Lucinda Creighton
Ceist:60. Deputy Lucinda Creighton asked the Minister for Finance his views on the possibility of VAT exemption for Iontophoresis devices; and if he will make a statement on the matter. [47625/14]
Amharc ar fhreagraVAT Exemptions
Ceisteanna (60)
Freagraí scríofa
I am advised by the Revenue Commissioners that the VAT rating of goods and services is constrained by the requirements of EU VAT law with which Irish VAT law must comply. Iontophoresis devices, are liable to VAT at the standard rate, currently 23%.
There is no provision in VAT law that would make it possible to apply an exemption or a zero rate to the supply of such products. Under the EU VAT Directive, Member States may retain the zero rate on goods and services which were in place on 1 January 1991, but cannot extend the zero rate to additional goods and services. In addition, Member States may only apply a reduced VAT rate to those goods and services which are listed under Annex III of the VAT Directive. While Annex III does include the supply of medical equipment for the exclusive personal use of a disabled person, it does not include Iontophoresis devices for general use. Therefore the only rate that can apply to the supply of Iontophoresis devices is the standard VAT rate of 23%.
Pensions Levy
Ceisteanna (61)
Pearse Doherty
Ceist:61. Deputy Pearse Doherty asked the Minister for Finance his views on a pension fund-trust which has already paid the pension levy warning its members that it may now apply a charge to their pensions retrospectively to cover the levy (details supplied); and if he will make a statement on the matter. [47500/14]
Amharc ar fhreagraFreagraí scríofa
I am advised by the Revenue Commissioners that the pension fund levy applies to the market value, on the valuation date (generally 30 June each year) of assets under management in pension funds and pension plans approved under Irish Tax legislation. The person responsible for payment of the levy is the "chargeable person" as defined in the legislation.
The chargeable person, as respects pension scheme assets held under contracts of assurance, is the insurer, and as respects other scheme assets is the administrator of the pension scheme. The administrator is defined in the relevant legislation as meaning the trustees or other persons having the management of the assets of the scheme.
Under the legislation, the payment of the levy is treated as a necessary expense of a pension scheme and the trustees or insurer, as appropriate, are entitled where needed to adjust current or prospective benefits payable under a scheme to take account of the levy. It is up to the trustees to decide whether, when and how the levy should be passed on and to what extent, given the particular circumstances of the pension schemes for which they are responsible.
However, the legislation also includes safeguards aimed at ensuring that benefits payable, either currently or prospectively to any member, are adjusted in such a way that the reduction in value of those benefits shall not exceed the appropriate percentage ( 0.6%, 0.75% or 0.15% depending on the year involved) of the market value of the assets accounting for the scheme's liabilities to that member.
I am not in a position to comment on the specific details of the letter. However, it would appear from the information submitted that the pension scheme members' AVCs have already been adjusted to reflect the pension levy paid by the trustees in respect of those funds. As regards the members' defined benefit scheme, it appears from the correspondence that the trustees are not proposing to make any adjustment to members' benefits at this point in time in respect of the levy payments on the defined benefit scheme assets but rather are pointing out to members that such adjustments may be necessary in the future depending on the financial performance of the scheme over the next two years. I would assume that before arriving at any decision on this matter the trustees will have taken appropriate professional advice.
Insurance Industry
Ceisteanna (62)
Terence Flanagan
Ceist:62. Deputy Terence Flanagan asked the Minister for Finance if a reduced premium charge will be introduced for pensioners driving vehicles (details supplied); and if he will make a statement on the matter. [47507/14]
Amharc ar fhreagraFreagraí scríofa
In my role as Minister for Finance I have responsibility for the development of the legal framework governing financial regulation. Neither I nor the Central Bank of Ireland, as regulator, interfere in the pricing of insurance products. The provision of insurance cover and the price at which it is offered is a commercial matter for insurance companies and is based on an assessment of the risks they are accepting and adequate provisioning to meet these risks.
The EU framework for insurance expressly prohibits Member States adopting rules which require the prior approval or systematic notification of certain matters, including general and special policy conditions and scales of premiums. Furthermore, in the context of non-life insurance, which includes public indemnity insurance, the EU framework provides non-life insurers with the freedom to set premiums. This has been acknowledged by the European Court of Justice.
The Central Bank does not regulate premiums in the insurance market. Insurance companies consider a number of risks when determining the premium for a proposed insurance policy, whether that is a general insurance policy such as motor or home insurance, or a life assurance policy. A premium is based on the actuarial calculation of risk.
Consumers are encouraged to shop around at the time of insurance renewal. The National Consumer Agency has information which may assist a consumer to shop around. It can be found at http://www.consumerhelp.ie/getting-insurance-quotes#Shopping.
Disabled Drivers and Passengers Scheme
Ceisteanna (63)
Paul Murphy
Ceist:63. Deputy Paul Murphy asked the Minister for Finance if he will amend the Disabled Drivers and Passengers (Tax Concessions) Regulation (S.I. 353 of 1994) to include those with single upper limb amputations. [47524/14]
Amharc ar fhreagraFreagraí scríofa
The Disabled Drivers and Disabled Passengers (Tax Concessions) Scheme provides relief from VAT and VRT (up to a certain limit) on the purchase of an adapted car for transport of a person with specific severe and permanent physical disabilities, repayment of excise duty on fuel, and an exemption from Motor Tax.
To qualify for the Scheme, an applicant must have a permanent and severe physical disability within the terms of the Disabled Drivers and Disabled Passengers (Tax Concessions) Regulations (S.I. 353 of 1994) and satisfy one of the six qualifying criteria outlined in the Regulations. The Senior Medical Officer for the relevant local Health Service Executive administrative area makes a professional clinical determination as to whether an individual applicant satisfies the medical criteria. A successful applicant is provided with a Primary Medical Certificate, which is required under the Regulations to claim the reliefs provided for in the Regulations. An unsuccessful applicant can appeal the decision of the Senior Medical Officer to the Disabled Drivers Medical Board of Appeal, which makes a new clinical determination in respect of the individual. The Regulations mandate that the Medical Board of Appeal is independent in the exercise of its functions to ensure the integrity of its clinical determinations. After six months a citizen can reapply if there is a deterioration in their condition.
To qualify for the Scheme an applicant must be in possession of a Primary Medical Certificate. To qualify for a Primary Medical Certificate, an applicant must be permanently and severely disabled within the terms of the Disabled Drivers and Disabled Passengers (Tax Concessions) Regulations 1994 and satisfy one of the following conditions:
- be wholly or almost wholly without the use of both legs;
- be wholly without the use of one leg and almost wholly without the use of the other leg such that the applicant is severely restricted as to movement of the lower limbs;
- be without both hands or without both arms;
- be without one or both legs;
- be wholly or almost wholly without the use of both hands or arms and wholly or almost wholly without the use of one leg;
- have the medical condition of dwarfism and have serious difficulties of movement of the lower limbs.
The Scheme represents a significant tax expenditure. Between the Vehicle Registration Tax and VAT foregone, and the repayment of excise on fuel used by members of the Scheme, the Scheme represented a cost of €43.5 million to the Exchequer in 2013. This figure does not include the revenue foregone to the Local Government Fund in the respect of the relief from Motor Tax provided to members of the Scheme. In terms of the numbers of beneficiaries of the Scheme in 2013, 4,355 citizens availed of the Vehicle Registration Tax and/or VAT relief, and 11,436 availed of the repayment of excise on fuel element of the Scheme.
The Department of Finance conducted a review of Disabled Drivers and Disabled Passengers Scheme in 1993, which informed the drafting and enactment of the 1994 Regulations. As part of the review, the position of single hand amputees was considered given extensive representations made seeking the inclusion of persons without the use of one arm or hand within the qualifying medical criteria. The review noted that such a disability did not present as serious a challenge to mobility as the extant qualifying criteria, and on that basis, and in the context of limited resources, priority should be given to those citizens with the greatest challenge to their mobility.
Unfortunately, the current context is still one of constrained resources. I recognise the important role that the Scheme plays in expanding the mobility of citizens with disabilities, and I have managed to maintain the relief at current levels throughout the crisis despite the requirement for significant fiscal consolidation. However, in the still challenging fiscal environment and given the scale and scope of the Scheme, I have no plans to expand the medical criteria beyond the six currently provided for in the Disabled Drivers and Disabled Passengers (Tax Concessions) Regulations 1994.
Deposit Interest Rates
Ceisteanna (64)
Pearse Doherty
Ceist:64. Deputy Pearse Doherty asked the Minister for Finance the revenue that will be raised in 2014 from the collection of DIRT on the dividends paid to children who save at credit unions. [47534/14]
Amharc ar fhreagraFreagraí scríofa
I am informed by the Revenue Commissioners that Deposit Interest Retention Tax (DIRT) on interest bearing deposits is returned on a four-times yearly basis by financial institutions: in April, July and October of the tax year in question and in the following January. Returns for each year are due by 15 January of the following year and the total value of DIRT due and paid is reported to Revenue on the January returns at institutional level. Sufficiently detailed information is not required in these returns to identify the DIRT on the dividends paid to children who save at credit unions.
Tax Code
Ceisteanna (65)
Eoghan Murphy
Ceist:65. Deputy Eoghan Murphy asked the Minister for Finance if all taxes on income were merged into a single tax structure, all tax reliefs and allowances on income were discontinued and no tax was charged on any earned income up to €15,000, the two income tax rates that would have to be set to collect the tax revenues collected in 2013, in view of principles of progressivity between the two rates and with entry into the marginal rate set at an income level of €50,000. [47537/14]
Amharc ar fhreagraFreagraí scríofa
I assume that the Deputy wishes to establish at what level the standard and marginal Income Tax rates alone would need to be set to yield to the Exchequer the receipts currently delivered through the combination of both Income Tax and Universal Social Charge (USC). These combined receipts totalled just under €16 billion in 2013.
I am informed by the Revenue Commissioners that, with reference to estimated 2015 incomes in circumstances outlined by the Deputy, where
1. all personal tax reliefs and allowances were discontinued,
2. the first €15,000 of income was subject to a 0% Income Tax rate,
3. the next €35,000 of income was subject to the standard Income Tax rate, and
all income in excess of €50,000 was subject to the marginal Income Tax rate. It is estimated it would be necessary to increase both the standard and marginal Income Tax rates by an additional 8 percentage points to 28% and 48% respectively to raise the Income Tax yield to the total amount currently collected through Income Tax and USC combined. All figures above are estimates for 2015, using the actual data for the year 2012 (the latest year for which data are available) adjusted as necessary for income, self-employment and employment trends in the interim. They are provisional and may be revised. A married couple or civil partners who have elected or have been deemed to have elected for joint assessment are counted as one tax unit. I am advised by the Revenue Commissioners that this scenario is presented purely for illustrative purposes, there are other permutations that could deliver similar outcomes. The Commissioners have not examined the administrative issues involved in the above scenario.
IBRC Liquidation
Ceisteanna (66)
Stephen Donnelly
Ceist:66. Deputy Stephen S. Donnelly asked the Minister for Finance the number of companies which had Irish Bank Resolution Corporation loans that were sold by KPMG to third parties, have since been put into liquidation where the liquidator was KPMG; his views on the potential conflict of interest in such cases; and if he will make a statement on the matter. [47540/14]
Amharc ar fhreagraFreagraí scríofa
Kieran Wallace and Eamonn Richardson are independent in their duties as Special Liquidators of IBRC and have a statutory responsibility to act in the interests of all the creditors of IBRC including the State. I am advised by the Special Liquidators that there are 7 instances where KPMG have been appointed as receiver over assets connected to loans disposed by IBRC. All insolvency appointments are in the name of the individual liquidator and individuals other than Kieran Wallace or Eamonn Richardson have been appointed in each of these 7 instances. The Special Liquidators are satisfied that no conflicts arise as a result of these appointments as these appointments are taken by other individuals in KPMG.