I understand the Deputy to be referring to reliefs or credits eliminated or commencing to be phased out following changes made in the Finance Acts in 2012 and 2013. The tax reliefs and credits which follow were ceased or are being phased out as a consequence of those Acts.
I am advised by the Revenue Commissioners that Exchequer costs or savings are not available for all measures referred to. For those where information is available, tax returns for 2013 were only due late last year and that the data are currently being processed for analysis. Returns for tax year 2014 are not due to be filed until later this year. Estimated costs of reliefs, allowances and credits for 2012 are published on Revenue's statistics website at http://www.revenue.ie/en/about/statistics/index.html. Updates for later years will be published shortly on the same webpage. In the current absence of this information for 2013 onwards I am providing the Budget estimates relating to the various credits or reliefs, where available.
The section numbers refer to the Taxes Consolidation Act 1997.
Section 87B and section 381B: Section 18 of the Finance Act 2013 applied the following changes, with effect from 13 February 2013, to the taxation of certain individuals deemed to be engaged in the trade of dealing in or developing land:
- Loss relief, related to both the decline in land values and interest deductions, was restricted to circumstances where the decline in value is actually realised and interest on the funding loan is actually paid, and
- The write-off of debts used to acquire land as trading stock, became an income receipt. Previously the write-off of the loan was treated as a capital adjustment and was not taxable.
The purpose of these changes was to deny tax deductions in circumstances where there is no real economic loss suffered by the taxpayer.
Section 88A and section 472A: Section 7 Finance Act 2013 discontinued the double deduction in respect of certain emoluments and relief for the long term unemployed, in respect of employments commencing on or after 1 July 2013. They were replaced by the new JobsPlus scheme.
Section 126: Section 8 of the Finance Act, 2013 removed the tax exemption in respect of maternity benefit, adoptive benefit and health and safety benefit with effect from 1st July 2013.
Section 201: Foreign Service Relief on ex gratia termination lump-sum payments, provided for in section 201 of Taxes Consolidation Act 1997, was abolished with effect from the passing of Finance Act 2013 (27 March 2013).
Section 201 and Schedule 3: Top Slicing Relief (TSR) on ex-gratia lump sums payments was ceased from 1 January 2013 where the payment was €200,000 or over. The yield was estimated at €10m in a full year. TSR was abolished completely for ex gratia payments made on or after 1 January 2014 with an expected yield of €22m in a full year.
Section 201: Finance Act 2013 applies a lifetime limit of €200,000 on the amount that may be paid tax-free to ex-gratia payments made on account of the death or disability of an employee. Any amount exceeding €200,000 is taxable in full.
Section 253: Relief to individuals on loans applied in acquiring an interest in a partnership was abolished for new loans with effect from 15 October 2013. Relief for existing loans was restricted commencing in 2014, with relief being reduced on a sliding scale each year until 2016 with no relief available in 2017. Savings of €1m in 2014, and €4m for each year thereafter, were estimated.
Section 261A and Section 267C: Section 23 of Finance (No. 2) Act 2013 removed the exemption from Deposit Interest Retention Tax (DIRT) which applied to a portion of interest earnings on medium and long term accounts held in financial institutions or credit unions. Medium term accounts are defined as accounts which are held by a deposit taker for a minimum of three years and long term accounts are those held for a minimum of five years. The first €480 of interest earned in any year on medium term accounts, and the first €635 of interest earned in any year on long term accounts, was exempt from DIRT. New accounts opened on or after the 16th October 2013 cannot qualify for the relief but medium and long term accounts opened prior to that date continue to qualify for a duration of three and five years respectively from the date the accounts were opened. The amount of DIRT forgone in respect of medium and long term accounts is not returned to Revenue.
Section 268 and 316: Section 8 of the Finance Act, 2009 provided that capital expenditure on two property tax incentive schemes had final termination dates in 2013. In relation to the Mid Shannon Corridor Tourism Infrastructure Investment Scheme, capital expenditure incurred up to 31 May 2013 qualified for relief. In relation to Qualifying Private Hospitals, provided certain conditions were met, capital expenditure incurred up to 31 December 2013 also qualified for relief.
Section 462: The One Parent Family Tax Credit (OPFTC) of €1,650 for a single individual with whom a qualifying child resided during a tax year was ceased at 31 December 2013. It was replaced by the Single Person Child Carer Credit from 1 January 2014. This was estimated to yield €18m in 2014 and €25m in a full year.
Section 470: A cap was introduced on relief for premiums for qualifying health insurance policies in respect of policies entered into or renewed on or after 16 October 2013. A maximum relief of €1,000 per adult and €500 per child covered by a policy was introduced. This was estimated to yield €94m in 2014 and €127m in 2015.
Section 481: Income tax relief for individuals who invest in the production of qualifying films was abolished with effect from 1 January 2015. This relief has been replaced by a Corporation Tax credit of 32% of qualifying expenditure incurred by a Film Production Company in the making of a qualifying film. The cost to the exchequer for the income tax relief in 2013 was estimated to be €76m based on investment in qualifying expenditure of €185m relieved at the 41% marginal income tax rate. If a similar level of qualifying expenditure is incurred in 2015 the move to relief by way of a 32% Corporation Tax credit will yield a saving to the exchequer of €17m.
Section 486B: Section 486B provided for a scheme of tax relief for corporate investments in certain renewable energy projects in the solar, wind, hydro or biomass technology categories. The relief was given in the form of a deduction from a company's profits for its direct investment in new ordinary shares in the qualifying renewable energy company. The relief expired with effect from the 31st December 2014. As a relatively small number of claims were made in 2013 and 2014 in respect of this scheme, I am unable to provide a figure for the tax savings to the exchequer following the abolition of this scheme as release of this information may lead to the identification of the taxpayers who have availed of the relief.
Section 825B: Repayment of tax where earnings are not remitted was phased out with effect from tax year 2012 with end year of 2015. The Special Assignee Relief Programme (SARP - section 825C) was introduced from tax year 2012.
Section 848A: The scheme of tax relief for donations made to approved bodies (i.e. charities etc.) was amended in a number of respects with effect from 1 January 2013. One of the changes was that relief for donations made by self-assessed taxpayers, previously obtained by way of a deduction from taxable income, was aligned with that for PAYE-only taxpayers such that the relief is now given on a "grossed-up" basis at the rate of 31% to the approved body (and not to the donor). This and the other changes made were on a cost neutral basis.
Section 604A: The CGT property incentive scheme introduced by Budget and Finance Act 2012 and which commenced on 7 December 2011 ceased with effect from 31 December 2014. Since individuals must hold on to a property acquired for 7 years or more before disposing of it in order to qualify for the relief, no tax cost has therefore yet arisen in relation to the relief.
Indirect Taxation
In Section 55 of Finance Act (No. 2), 2013, I did not extend the Vehicle Registration Tax relief of up to €1,500 which had been available for flexible fuel vehicles, on the basis that this type of vehicle was largely redundant, which also meant that no savings arose.
In Statutory Instrument 139 of 2014, I abolished the disabled drivers' fuel relief and replaced it with a fuel grant scheme with effect from 1 January 2015. As the relief was replaced by a grant scheme of the same value, no savings resulted.
Disabled Drivers and Disabled Passengers (Tax Concessions) Scheme
As a consequence of a judgement of the Court of Justice of the European Union, the excise repayment of fuel element of the Disabled Drivers and Disabled Passengers (Tax Concessions) Scheme was converted into a fuel grant of the same value from 1 January 2015. As the grant is the same value as the excise relief, no savings have arisen to the Exchequer.
