Written Answers Nos. 201 - 216
201. Deputy Finian McGrath asked the Minister for Finance his views on correspondence regarding a pension company and bank conduct in the misrepresentation of product sold, and fraud, in respect of a person (details supplied) in Dublin 3; and if he will make a statement on the matter. [10112/15]
Amharc ar fhreagraAllegations of fraudulent or illegal activity should be brought to the attention of An Garda Síochána. It is not the role of the Minister for Finance to act as an intermediary. I understand from the details supplied that the correspondent has reported the matter to An Garda Síochána and it would not be appropriate for me to comment on an ongoing investigation.
I must also point out that the Financial Services Ombudsman is independent in the carrying out of his duties. I have no role in the day to day workings of the office or in the decision which he takes.
One of the main roles of the Financial Services Ombudsman is to investigate, mediate and adjudicate complaints about the conduct of regulated financial service providers. Investigations by the Financial Services Ombudsman are free of charge to the consumer.
The legislation governing the FSO is clear about the circumstances in which he can decline to investigate a complaint.
According to the relevant legislation, the Financial Services Ombudsman can decide not to investigate a complaint or to discontinue an investigation of a complaint on the grounds that
(a) the complaint is frivolous or vexatious or was not made in good faith or
(b) the subject-matter of the complaint is trivial or
(c) the conduct complained of occurred at too remote a time to justify investigation or
(d) there is or was available to the complainant an alternative and satisfactory means of redress in relation to the conduct complained of or
(e) the complainant has no interest or an insufficient interest in the conduct complained of.
The legislation is also clear that the Ombudsman is an independent officer and it would not be appropriate for me to intervene in an individual complaint or to comment on how the complaint was treated.
202. Deputy Clare Daly asked the Minister for Finance if he will consider the case of persons (details supplied) whose assets were transferred by Allied Irish Banks to the National Asset Management Agency, without informing the agency of the full situation regarding the asset, contrary to section 7 of the National Asset Management Act 2009. [10120/15]
Amharc ar fhreagraI wish to advise the Deputy that we have received Ministerial Representations from persons (details supplied) along with other Deputies on this issue.
In these cases my Department have advised that the situation outlined in your question is best addressed to NAMA. NAMA operates a dedicated email address, oir@nama.ie, to enable TDs and Senators to raise matters of concern directly with it and I would recommend that if the Deputy is concerned about a particular matter, she should feel free to bring this to NAMA's attention at this address. I can assure the Deputy that NAMA fully investigates all matters of concern brought to its attention.
However, I am advised that NAMA is fully satisfied that this is an eligible bank asset within the meaning of the NAMA Act.
203. Deputy Michael McGrath asked the Minister for Finance the cost of allowing the full adult ceiling of €1,000 for private medical insurance qualify for tax relief at 20% for all adults aged 21 years and over, regardless of whether they are availing of a reduced premium; and if he will make a statement on the matter. [10126/15]
Amharc ar fhreagraAs the Deputy may be aware, I recently announced my intention to amend tax relief for medical insurance premiums for young adults from 1 May 2015 on foot of changes introduced under the Health Insurance (Amendment) Act 2014, which provides that those aged between 21 and 25, can avail of reduced premium rates below the full adult price and that those aged between 18 and 20 can avail of a child's premium price, should an insurer choose to offer such reduced premiums.
With a view to ensuring consistency between health legislation and the tax code in relation to medical insurance and with the intention of keeping the tax relief for medical insurance premiums as simple as possible, I have decided to allow the full adult ceiling of €1,000, or the relevant premium where this is lower, for tax relief at 20%, for all adults aged 21 and over, regardless of whether they are availing of a reduced premium. I am retaining the child ceiling of €500 for those aged 18 to 20 that are continuing to avail of insurance at the child premium rates.
The Revenue Commissioners have agreed to operate the changes on an administrative basis pending the provision of the underpinning legislation as part of the next Finance Bill. Therefore, the changes will be effective for all policies purchased or renewed (or which come into effect) on or after 1 May 2015.
The current regime for tax relief on medical insurance premiums provides a maximum tax relief ceiling of €500 in respect of a child, which is defined as an individual under the age of 18 years or, if over 18 years of age and under 23 years of age, who is receiving full-time education and in respect of whom a child premium is paid.
It is important to note that it is not compulsory for insurers to offer child premium rates to young adults under the current system and it will not be compulsory for them to offer reduced premiums under the new system. Therefore, where a full adult premium is payable, the full adult ceiling for tax relief of €1,000 has always been available and this will continue to be the case. It should be further noted that the maximum tax relief is available at the rate of 20% of the premium payable or €200, whichever is lower. Thus, where a reduced premium is being availed of, the full adult ceiling for relief may not be employed depending on the premium price.
The Revenue Commissioners tentatively estimate that the cost of extending the full €1,000 adult ceiling for private medical insurance tax relief to all persons aged 21 or over, would be approximately €1 million.
This provisional estimate is based on returns to Revenue for the year 2013 (the most recent year for which data is available) and does not take account of any changes in the level of medical insurance coverage or premium rates in the interim.
204. Deputy Peadar Tóibín asked the Minister for Finance the position regarding local property tax in respect of a person (details supplied) in County Meath; and if he will make a statement on the matter. [10133/15]
Amharc ar fhreagraI am advised by Revenue that a key aspect of the work undertaken in regard to Local Property Tax (LPT) was the development of a comprehensive property register of residential properties in the State. The Register was populated using data drawn from a range of sources including Revenue's own databases and various other Government and non-Government sources. These various data sets were cross-checked by Revenue to ensure the accuracy of the information in respect of each property being included on the Register.
However, given the scale of the project it was inevitable that there would be some errors and in a relatively small number of instances, properties were either duplicated or omitted from the Register. The Deputy will be aware that Revenue communicated extensively in regard to this possibility and the onus was clearly placed on property owners to confirm the correct details where the information on the Register was inaccurate.
On foot of the correspondence received from the person on 27 February, direct contact was made with him by the LPT team and the Register was corrected in respect of the property. During the course of the direct contact it emerged that the person had also not filed an LPT Return or made any payment in respect of his current principal private residence. The LPT team member assisted the person in completing an LPT Return for his property and also advised him on the various options available to him in respect of the outstanding liability taking account of his individual circumstances.
205. Deputy Paul J. Connaughton asked the Minister for Finance if there are tax incentives for establishing primary care centres or plans to introduce such incentives; and if he will make a statement on the matter. [10141/15]
Amharc ar fhreagraI am advised by the Revenue Commissioners that there are, at present, no tax reliefs or incentives available for establishing primary care centres.
I do not intend to introduce such an incentive at this time. I receive numerous requests for the introduction of new tax reliefs and the extension of existing ones. In considering these, I must be mindful of the public finances and the many demands on the Exchequer given the current budgetary constraints. Tax reliefs, no matter how worthwhile in themselves, reduce the tax base and make general reform of the tax system that much more difficult.
206. Deputy Michael McGrath asked the Minister for Finance the circumstances in which a significant number of old age pensioners were recently overcharged tax as a result of an error in the processing of tax credits; and if he will make a statement on the matter. [10149/15]
Amharc ar fhreagraI am advised by the Revenue Commissioners following a recent upload by them of pension information to their records, some anomalies in the complex technical and business rules that underpin the interface of that data into their system caused incorrect Tax Credit Certificates (TCCs) to issue to a small number of DSP pension recipients. Consequently these pension recipients may have been overtaxed on their occupational pensions or salary.
I am advised by the Revenue Commissioners that a little over 2,000 pension recipients may have been overtaxed in error. The Commissioners have now issued corrected TCCs to the relevant pension providers and employers and the situation will be rectified in the next salary or occupational pension payment received by the taxpayers in question. The Commissioners regret any inconvenience or upset caused to individual taxpayers.
207. Deputy Joe Carey asked the Minister for Finance the number of cases detected by the Revenue Commissioners where laundered diesel was found to be for sale in the forecourts of fuel stations since 2010; and if he will make a statement on the matter. [10168/15]
Amharc ar fhreagraThe information requested is being complied by the Revenue Commissioners and will be forwarded to the Deputy as soon as possible.
208. Deputy Róisín Shortall asked the Minister for Finance if he will examine the issue of patients having to pay 23% value added tax for renting a concentrator for oxygen, in order that they can remain at home; and if he will undertake to reduce the value added tax charged in these circumstances in view of the hardship this imposes on such families and the saving that arises from allowing such patients to remain in their own home. [10220/15]
Amharc ar fhreagraI am advised by the Revenue Commissioners that the VAT rating of goods and services is subject to the requirements of EU VAT law with which Irish VAT law must comply. In the circumstances outlined, the service of renting a concentrator for oxygen is liable to VAT at the standard rate, currently 23%.
I am also advised by the Commissioners that the Value-Added Tax (Refund of Tax) (No. 15) Order 1981 enables VAT paid on qualifying goods, which may include a concentrator for oxygen, to be refunded where the goods are purchased for the exclusive use of disabled persons suffering a specified degree of disablement. The Order does not however apply to VAT on the rental of qualifying goods.
209. Deputy John Halligan asked the Minister for Finance further to previous questions tabled in Dáil Éireann regarding this issue, the progress to date regarding the Central Bank of Ireland's investigation into the misselling of payment protection insurance policies; the number of companies that were ordered to write to their customers; the number of customers per company that were to be written to; the estimated number of customers who will be eligible to receive refunds; his views that the process of contacting customers and gathering the relevant information is moving as swiftly as possible; if he will acknowledge that time is of the essence in certain cases, where the statute is in danger of running out; his plans to intervene and ensure all customers are provided with the opportunity to lodge complaints and have their individual cases investigated; and if he will make a statement on the matter. [10248/15]
Amharc ar fhreagraI have been informed by the Central Bank that, following the conclusion of its investigation, the Central Bank issued its Summary Report of its Payment Protection Review ("the PPI Review") in March 2014. The PPI Review included the sales by 11 credit institutions since July 2007.
I have also been informed by the Central Bank that it is continuing to engage with smaller entities that sold PPI including Credit Unions.
To date this has resulted in a total refund of €69.5 million (including €6.1 million in interest). Around 83,490 policies have been refunded. The Central Bank stated in March 2014 that 22% of consumers were covered by refunds.
Firms were required to demonstrate that their PPI sales were in compliance with the Consumer Protection Code. This included requirements to assess and evidence suitability and eligibility and to check that claims were not declined for reasons which the seller should have identified during the sales process.
As part of the overall PPI review, all consumers were written to by firms participating in the review giving them the opportunity to complain to the Financial Services Ombudsman if they were unhappy with the findings of the individual review of their PPI policy.
Consumers who are still unhappy with any aspect of the sale of PPI should refer their complaints to the Financial Services Ombudsman.
The summary report, along with a Q&A document are available on the Central Bank website at the links below:
http://www.centralbank.ie/press-area/press-releases/Pages/CentralBankreportsonthePaymentProtectionInsurancereview.aspx.
210. Deputy Niall Collins asked the Minister for Finance the process followed by the Revenue Commissioners when registering a charge and-or judgment against a person's property for unpaid taxes; if he will confirm if the taxpayer is notified by letter at the commencement of this process; and if he will make a statement on the matter. [10268/15]
Amharc ar fhreagraI am advised by Revenue that it has a strong focus on making sure every taxpayer and business complies with the responsibility to pay the right amount of tax, including interest and penalties where due, in full and on time. This is an appropriate and correct focus for Revenue and one that I fully endorse. Any delay in the collection of tax that is properly due adds to the level of Government borrowing and public debt interest and confers an unfair competitive advantage on non-compliant businesses.
Revenue assures me that its strong preference is to work with viable businesses or taxpayers suffering temporary cash flow difficulties to agree a mutually acceptable solution rather than deploying debt collection/enforcement options. Revenues commitment in this regard is clearly evidenced by the fact that it granted almost 9,000 phased payment arrangements in respect of over €120m of debt during 2014 rather than using debt collection/enforcement action to secure the liabilities.
Where debt collection/enforcement action becomes necessary to secure an outstanding debt, the Revenue caseworker firstly writes to the defaulting business or taxpayer demanding that the liability be paid within a specified timeframe, which is normally seven days. The final demand letter also clearly warns that the consequence of continued non-compliance is referral of the debt to enforcement. Revenues first line debt collection/enforcement options for the majority of cases are Sheriff and Solicitor action and when a case is referred, responsibility for any future negotiation is delegated to the collection agent.
Once a case is referred for debt collection/enforcement, the Sheriff or Solicitor writes to the taxpayer or business offering a final opportunity to agree a mutually acceptable solution. Where no solution can be agreed, the Sheriff or Solicitor then seeks to collect the outstanding amounts, including costs, in accordance with the various legal powers available to them.
Solicitor (Court) action is used to secure judgment against a defaulting business or taxpayer. The judgment, which confirms the debt before the Courts, can be made public and can also be used by Revenue to place judgment mortgages against any property (owned by the business or taxpayer) to the value of the outstanding debt. Judgments are also used as part of the proceedings associated with Bankruptcy, Forced Sale of property and committal to prison, though Revenue only applies such sanctions in the most egregious or intransigent cases. In all cases where judgment is sought, the business or taxpayer is notified by way of Court summons.
Finally in regard to notification of judgment mortgages, Revenue has confirmed to me that it is the responsibility of the Property Registration Authority to inform the business or taxpayer that such a charge has been put in place.
211. Deputy Dan Neville asked the Minister for Finance the position regarding property tax in respect of a person (details supplied) in County Limerick; and if he will make a statement on the matter. [10285/15]
Amharc ar fhreagraI am advised by Revenue that the person to whom the Question refers paid his 2014 Local Property Tax (LPT) by Single Debit Authority (SDA) rather than by Direct Debit.
For the Deputy's information, the SDA option facilitates a single deduction from a current account (like an electronic cheque) and does not carry over from year to year in the way that Annual Debit Authorities, Direct Debits and Deductions at Source from salaries/pensions do.
Revenue also confirmed to me that a member of the LPT team has already made direct contact with the person and explained the various payment options to him. On foot of the discussions the person has again opted to use SDA to pay his 2015 LPT liability. The LPT team member activated the option for the person and his payment will be deducted from his current account on 21 March 2015.
212. Deputy Finian McGrath asked the Minister for Finance the revenue raised from property tax in 2014; and if he will make a statement on the matter. [10301/15]
Amharc ar fhreagraI am advised by the Revenue Commissioners that compliance data in relation to the Local Property Tax (LPT), including receipts in 2014, is available on the Commissioners' website at http://www.revenue.ie/en/about/statistics/lpt-compliance.html. Updates to these statistics will be published in due course.
The Commissioners have confirmed that €491 million was collected in Local Property Tax in 2014.
213. Deputy Seán Ó Fearghaíl asked the Minister for Finance if value added tax will be reimbursed as a matter of urgency, arising from the home renovation incentive scheme, in respect of a person (details supplied) in County Kildare. [10336/15]
Amharc ar fhreagraThe Home Renovation Incentive (HRI) provides tax relief for homeowners by way of an income tax credit at 13.5% of qualifying expenditure on repair, renovation or improvement works carried out on a main home by qualifying contractors. The tax credit is based on work subject to 13.5% VAT.
The tax credit is available to individuals who pay income tax either under the PAYE system or under self assessment and is spread evenly over two years. The tax credit is only available against income tax. Full details in respect of the HRI Scheme is available on the Revenue Commissioner's website at www.revenue.ie/en/tax/it/reliefs/hri/hri-general-faqs.html#section2.
I am advised by the Revenue Commissioners that based on the information available to them, the person concerned will not be liable to income tax during 2015. Accordingly, they will not be able to avail of the tax credit under the HRI in 2015. However, subject to having a taxable income, the credit can be carried forward and given as a HRI tax credit next year and the following year.
214. Deputy Marcella Corcoran Kennedy asked the Minister for Finance the reason the rules regarding investing in approved minimum retirement funds and approved retirement funds were changed; his views on reversing this decision; and if he will make a statement on the matter. [10339/15]
Amharc ar fhreagraFinance Act 2014 introduced changes relating to the imputed distribution rate for certain approved retirement funds (ARFs) as well as provisions to allow owners of approved minimum retirement funds (AMRFs) to draw-down up to 4% of the assets of such funds on one occasion in each year instead of the facility to draw-down the accrued income and gains of such funds, as had applied prior to the changes. I understand that the Deputy is particularly interested in the latter issue.
Finance Act 2014 reduced the annual imputed ARF distribution rate from 5% to 4% for ARF owners in the age group 60 to 70 years whose ARFs have assets of €2 million or under. This change was introduced in order to reduce the risk that individuals in that age group might outlive the funds in their ARFs (or vested PRSAs).
As regards the changes to AMRF access, I should explain by way of background, that under the flexible options at retirement arrangements (the so-called ARF option), where an individual in a Defined Contribution pension savings arrangement is under age 75 at the time of exercising the option and does not meet the guaranteed pension income requirement of €12,700 per annum, that individual must place a maximum set aside amount of €63,500 (or the remainder of the pension funds if less than €63,500 after taking the retirement lump sum) in an AMRF or purchase an annuity with the €63,500.
Any amount of remaining pension funds in excess of €63,500 can be invested in an ARF with access to those funds at the owners discretion (subject to tax, at the marginal rate and having regard to the imputed distribution requirements).
The purpose of the AMRF is to ensure that an individual without the minimum guaranteed pension income for life has a pension nest egg to provide for the latter years of his/her retirement. Up to Finance Act 2014, the capital invested in an AMRF could not be accessed until the AMRF owner reached age 75 (or meets the guaranteed pension income requirement before then) at which point the AMRF becomes an ARF with unrestricted access to the funds, subject to taxation. While the capital sum in an AMRF could not be accessed, as set out, any income, profits or gains accrued from the investment of the capital could, up to now, be withdrawn by the AMRF owner, subject to tax at the marginal rate.
I decided to change the arrangements for AMRFs so as to allow AMRF owners voluntary, tax-liable access to a maximum of 4% of their AMRF assets each year up to the point at which the AMRF becomes an ARF. This change provides AMRF owners with access to a definitive and certain level of income from their AMRF rather than the uncertain level of income which access to the accrued income, profits and gains in the AMRF provided.
Under the previous access arrangements for AMRFs, the extent of any income, profit or gains would depend on the performance of the investment options taken and could, therefore, be highly volatile with the possibility of little or no gains accruing in certain years. In addition, the scale of the capital allowed for in an AMRF, at €63,500, would not always permit for investment returns of any significant scale to be made using a prudent investment policy.
The change allowing access to a specified percentage of the capital in an AMRF is primarily aimed at those individuals whose AMRF constitutes a significant part of their retirement funds and who, while not wishing to purchase a pension annuity with those funds, may require access to a portion of these funds to provide a more certain form of supplementary pension income prior to reaching age 75. This facility also ensures that an individual will have some remaining funds in the AMRF at age 75 to provide for their remaining years, assuming the individual has not purchased a pension annuity in the meantime.
Individuals whose AMRF represents a less significant part of their retirement funds and whose circumstances would allow for greater investment risk and, therefore, potentially greater investment returns will be limited to the 4% level of asset draw down. However, this draw down will also be available to them for periods when their AMRF investments make losses or returns of less than 4% of the value of their AMRF assets and where, under the previous arrangement, they would not have been able to make a draw down or a draw down of a lesser value than will now be permitted. I consider that the change will be to the benefit of AMRF owners, generally, over the medium to longer term and I have no plans to reverse it.
215. Deputy Catherine Murphy asked the Minister for Finance further to Parliamentary Question No. 157 of 15 November 2011, in which he stated that at no point were Irish pounds being printed or was consideration being given to printing them, if that was in fact the case, in view of comments made by the Minister for Public Expenditure and Reform (details supplied); if he will provide, in detail, the contingency plans referred to by that Minister; and if he will make a statement on the matter. [10351/15]
Amharc ar fhreagraMy response to Parliamentary Question No. 157 of 15 November 2011 was accurate, at no point in 2011 (or since) were Irish pounds being printed. This is not to state that no contingency plans were developed or that no consideration was given to the steps which could become necessary had the crisis then ongoing escalated to the point that the Euro was no longer available as a functioning currency. It would not be appropriate to publish the detail of any such contingency planning.
216. Deputy Paul Murphy asked the Minister for Finance his views that the recent master financial assistance facility agreement with Greece should be approved by Dáil Éireann before being enacted; and if he will make a statement on the matter. [10356/15]
Amharc ar fhreagraAs regards whether the extension of 4 months to the second Greek bailout programme would require the approval of Dáil Éireann, I can confirm that no Dáil approval or further domestic legislative steps are necessary. The loan agreement (Master Financial Assistance Facility Agreement) signed up to by Greece will have to be adjusted to take account of the extension. All that is required to the extension is Ministerial approval. A more detailed explanation follows.
The European Financial Stability Facility Act 2010 (No 16 of 2010), as amended by the European Financial Stability Facility and Euro Area Loan Facility (Amendment) Act 2011 (No 25 of 2011), provides for Ireland's membership of the European Financial Stability Facility (EFSF). This legislation incorporates the consolidated EFSF framework agreement, which includes amendments agreed in 2011. The EFSF Framework Agreement sets out the governance arrangements for the EFSF. This provides for a Board of Governors made up of the Finance Ministers of EFSF Member States, and a Board of Directors made up of senior Finance Ministry officials of the EFSF Member States.
Article 10(5)(d) of the consolidated EFSF Framework Agreement provides that the Board of Directors, by unanimous decision, may agree any modification to the availability period of any outstanding Financial Assistance (as well as modifications to the aggregate principal amount, repayment profile or interest rate).
On 20 February 2015, the Eurogroup noted a request from the Greek authorities for an extension of the second programme in order to allow the successful completion of the fifth review. The Greek authorities agreed to present a first list of reform measures, based on the current arrangement, by 23 February, which they have done.
The Institutions (the European Commission, the ECB and the IMF) have provided their first view on the list of reform measures and stated that the list is sufficiently comprehensive to be a valid starting point for a successful conclusion of the review. The measures will need to be further specified and then agreed with the Institutions by the end of April. On this basis, the Eurogroup on 24 February 2015 agreed in principle to proceed with the national approval procedures in order to extend the current programme by up to four months.
The resultant Third Amendment to the Master Financial Assistance Facility Agreement with Greece (MFFA) gives effect to the Eurogroup statement of 20 February 2015 by addressing two main aspects of the decision:
- Extending the Availability Period of the Loan Facility under the MFFA for a further 4 months to the end of June 2015.
- The return of the EFSF funds held by the Hellenic Financial Stability Fund (HFSF), and making those funds available for the duration of the MFFA extension for bank recapitalisation and resolution costs.
The Amendment Agreement also includes some other administrative changes to the MFFA, as well as consequential changes required to implement the two aspects above. This amendment is being agreed on the basis of proposals presented by Greece, and the agreement in principle to the extension, indicated by me at Eurogroup, was in accordance with the provisions of the Framework Agreement as approved by the Oireachtas in the legislation already referenced. The question of Dáil approval does not therefore arise.
