanna (113, 114)
Michael McGrath
Ceist:113. Deputy Michael McGrath asked the Minister for Finance the cost to the Exchequer that would arise from increasing the threshold for the top rate of tax for single earners from €32,800 to €34,000, €35,000, €38,000 and €40,000, respectively; and if he will make a statement on the matter. [55092/13]
Amharc ar fhreagraMichael McGrath
Ceist:114. Deputy Michael McGrath asked the Minister for Finance the cost to the Exchequer that would arise from increasing the threshold for the top rate of tax for single earners from €32,800 to €34,000, €35,000, €38,000 and €40,000, respectively, with pro rata increases for married-civil partnership couples with two earners; and if he will make a statement on the matter. [55093/13]
Amharc ar fhreagraFreagraí scríofa
I propose to take Questions Nos. 113 and 114 together.
I assume that the Deputy refers to increases in the standard rate tax bands, which would apply similarly to single and widowed persons, as well as to lone parents. In addition, the proposed increases are assumed to also apply to married/civil partnership couples. On this basis, I am informed by the Revenue Commissioners that the full year cost to the Exchequer, estimated by reference to 2014 incomes, of increasing the single person's standard rate tax band to €34,000, €35,000, €38,000 and €40,000 while also maintaining the current monetary differences between the single person's standard rate tax band and the various other classes of standard rate tax bands would be of the order of €190 million, €340 million, €740 million, and €975 million respectively.
These figures are estimates from the Revenue tax-forecasting model using latest actual data for the year 2011, adjusted as necessary for income and employment trends in the interim. They are, therefore, provisional and likely to be revised.
Tax Collection Forecasts
Ceisteanna (115)
Michael McGrath
Ceist:115. Deputy Michael McGrath asked the Minister for Finance the cost to the Exchequer of increasing the PAYE and personal tax credits by €100, respectively; and if he will make a statement on the matter. [55094/13]
Amharc ar fhreagraFreagraí scríofa
I am advised by the Revenue Commissioners that the estimated full year cost to the Exchequer, estimated by reference to 2014 incomes, of increasing the PAYE and personal tax credits by €100 respectively, would be of the order of €315 million. The increase in the personal tax credits mentioned in the Deputy’s question is assumed to apply in similar measure to widowed persons tax credit and to include the normal consequential increases in the tax credit for lone parents and the married tax credit. These figures are estimates from the Revenue tax-forecasting model using actual data for the year 2011 adjusted as necessary for income and employment trends in the interim. They are therefore, provisional and likely to be revised.
Tax Collection Forecasts
Ceisteanna (116)
Michael McGrath
Ceist:116. Deputy Michael McGrath asked the Minister for Finance the approximate cost to the Exchequer from introducing a €100 per child tax credit; and if he will make a statement on the matter. [55095/13]
Amharc ar fhreagraFreagraí scríofa
I am advised by the Revenue Commissioners that the estimated full year cost to the Exchequer, estimated by reference to 2014 incomes, of introducing an income tax credit of €100 for every child would be of the order of €68 million. This estimate is derived from the Revenue tax-forecasting model using actual data for the year 2011 adjusted as necessary for income and employment trends in the interim. It is therefore, provisional and likely to be revised.
Fiscal Policy
Ceisteanna (117)
Michael McGrath
Ceist:117. Deputy Michael McGrath asked the Minister for Finance the current state of proposals for the implementation of a common consolidated tax base within the EU; and if he will make a statement on the matter. [55097/13]
Amharc ar fhreagraFreagraí scríofa
After nearly ten years of consultation, drafting, and discussion, on 16th March 2011 the European Commission published its proposal for a Common Consolidated Corporate Tax Base (CCCTB). This represented the beginning of a process that involves a detailed examination of the proposal, line by line, by all Member States at the Council working group. Since the Commission's proposal was published, Department of Finance officials, along with officials from the Revenue Commissioners, have been attending the Working Party on Tax Questions which is the forum for discussions on the proposal. To date, officials have attended meetings on a regular basis but there is still some way to go before agreement on the Commission's proposal could be expected.
In March 2013 the Irish Presidency circulated a "road map" paper following an orientation meeting of high level officials, setting out the next steps for discussions on the proposal. This roadmap will provide a context for the continuing discussions on the proposal. Work on the proposal is now focusing on a step-by-step approach. The first step will examine issues relating to a common tax base – consolidation can be examined at a later date.
The Irish Presidency also circulated compromise text which reflected the first round of discussions on the proposal. Further meetings took place under the Lithuanian Presidency.
Ireland’s position is that we are constructively engaging with the discussion.
Mortgage Interest Relief Expenditure
Ceisteanna (118)
Michael McGrath
Ceist:118. Deputy Michael McGrath asked the Minister for Finance the total tax expenditure in respect of residential mortgage interest relief in each year from 2010 to date in 2013; the way the projected cost in 2012 was impacted by changes in mortgage interest rates; and if he will make a statement on the matter. [55098/13]
Amharc ar fhreagraFreagraí scríofa
I am informed by the Revenue Commissioners that the cost to the Exchequer of mortgage interest relief for principal private residences by way of tax relief at source (TRS) in the years 2010 to 2013 inclusive is as follows:
|
Tax Year |
Cost €m |
|
2010 |
€375 |
|
2011 |
€357 |
|
2012 |
€411 |
|
*2013 (11 months) |
€324 |
*This figure is provisional and subject to revision.
The expected cost to the Exchequer of tax relief allowed for mortgage interest in the 12 months of 2013 is provisionally estimated at €400 million. Costs are rounded to the nearest million.
The impact of interest rate changes on the cost of mortgage interest tax relief for principle private residences would depend on a variety of factors, including the numbers of mortgages affected, the monetary amount of the qualifying loans taken out; the rate of relief applying to those qualifying loans, the year the qualifying loans were taken out and the extent to which the ceilings for relief are impacted by changes in interest rates. Accordingly, it is not possible to provide an accurate estimate of how the cost of the tax relief in 2012 was affected by changes in mortgage interest rates.
Banking Sector
Ceisteanna (119)
Michael McGrath
Ceist:119. Deputy Michael McGrath asked the Minister for Finance the value of senior and subordinated bonds outstanding in AIB and Permanent TSB; and if he will make a statement on the matter. [55099/13]
Amharc ar fhreagraFreagraí scríofa
I have been informed by AIB that all relevant disclosures in relation to its senior and subordinated bonds in issue at 30 June 2013 are shown on pages 88 and 90 of AIB’s 2013 Half Yearly Financial Report which was published on 1 August 2013. I am informed by Permanent TSB (“PTSB”) that as of 30 June 2013 it had €3.7 billion of senior debt outstanding and €0.4 billion of subordinated debt outstanding as shown on page 52 of PTSB’s 2013 Half-Year Report.
In total there were €13.2 billion of outstanding senior and subordinated bonds outstanding at AIB and PTSB at 30 June 2013 as set out in the following table.
|
AIB |
PTSB |
Total |
|
|
Senior bonds outstanding € million* |
7,823 |
3,678 |
11,501 |
|
Subordinated bonds outstanding € million** |
1,311 |
367 |
1,678 |
|
Total € million |
9,134 |
4,045 |
13,179 |
* PTSB senior bonds includes securitisations
** Subordinated bonds includes the Contingent Convertible Capital Notes issued to the Minister for Finance by both AIB and PTSB .