Written Answers Nos 249-268
249. Deputy Thomas P. Broughan asked the Minister for Finance if his attention has been drawn to the European Commission's study on structures of aggressive tax planning and indicators published in December 2015; if his officials have examined the report; if action has been taken since the publication of the report; if so, the actions; and if he will make a statement on the matter. [27170/17]
Amharc ar fhreagraI understand the question refers to a working paper that was prepared by consultants and published by the European Commission in December 2015. The Study highlights features of the tax regimes in each EU Member State that, in the view of the authors, could potentially be indicators of aggressive tax planning.
The agreed international approach to tackling aggressive tax planning is for all countries to implement the OECD Base Erosion and Profit Shifting (BEPS) recommendations, which were agreed in October 2015. Ireland is fully committed to implementing these recommendations and this process began with the implementation of Country by Country Reporting in Finance Act 2015. We have also fully implemented OECD exchange of information requirements in respect of tax rulings as agreed in BEPS Action 5.
The EU’s Anti-Tax Avoidance Directive, which was agreed in June 2016, represented a significant further step towards the implementation of the BEPS recommendations. The Directive will see three of the other key OECD BEPS recommendations implemented across Europe. These are rules targeting hybrid mismatches, interest deductibility rules and Controlled Foreign Company rules. Ireland will implement these changes in line with agreed deadlines set out in the Directive.
Most recently, the BEPS Multilateral Instrument was signed by Ireland and 67 other countries in Paris on 7 June. The Multilateral Instrument will provide the mechanism for extensive changes to tax treaties globally. It will ensure that tax treaties are updated to reflect a number of important OECD BEPS actions, including agreed standards on treaty shopping and dispute resolution.
We expect the European Commission to shortly publish a draft Directive requiring the disclosure of aggressive tax schemes in line with a BEPS recommendation. Ireland already has such rules and will engage with other Member States to ensure that we can agree a Directive which faithfully implements the BEPS recommendation in this area.
Finally, the review by an independent expert of Ireland’s corporation tax code which is currently underway will include consideration of what further actions Ireland may need to take to ensure we are fully compliant with the OECD BEPS recommendations.
250. Deputy Éamon Ó Cuív asked the Minister for Finance the cost of increasing the home carer's allowance for all families with children between six months and three years of age by €960 per annum; and if he will make a statement on the matter. [27276/17]
Amharc ar fhreagraI assume the Deputy is referring to the Home Carer Tax Credit. I am advised by Revenue that in 2014, the most recent year for which figures are available, the maximum amount of home carer tax credit available was €810 and the overall cost to the Exchequer for this credit was an estimated €60.9 million, in respect of 80,900 recipients. The Deputy will be aware that the home carer tax credit was increased to €1,000 in Budget 2016, and was further increased to €1,100 in Budget 2017.
As it is not possible to separately identify from Revenue records those who would benefit under the changes suggested by the Deputy (or to assess whether they would be in a position to absorb at least some of the additional credit), there is no basis on which to provide an estimated cost to the Exchequer of the Deputy’s proposal.
However, a Post-Budget 2017 Ready Reckoner is available on the Revenue website at http://www.revenue.ie/en/corporate/information-about-revenue/statistics/ready-reckoner/index.aspx. This Ready Reckoner shows a wide range of detailed information, including, on Page 6, the estimated cost to the Exchequer of changes to the home carer tax credit for all those currently availing of it.
251. Deputy Micheál Martin asked the Minister for Finance if his attention has been drawn to an investment fund (details supplied) and the excessive losses incurred by many customers of a bank (details supplied) who are of the view that they were over exposed unnecessarily and unethically to these losses by a bank; if this fund was covered by the Central Bank Act 1942; his plans to amend section 33 of this Act; and if he will make a statement on the matter. [27299/17]
Amharc ar fhreagra252. Deputy Micheál Martin asked the Minister for Finance if there have been specific banking regulations introduced to prevent bank customers from being overly exposed to investments (details supplied); and if he will make a statement on the matter. [27300/17]
Amharc ar fhreagra253. Deputy Micheál Martin asked the Minister for Finance his plans to investigate an investment fund (details supplied) in view of the number of persons who have suffered massive losses in cases in which higher than interest rates on loans were the norm; if his attention has been drawn to the overcharging by a bank (details supplied) on these funds; if his Department has received complaints from customers regarding same; and if he will make a statement on the matter. [27301/17]
Amharc ar fhreagra254. Deputy Micheál Martin asked the Minister for Finance if his attention has been drawn to personnel in a bank (details supplied) being disciplined for their involvement with selling or managing an investment fund (details supplied); and if he will make a statement on the matter. [27302/17]
Amharc ar fhreagraI propose to take Questions Nos. 251 to 254, inclusive, together.
I am aware of the matters relating to certain property investment funds that the Deputy has raised, which my officials will continue to monitor.
However, as litigation relating to a number of funds, including those identified by the Deputy, are currently before the courts, it would be inappropriate for me to comment at this time.
Speaking broadly I would point out that significant measures have been brought forward aimed at improving the transparency and appropriateness of investment products in the financial services industry. The Markets in Financial Instruments Directive (MiFID II) and the Markets in Financial Instruments Regulation (MiFIR) aim to strengthen the protection of investors by making financial markets more efficient, resilient and transparent. The framework also increases the supervisory powers of regulators and provide clear operating rules for all trading activities. The funds sector is being overhauled by the Alternative Investment Fund Managers Directive (AIFMD), which provides for the Europe-wide regulation of the management of collective investment schemes aimed at professional or qualified investors.
255. Deputy Barry Cowen asked the Minister for Finance the position regarding the taxation commission for landlords that his Department put in place after the introduction of rent pressure zones to examine landlords' cost base; when the report of this commission will be finalised; and if it will be made available to Members of the Houses of the Oireachtas for scrutiny prior to the budget. [27314/17]
Amharc ar fhreagraAs the Deputy will be aware, the Strategy for the Rental Sector, published by the Department of Housing, Planning, Community and Local Government in December 2016, committed to the establishment of a working group in early 2017 to examine and report on the tax treatment of landlords (or rental accommodation providers), and to put forward options, where appropriate, for amendments to such treatment. This working group was set up in January 2017, is chaired by the Department of Finance and its membership consists of officials from the Tax and Economics Divisions of the Department of Finance; the Revenue Commissioners; the Housing Division of the Department of Housing, Planning, Community and Local Government (DHPCLG); and the Residential Tenancies Board.
A public consultation lasting for four weeks was conducted from March to April 2017 and the consultation paper asked 10 targeted questions which covered subjects such as mortgage interest relief, capital repayment relief, rental accommodation as a pension investment, the deductibility of various expenses, Capital Gains Tax, long-term tenancies, accidental landlords, the Rent-a-Room Scheme and vacant properties. Individuals had the option to answer any, all, or none of the questions, when making their submissions. The consultation received almost 70 written submissions from a wide range of interested parties, including individual landlords, representative bodies and charitable organisations.
It is estimated that the report of the Working Group will be presented to the Minister for Finance by the end of July 2017, to allow for consideration of any of the options put forward, as part of his or her deliberations for Budget 2018. The normal convention with regard to such reports is that they are published on the budget website (www.budget.gov.ie) on Budget day in conjunction with all other Budget related information.
256. Deputy Barry Cowen asked the Minister for Finance his views on a reduction of VAT on residential construction to stimulate construction activity. [27316/17]
Amharc ar fhreagraVAT is governed by the EU VAT Directive, with which Irish VAT law must comply. While most economic activity is subject to the standard VAT rate of 23%, construction services already avail of the reduced VAT rate of 13.5%. Ireland has historically applied the 13.5% reduced rate of VAT to all construction services under a derogation from the EU VAT Directive.
The Programme for Partnership Government committed to ask the Oireachtas to consider the merits of a temporary targeted reduction of the rate of VAT from 13.5% to 9% on new, affordable houses and apartments, both public and private, timed to generate the maximum impact on supply and to target principally the purchasers of affordable homes.
In its Report of June 2016, the Oireachtas Committee on Housing and Homelessness reviewed the costs of construction including VAT, in the light of the Programme for Partnership Government commitment. They recommend that the Housing Agency annually review construction costs but did not recommend that the VAT rate on new residential property be reduced.
The ESRI reported in 2016 that any tax incentives aimed at developers are likely to have little effect on supply while other constraints are in place, such as stringent planning regulations, infrastructural constraints, and access to finance and building costs, including the impact of building regulations. In the presence of such constraints, the introduction of any tax incentive would likely lead to a transfer of tax revenue away from the State without any significant effect on supply.
With this in mind, ahead of last year's Budget I decided that relief would be better operated through the income tax rather than the VAT system. In this context I introduced the Help-to-Buy incentive in Budget 2017 to help encourage the building of additional new homes. That scheme will run until the end of 2019.
257. Deputy Barry Cowen asked the Minister for Finance the cost estimates for introducing a special 9% VAT rate on residential construction in budget 2018. [27319/17]
Amharc ar fhreagra287. Deputy Barry Cowen asked the Minister for Finance his views on introducing a 0% VAT rate on all renovations or alterations of empty residential premises as in the UK (details supplied). [27816/17]
Amharc ar fhreagra288. Deputy Barry Cowen asked the Minister for Finance the cost of introducing a 0% VAT rate on all renovations or alterations of empty residential premises as in the UK (details supplied). [27818/17]
Amharc ar fhreagraI propose to take Questions Nos. 257, 287 and 288 together.
The VAT rating of goods and services is subject to EU VAT law, primarily Council Directive 2006/112/EC, with which Irish VAT law must comply. The VAT Directive provides that Member States must apply a standard VAT rate at no lower than 15% and may apply two reduced rates between 5% and 15% to certain goods and services as listed in Annex III of the Directive. In addition, the Directive allows for historic VAT treatment to be maintained under set conditions. This allows for the continuation of the application of a zero rate or a rate less than 5% to goods or services where the rate applied on and from 1 January 1991. The zero rate of VAT cannot be applied to any new item. Similarly, the VAT Directive allows Member States to continue to exempt certain suppliers which were exempt on 1 January 1978 but the exemption cannot be applied to any new items.
As Ireland did not apply a zero rate of VAT to supplies of residential construction, or the renovation and alteration of empty residential premises on and from 1 January 1991, it is not legally possible to introduce a zero rate for these services. The UK can apply a zero VAT rate to the renovation and alteration of empty residential premises as they did so on and from 1 January 1991.
With regard to applying a 9% VAT rate to residential construction, I am advised by Revenue that it is tentatively estimated that introducing a 9% VAT rate specific to residential construction in Budget 2018 could cost in the region of €240m. This is based on the extrapolation of projections from a number of data sources, including residential completions, residential construction projects under current development and the average selling price of new residential homes.
258. Deputy Barry Cowen asked the Minister for Finance his views on whether it would be legally permissible and technically possible to implement a timed VAT reduction on residential construction that would by statue expire after a certain number of years as a means of stimulating construction activity. [27320/17]
Amharc ar fhreagra289. Deputy Barry Cowen asked the Minister for Finance further to Parliamentary Question No. 146 of 9 May 2017, the reason his Department is of the view that it is unfavourable to have two separate VAT rates applying to construction services, especially if the policy objective is to reduce the cost of one form of construction vis a vis another form in view of the high returns on commercial development compared to residential at present. [27819/17]
Amharc ar fhreagraI propose to take Questions Nos. 258 and 289 together.
VAT is governed by the EU VAT Directive, with which Irish VAT law must comply. While most economic activity is subject to the standard VAT rate of 23%. Construction services already avail of the reduced VAT rate of 13.5%. Ireland has historically applied the 13.5% reduced rate of VAT to all construction services under a derogation from the EU VAT Directive.
Applying a lower VAT rate to the construction of new residential properties would result in different VAT rates between residential and non-residential construction services, and it would also involve having different VAT rates between the construction of new homes and repair and maintenance work on those homes. This would be very difficult to administer and could lead to accidental or fraudulent underpayments of VAT.
The Programme for Partnership Government committed to ask the Oireachtas to consider the merits of a temporary targeted reduction of the rate of VAT from 13.5% to 9% on new, affordable houses and apartments, both public and private, timed to generate the maximum impact on supply and to target principally the purchasers of affordable homes. In its Report of June 2016, the Oireachtas Committee on Housing and Homelessness reviewed the costs of construction including VAT, in the light of the Programme for Partnership Government commitment. They recommend that the Housing Agency annually review construction costs but did not recommend that the VAT rate on new residential property be reduced.
The ESRI reported in 2016 that any tax incentives aimed at developers are likely to have little effect on supply while other constraints are in place, such as stringent planning regulations, infrastructural constraints, and access to finance and building costs, including the impact of building regulations. In the presence of such constraints, the introduction of any tax incentive would likely lead to a transfer of tax revenue away from the State without any significant effect on supply.
With this in mind, ahead of last year's Budget I decided that relief would be better operated through the income tax rather than the VAT system. In this context I introduced the Help-to-Buy incentive in Budget 2017 to help encourage the building of additional new homes. One of the main policy aims of the incentive is to assist a first-time purchaser fund the deposit required to purchase or self-build a new house or apartment to live in as their home.The other main aim of the policy is to help encourage the building of additional new properties. By restricting the initiative solely to new dwellings and new self-builds, it is anticipated that the resulting increase in demand for affordable new build homes should encourage the construction of an additional supply of such properties. The scheme will run until the end of 2019.
259. Deputy Frank O'Rourke asked the Minister for Finance the regulations with regard to peer to peer lending; if there is recourse for lenders in the event of borrower default; if there is protections for borrowers in the event of default; if there is regulation of the platforms; if there is regulation of the provision of a peer to peer loan; and if he will make a statement on the matter. [27321/17]
Amharc ar fhreagraAs the Deputy will be aware, peer-to-peer lending is a form of crowdfunding. Crowdfunding involves obtaining small amounts of funding from a large number of different sources, generally individuals but they can also be institutions. Peer-to-peer lending involves lenders providing money directly to borrowers as a loan that is to be repaid with interest through an online crowdfunding platform.
Crowdfunding is an innovative, technology-based form of finance that can be a valuable source of funding for SMEs, either as a complement, or as an alternative, to traditional bank finance. Crowdfunding can provide consumers and smaller investors with a higher rate of return, at a higher risk, than is generally available from deposits or traditional investments.
Crowdfunding, including peer-to-peer lending, is not currently a regulated activity in Ireland. Therefore, there is no regulation of crowdfunding platforms or the provision of peer-to-peer loans. Given this, there are no formal consumer protections available for borrowers using a peer-to-peer lending platform, including in the event of default. The Central Bank of Ireland has issued an information notice alerting consumers to this fact and the associated risks, available at:
https://www.centralbank.ie/consumer-hub/consumer-notices/consumer-notice-on-crowdfunding-including-peer-to-peer-lending
The European Commission has indicated that harmonised European regulation of crowdfunding is not anticipated at present.
The IFS 2020 2017 Action Plan commits the Government to conducting a public consultation on the potential regulation of crowdfunding, having regard to international best practice and in the context of the EU Commission Action Plan on Building a Capital Markets Union. My Department recently launched a public consultation on the regulation of crowdfunding that closed on 2nd June 2017.
My Department will now consider the submissions received from the public consultation and these will help inform my Department's policy position on whether or not a regulatory regime for crowdfunding would be appropriate and if a bespoke regime should be implemented in Ireland.
260. Deputy Michael McGrath asked the Minister for Finance if a dividend payment from NAMA to the Exchequer is treated as a financial transaction or if it improves the general Government balance; when he expects to receive a dividend from NAMA arising from the expected surplus; and if he will make a statement on the matter. [27360/17]
Amharc ar fhreagraNAMA expects to repay its outstanding guaranteed senior debt of €500m by the end of 2017 and to redeem its subordinated debt in March 2020. NAMA will focus on completing its ongoing deleveraging, its Dublin Docklands SDZ and residential funding programmes in the interim period to 2020. NAMA's 2016 Annual Report was laid before the Oireachtas on 1 June 2017 and provides further insight into the Agency's expectations regarding these activities. The report is also available on NAMA's website via: https://www.nama.ie/about-us/publications/annual-reports/.
It is through the successful completion of these objectives that NAMA anticipates a surplus in the region of €3bn (revised upwards from €2.3bn), which will be returned to the State once it completes it work.
As per section 60(2) of the NAMA Act 2009, NAMA may use surplus funds to redeem and cancel its debt. Surplus funds may only be returned to the Central Fund once NAMA's debt has been redeemed in full.
As has been discussed with Eurostat, from an accounting perspective, once the senior debt, subordinated debt, and private investors have been repaid then NAMA (the Agency), which is in Government, would be the sole shareholder and, as such, NAMA (the SPV) would then become classified into the Government sector. This is expected to occur in 2020, no later than the time at which the private shareholders have been fully compensated. At this point in time NAMA will have no debt.
As such, there is no impact on the general government balance.
261. Deputy Pearse Doherty asked the Minister for Finance if he will confirm media reports that there is €200 million in net fiscal space available for 2018 and €3 billion of fiscal space to 2021; and if he will make a statement on the matter. [27367/17]
Amharc ar fhreagraAs the Deputy is aware the most recent estimate of the net fiscal space available for 2018 is €1.2 billion (The gross fiscal space is €1.8 billion but €600 million of this is pre-committed spending in order to address factors including demographics). This figure was set out in the documentation that accompanied Budget 2017 last October. In answer to previous PQs, I have set out that the carryover cost of measures introduced in Budget 2017 amounts to c.€700 million, leaving c.€500 million available for allocation in Budget 2018 for tax and expenditure measures. The amount available for expenditure, based on an allocation of a 2:1 split between expenditure and taxes, as set out in the Programme for Government is to provide for both current and capital expenditure measures. The €200 million the Deputy refers to relates to an estimate of the amount available for current expenditure.
The estimated net fiscal space for the period 2019 to 2021 in Budget 2017 was c.€8.1 billion.
These estimates are consistent with compliance of Ireland's obligations under the fiscal rules, namely the expenditure benchmark pillar of the preventive arm of the Stability and Growth Pact. According to this metric, fiscal space is calculated as the potential growth rate of the economy (10-year average) less an appropriate margin which takes into account the fact that we have not yet achieved our medium term budgetary objective of a structural deficit of 0.5 per cent of GDP.
Fiscal space projections are based on a number of moving parts (GDP deflator, reference rates for potential growth, etc.) set each year by the European Commission. The Commission published these as part of its Spring Forecast and my officials are incorporating these into the updated calculations for fiscal space.
Furthermore the value for general government expenditure, including gross fixed capital formation, produced by the Central Statistics Office is an integral part of the calculation and can change when the National Income and Expenditure release is published in the summer. Given all these moving parts, I want to stress that the figures, as always, are work-in-progress estimates and will evolve over time.
The next estimate of the fiscal space for 2018 will be set out in the Summer Economic Statement 2017 published later this month.
262. Deputy Michael McGrath asked the Minister for Finance the amount of VAT and customs duty that would apply on the importation of a wheelchair for a person (details supplied) in County Cork from the United States of America. [27402/17]
Amharc ar fhreagraI am informed by Revenue that the person concerned will have no liability to customs duty or VAT on the importation of a wheelchair for his own use.
Electric wheelchairs are classified at tariff code 8713 90 00 00. The rate of customs duty for importation of electric wheelchairs from the United States of America is 0%. VAT on importation of the electric wheelchair is also 0% in accordance with paragraph 11(3) of Schedule 2 of the VATCA 2010 which provides that the zero rate of VAT applies to the supply of medical equipment including invalid carriages designed for use by invalids or infirm persons.
The wheelchair should be declared at importation using commodity code 8713 90 00 00.
263. Deputy Maureen O'Sullivan asked the Minister for Finance the adjustment which is made for indexation of income tax bands and income tax rates when calculating the fiscal space for budget 2018. [27418/17]
Amharc ar fhreagraAdditional revenue generated from a policy decision to not to proceed with indexation was included in the discretionary revenue measures set out in Table A7 Application of Expenditure Benchmark, on a no policy change from 2018 onwards in Annex 2 of? the Budget 2017 publication.
It was estimated that the total Exchequer yield in 2018 from non-indexation of the Income Tax and Universal Social Charge systems would yield c. €450 million, which would increase net fiscal space. This is made up of c. €65 million carryover from non-indexation in 2017 and c. €385m in the first year yield that should arise from proceeding with non-indexation in 2018.
The forthcoming Summer Economic Statement 2017, will set out up-to-date projections of fiscal space out to 2021. However, the cost of non-indexation in 2018, will not be finalised until the Revenue Commissioners have completed and published its Pre-Budget 2018 Income Tax Ready Reckoner, which is expected in Quarter 3 2017. In addition, the updated macroeconomic drivers used in these calculations will await the scheduled endorsement of the macroeconomic forecast by the Irish Fiscal Advisory Council in early October 2017.
264. Deputy Maureen O'Sullivan asked the Minister for Finance the expected revenue that would be generated from the restoration of the VAT rate for the hospitality sector from 9% to 13.5%. [27419/17]
Amharc ar fhreagra265. Deputy Maureen O'Sullivan asked the Minister for Finance the expected revenue that would be generated from the restoration of the VAT rate from 9% to 13.5% to the hotel industry (details supplied). [27420/17]
Amharc ar fhreagraI propose to take Questions Nos. 264 and 265 together.
I am informed by Revenue that it is tentatively estimated that the revenue generated from the restoration of the VAT rate from 9% to 13.5% is likely to be in the region of €490m for the hospitality sector as a whole and €190m specific to the accommodation sector, in both cases assuming no change in consumer behaviour.
266. Deputy Pearse Doherty asked the Minister for Finance the number of residential units in the possession of each of the State backed banks that are currently unoccupied; and if he will make a statement on the matter. [27436/17]
Amharc ar fhreagraThe information requested by the Deputy is not available within the Department of Finance.
As the Deputy is aware, the Relationship Framework agreements define the arm's-length nature of the relationship between the State and the banks in which the State has an investment, and as such each bank is individually and independently responsible for managing their stock of repossessed properties. As noted in the annual reports cited below, repossessed properties are offered for sale by the banks using external agents as soon as practicable.
AIB have informed me that it is AIB Bank policy to sell all residential assets on a vacant possession basis. All disclosures in relation to AIB’s residential mortgages – properties in possession can be found on page 109 of AIB’s Financial Report 2016, which can be found here: https://aib.ie/content/dam/aib/investorrelations/docs/resultscentre/annualreport/annual-financial-report-2016.pdf
PTSB have advised me that from the 1st January 2016 to the 31st Dec 2016, permanent tsb took possession of 116 properties; just 11 of these were a result of an Executed Order (i.e. a repossession achieved through the courts) while the remaining were properties which were either surrendered to the bank voluntarily by their owners or properties where the bank took repossession because it deemed the properties to be at risk (typically left vacant by owners). At the 31st December 2016 the bank had a total of 463 properties in its possession. These figures are reflected in the bank's 2016 annual report, available here: http://www.permanenttsbgroup.ie/~/media/Files/I/Irish-Life-And-Permanent/Attachments/pdf/2017/ptsbgh-full-year-report-2016.pdf
Bank of Ireland disclose information on properties in possession and repossessions disposed of for their Retail Ireland Mortgage portfolio on page 372 of their annual report. A link to the 2016 Bank of Ireland report is available here: https://investorrelations.bankofireland.com//wp-content/assets/BOI-Annual-Report-2016.pdf
I am firmly of the view that the Irish banking system has an important role to play in the normalisation of the Irish housing sector through the speedy return of properties in their possession to the general market. I am also conscious that where a bank comes into possession of a property the institution has a fiduciary responsibility to dispose of the property in a manner that satisfies its independent, commercial mandate. However I welcome the fact that this is now also happening through interaction with the Housing Agency, local authorities or other means.
I would also draw the Deputy's attention to the most recent mortgage arrears and repossession statistics released by the Central Bank: https://www.centralbank.ie/statistics/data-and-analysis/credit-and-banking-statistics/mortgage-arrears.
267. Deputy Pearse Doherty asked the Minister for Finance the composition of a matter the EU calls the VAT gap, the reduced or zero rates applicable and the cost attached to each instance by product or service; and if he will make a statement on the matter. [27437/17]
Amharc ar fhreagraThe VAT gap is an estimate comparing a maximum theoretical tax liability (approximated from economic activity in a country) against actual VAT collected. The difference arises due to a range of factors. These include revenue loss due to fraud and evasion. However, it also covers insolvencies, bankruptcies, administrative errors, legal tax optimisation as well as miscalculations.
Since 2009 the European Commission has hired consultants to estimate the VAT gap in each EU Member State. Given its nature, a tax gap cannot be easily or reliably measured. It must be estimated on the basis of limited data and making a number of assumptions. While Ireland has engaged with Commission on this topic, I am advised that Revenue has concerns around the robustness of the methodology used and the accuracy of the results. Notwithstanding these concerns, it is useful to note the overall trends. Ireland’s VAT gap is estimated at 9% for 2014 in the most recent study (published in 2016) and down from 13% for 2013. From an EU perspective the average VAT gap is estimated at 14.1% with Ireland ranking as the 8th lowest across Member States.
As well as the main VAT gap, the Commission also estimates the policy gap (an indicator of the additional VAT revenue that a Member State could theoretically, i.e. with perfect tax compliance, generate if a uniform VAT rate applied on all goods and services). Components of the policy gap include the loss in VAT liability due to the application of reduced rates and the loss in liability due to the implementation of exemptions. The Commission’s consultants estimate that Ireland has a 52.8% measure for the policy gap (VAT revenues would increase by 52.8% with the application of a uniform VAT rate to items that are exempt or zero rated, e.g. the provision of medical services, education, food, children's’ clothing and footwear, etc.). The EU average is 43.3%.
The VAT policy gap does not provide a detailed breakdown of the costs within each VAT rate or for VAT exempt activities. Essentially the policy gap measures the total revenue that would be collected if the standard VAT rate was applied to the supplies of all goods and services. For example, I am informed by Revenue that if the standard rate of VAT was applied to the supply of all zero-rated food items, the potential VAT revenue yields would be in the region of €1.5 billion.
268. Deputy Mick Wallace asked the Minister for Finance the contracts awarded to a company (details supplied) per annum since March 2011, in tabular form by his Department or agency or body under the aegis of his Department; the cost per contract; the basis for each contract; and if he will make a statement on the matter. [27452/17]
Amharc ar fhreagraMy Department has not awarded contracts to Accenture since March 2011. However, I am advised that two Bodies under my Department’s remit have provided positive returns in reply to the Deputy’s question. I shall outline their returns in tabular format as follows:
|
Body |
Contracts Awarded to Accenture per annum since March 2011 |
Cost per Contract |
Basis for each Contract |
|
Central Bank |
2011 Nil |
N/A |
N/A |
|
|
2012 No. S0001206 |
€398,020 (ex-vat) |
The Bank conducted a tender competition in accordance with Directive 2004/18/EC (OJEU Notice 2010/S 65-097832) for a Framework Agreement for the Provision of Organisational Development, Change Management Business Analysis and Information Management Support Services for the Central Bank of Ireland. Accenture was one of the firms appointed under Lot 3 - Provision of Business Process Management Services. Contract No. S0001206 was issued to Accenture on 12 March 2012 on conclusion of a mini-competition run under this Framework Agreement for Provision of Business Analysis Services to the Central Bank of Ireland. |
|
|
2013 No. S0001206 |
€64,262 (ex-vat) |
Details as above |
|
|
2014 Nil |
N/A |
N/A |
|
|
2015 Nil |
N/A |
N/A |
|
|
2016 No. S0001942 |
€204,270 (ex-vat) |
The Bank conducted a tender competition in accordance with Directive 2004/18/EC (OJEU Notice 2015/S 089-160377) for the supply of a Multiple-Supplier Framework Agreement for Software Development Lifecycle Services. Accenture was appointed as one of several framework participants to this Framework Agreement under contract No. S0001942 issued on 13 November 2015 |
|
|
2017 Nil |
N/A |
N/A |
|
Office of the Revenue Commissioners |
PROVISION OF EXTERNAL ICT RESOURCES AND SUPPORT 31st August 2010 – 29th November 2013 |
1st March 2013 – 29th November 2013 €9,726,407 |
Public Procurement in 2010 |
|
|
PROVISION OF EXTERNAL ICT RESOURCES AND SUPPORT 30th November 2013 – December 2016 |
2014 – €14,191,307 2015 – €11,122,437 2016 - €13,905,206 |
Public Procurement in 2013 |
|
|
PROVISION OF EXTERNAL ICT RESOURCES AND SUPPORT Jan 2017 to December 2018 (option to extend for 2 additional years) |
2017 to date: €8,948,090 |
Public Procurement in 2016 |
