Dáil Éireann Debate, Tuesday - 24 July 2018
224. Deputy Thomas P. Broughan asked the Minister for Finance the expected yield if the tax refund element of research and development tax credits was removed; and if he will make a statement on the matter. [33486/18]
Amharc ar fhreagra275. Deputy Michael McGrath asked the Minister for Finance the annual cost of the research and development tax credit for the previous five years including 2017; the number of companies that have availed of the scheme in each of these years by multinational companies and SMEs; and if he will make a statement on the matter. [33921/18]
Amharc ar fhreagra339. Deputy Joan Burton asked the Minister for Finance the value of payable refundable research and development tax credits paid out by the Revenue Commissioners in each of the years 2009 to 2017 to companies that did not pay corporation tax in those years; the estimated refunds or payable amounts to be paid out in 2018; the cost of the research and development tax credit in each of those years; and if he will make a statement on the matter. [34873/18]
Amharc ar fhreagra340. Deputy Joan Burton asked the Minister for Finance the outstanding liability from refundable payable research and development credits; and if he will make a statement on the matter. [34874/18]
Amharc ar fhreagra341. Deputy Joan Burton asked the Minister for Finance the projected savings in 2019 if the research and development tax credit was no longer refundable or payable; and if he will make a statement on the matter. [34875/18]
Amharc ar fhreagra342. Deputy Joan Burton asked the Minister for Finance the number of companies that claimed payable refundable research and development tax credits in each of years 2009 to 2017 and to date in 2018; the highest refund paid out in each year; the average value of a refund in each year, in tabular form; and if he will make a statement on the matter. [34876/18]
Amharc ar fhreagra343. Deputy Michael McGrath asked the Minister for Finance the full-year cost of allowing up front refunds under the research and development tax credit for young SME companies four years old or younger; and if he will make a statement on the matter. [34894/18]
Amharc ar fhreagra346. Deputy Michael McGrath asked the Minister for Finance the full-year cost of increasing the portion of expenses allowed for deduction under the research and development tax credit from 25% to 30% for SME companies; and if he will make a statement on the matter. [34897/18]
Amharc ar fhreagraI propose to take Questions Nos. 224, 275, 339 to 343, inclusive, and 346 together.
I am advised by Revenue that information in respect of the annual cost of the Research and Development (R&D) credit is available at https://www.revenue.ie/en/corporate/information-about-revenue/statistics/tax-expenditures/r-and-d-tax-credits.aspx for all years up to 2016.
The document includes information in respect of refundable tax credits but estimates of refunds for future years are not available. Information in respect of outstanding liability is also not available but it may be useful for the Deputy to be aware that the document includes the amounts converted to first, second and third payable credit for all years up to 2016.
|
Year |
Total Exchequer Cost(€m) |
Number of Companies |
|
2009 |
216 |
900 |
|
2010 |
224 |
1,172 |
|
2011 |
261 |
1,409 |
|
2012 |
282 |
1,543 |
|
2013 |
421 |
1,576 |
|
2014 |
553 |
1,570 |
|
2015 |
708 |
1,535 |
|
2016 |
670 |
1,506 |
It is not possible to accurately show the yield if the R&D tax credit was no longer payable as information in respect of current expenditure is not available. On the basis of claims from 2016 tax returns, it is tentatively estimated that the full year gain from abolishing the refundable credits aspect of the research and development tax credit could be in the region of €240m. However, the information in respect of payable credits in the document may be of interest to the Deputy.
Due to Revenue’s obligation to observe confidentiality for taxpayer information it is not possible to show the highest refund. The average refund associated with the refundable credit aspect of the relief for the years 2010 to 2016, the latest years available, is as shown in the following table.
|
Year |
Average Refund € |
|
2010 |
91,100 |
|
2011 |
115,450 |
|
2012 |
127,900 |
|
2013 |
215,650 |
|
2014 |
305,400 |
|
2015 |
349,450 |
|
2016 |
230,480 |
It is not possible to show the full year cost of allowing up-front refunds under the Research and Development tax credit for young SME companies four years old or younger as information in respect of future expenditure by young SME companies is not available.
Similarly it is not possible to show the cost of increasing the portion of expenses allowed for deduction under the Research and Development tax credit from 25% to 30% for SME companies as information in respect of future expenditure by SMEs is not available. However I am advised by Revenue that, based on claims in respect of the research and development tax credit included in 2016 tax returns, the estimated tax cost of increasing the rate to 30% for SMEs could be in the region of €30 million in a full year. This cost assumes no behavioural change.
It may be of interest to the Deputy to note that the published document on the Revenue website shows the tax costs for all years by number of employees. Employee numbers can be used as a measure as to whether or not a business is an SME, as a business with less than 250 employees is generally considered to be an SME.
