Written Answers Nos. 173-190
174. Deputy Jackie Cahill asked the Minister for Finance the detail of the changes in the VAT rate for cookery schools between 2016 and 2018 from 0% to 21%; the rationale for this change in view of the fact that in most cases the activity is merely an addendum to the individual restaurant and in no way the main activity of the business; and if he will make a statement on the matter. [39556/18]
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. I am further advised that there has been no change in the position in relation to the VAT treatment of cookery schools.
In accordance with the VAT Directive, the provision of children’s or young people’s education and school or university education is exempt from VAT. This exemption also applies to the provision of training and development courses subject to the training and retraining being of a vocational nature. Where a cookery school is providing courses for educational or vocational purposes, any such course is exempt from VAT, provided the lessons in question are conducted as part of a programme that meets the standards set out by the Department of Education and Skills syllabus or, in the case of vocational training, the course is aimed at acquiring or updating knowledge in relation to a specific profession or trade.
Where a cookery school provides courses primarily for recreational purposes, the position continues to be that these courses are liable to VAT at the standard rate, currently 23%. A course which is primarily for recreational purposes is undertaken for the enjoyment and satisfaction of the participants rather than for developing skills and knowledge which will assist the participant in their trade or profession, and is therefore outside the scope of the education exemption.
When a business operates two activities, such as a restaurant which operates a cookery school, the tax rate applicable to the income derived from each activity is dependent on the actual supplies being made. In general, restaurant services are taxable at the 9% reduced rate and cookery courses are either exempt or taxable at the standard rate of 23%. If a cookery school has any doubt as to the eligibility for exemption of any of its courses, it should contact its local Revenue District for advice.
175. Deputy Micheál Martin asked the Minister for Finance the cost of each seminar held on Project Ireland 2040 up to and including September 2018 by his Department; and if he will make a statement on the matter. [39583/18]
Amharc ar fhreagraMy department did not hold any seminars in relation to Project Ireland 2040 and therefore did not incur any costs as a result.
176. Deputy Maurice Quinlivan asked the Minister for Finance his plans to introduce legislation to allow local authorities to introduce a transient occupancy tax on hotel rooms; and if he will make a statement on the matter. [39603/18]
Amharc ar fhreagraAs the Deputy will be aware, it is a longstanding practice of the Minister for Finance not to comment, in advance of the Budget, on any tax matters that might be the subject of Budget decisions.
177. Deputy Michael McGrath asked the Minister for Finance the breakdown of the €600 million quoted by the Irish Fiscal Advisory Council for the cost of tax indexation by tax heading, that is, income tax, USC, PRSI and so on and by tax measure, that is, tax bands, tax credits and so on; and if he will make a statement on the matter. [39618/18]
Amharc ar fhreagraI assume the figure the Deputy refers to is that which was published in the Irish Fiscal Advisory Council pre-Budget statement earlier this month. This is based on preliminary Department of Finance figures from Budget 2018. As the Deputy is aware from my recent response to Parliamentary Question No. 148 of September 25th, the expected yield on non-indexation for 2019 is being updated as part of the preparations for Budget 2019. When this figure is published it is on an aggregated basis. I am advised by Revenue that the Pre-Budget 2019 Ready Reckoner, available at: www.revenue.ie/en/corporate/documents/statistics/ready-reckoner.pdf, shows the cost to the Exchequer of a 1% indexation of a number of credits and bands in 2019 (page 10). Further changes can be estimated on a pro-rata basis from the information shown.
178. Deputy Catherine Murphy asked the Minister for Finance the amount spent by his Department on third party public relations advice, communications advice, online advertising and public awareness campaigns to date in 2018, by month and company engaged in tabular form; and if he will make a statement on the matter. [39639/18]
Amharc ar fhreagraIn relation to my Department the following expenditure has been made on the headings identified by the Deputy from 1 January 2018 to date:
|
Month |
Company |
Description |
Amount |
|
January |
Fiona Kearns Graphic Design |
Graphic Design for IFS2020 Action Plan for 2018 |
€1,240 |
|
January |
Fluid Branding |
Promotional material for public awareness building of SME online tool |
€3,860.90 |
|
January |
Languages Communication Ltd. |
Switch Your Bank campaign |
€51,414 |
|
February |
Languages Communication Ltd. |
Switch Your Bank campaign |
€177,427.50 |
|
March |
Languages Communication Ltd. |
Switch Your Bank campaign |
€153,442.50 |
|
April |
Languages Communication Ltd. |
Switch Your Bank campaign |
€12,915.00 |
|
July |
Languages Communication Ltd. |
Switch Your Bank campaign |
€7,380.00 |
|
August |
Public Appointment Service (PAS) |
Advertising costs Irish Times for Competition ref: appointments to Board of NAMA |
€1,706.70 |
The Switch Your Bank campaign is funded, in its entirety, by AIB and Permanent TSB, as part of a range of competition measures agreed with the European Commission to raise awareness and promote customer switching of financial products.
- The Department of Finance facilitates this campaign as part of its remit to ensure that consumers are protected within the financial sector in Ireland and to ensure a healthy level of competition.
- The contract with Language Communications permitted them to appoint subcontractors for provision of services.
- Phase one of the public awareness campaign cost €738,000 in total.
- Phase two of the public awareness campaign will cost €405,900 in total.
180. Deputy Clare Daly asked the Minister for Finance further to Parliamentary Question No. 147 of 25 September 2018, his plans to review the terms of the diesel rebate scheme in view of the rising costs of fuel for Irish hauliers. [39774/18]
Amharc ar fhreagraAs the Deputy will be aware, it is a longstanding practice of the Minister for Finance not to comment, in advance of the Budget, on any tax matters that might be the subject of Budget decisions.
181. Deputy Bríd Smith asked the Minister for Finance if allegations that a company (details supplied) has inflated expenses on a film production here in order gain a larger tax rebate under the section 481 tax clause will be investigated; if his Department or the Revenue Commissioners have audited or investigated companies that avail of this section in order to ensure that expenses and costs are correct; and if he will make a statement on the matter. [39921/18]
Amharc ar fhreagraI am advised by Revenue that they cannot comment on individual cases. However, they have provided the following general information in relation to the administration and review of claims for the film tax credit under Section 481, Taxes Consolidation Act 1997.
Under Section 481, in general terms a company which produces a film can claim a payable tax credit of 32% of the lower of:
(a) the eligible expenditure incurred on producing a film,
(b) 80% of the total cost of production of the film, or
(c) €70 million per film.
The maximum credit a company can claim in respect of a film is therefore €22.4million.
Eligible expenditure is the amount that the producer company spends in Ireland, wholly and exclusively on producing the film. Amounts spent on the film outside of Ireland do not qualify for the tax credit. However, where the credit is calculated based on 80% of the total cost of production, Revenue must have regard to the amounts incurred outside of the State as an increased global budget can lead to an increased credit.
The company that claims the credit must be an Irish producer company. The Irish work on the film must be carried out by a special purpose company which is wholly owned by that Irish producer company. Where the film is not a fully Irish production, for example it is a multi-jurisdictional production or a co-production, the Irish producer company will often organise the Irish production on behalf of an international production company. In those cases, it is the international production company who has full knowledge of the global budget and of the make-up of the items in the Irish budget.
Recognising the potential risks presented, the administrative framework of the relief requires that a company’s application for the credit must include:
(a) an auditor’s report detailing the eligible expenditure, the global budget and details of related party transactions, and
(b) a solicitor’s letter detailing that they have reviewed the legal agreements and that 68% of the funding has been lodged to the company’s bank account (a requirement prior to Revenue releasing any amounts of the payable tax credit).
The payable credit is available to a film that has been approved by the Minister for Culture, Heritage and the Gaeltacht and which has been certified by Revenue. Section 481 provides that Revenue may refuse to certify a film if they have reason to believe that the budget, or any part of the budget, is inflated. They may also refuse to certify the film if they are not satisfied with the commercial rationale for the corporate structure used for financing, distribution and other similar activities. As with all tax reliefs, the greatest risk of inflation is found in related party transactions including through corporate or financing structures that facilitate circular flows of cash.
I am further advised by Revenue that the time taken to process applications for relief under Section 481 has increased in the last year, largely due to increased scrutiny on the expenses included within the “eligible spend” in 481 applications. As the relief was restructured in 2015 from an investor-based relief to a corporation tax credit, the first films which have been made under this new format relief were being completed in 2017, which is when Revenue were first able to review the actual spend on completed films and the amounts being included in the claims for relief, as signed off upon by the auditors. The largest adjustments arising from this review process are in respect of inflated related party expenditures, and discussions are ongoing between my Department, Revenue and the Department of Culture, Heritage and the Gaeltacht in relation to options to protect the Exchequer and give greater clarity to producers claiming the credit.
182. Deputy Clare Daly asked the Minister for Finance further to Parliamentary Question No. 46 of 24 October 2017, if audit examinations have been carried out by the Revenue Commissioners to establish if there is still systematic excess of flat rate payments of VAT on input costs in the poultry sector. [39983/18]
Amharc ar fhreagraSection 86A of the VAT Consolidation Act 2010 was introduced in Finance Act 2016 to provide a mechanism for addressing situations where the business models in any agricultural sector allow for higher levels of flat-rate addition payments to be paid compared with the VAT borne on input costs.
I am advised by the Revenue Commissioners that, following the introduction of Section 86A of the VAT Consolidation Act 2010, a detailed examination of the business structures, models and contractual arrangements in place between parties within the sector was undertaken. Detailed examinations are being carried out on a statistically representative sample of flat-rate farmers operating in the poultry sector to determine if there is a systematic excess of the amount of flat-rate addition payments in the sector.
The first phase of interventions has been completed and a second phase of interventions will be completed shortly. At the conclusion of this examination, if there is evidence of overcompensation within that sector as a result of business structures and contractual arrangements, Revenue will complete a report to be submitted to my Department. Where, following this review, I am satisfied that there is a systematic excess of flat-rate addition payments over VAT on inputs incurred by flat-rate farmers in that sector, that sector may be excluded from the flat-rate scheme by way of Ministerial Order .
184. Deputy Michael McGrath asked the Minister for Finance the position regarding the application of withholding tax on peer to peer lending; the responsibilities of the SME receiving the lending and of the peer to peer lender in this regard; his views on whether there is merit in providing an exemption from withholding tax for peer to peer loans; and if he will make a statement on the matter. [39993/18]
Amharc ar fhreagraI am advised by Revenue that they have published guidance on the withholding tax obligations that arise in peer to peer lending. That guidance is published in Tax and Duty Manual 08-03-05 and is available on the Revenue website via the following link: https://www.revenue.ie/en/tax-professionals/tdm/income-tax-capital-gains-tax-corporation-tax/part-08/08-03-05.pdfThe purpose of the withholding tax is to facilitate tax compliance by providing a mechanism through which tax arising on the interest earned by the person lending the amounts to the company is collected. Where an individual makes a loan to a company, interest withholding will arise in respect of the interest element of loan repayments made by that company. The interest earned should then be declared by the individual lender, who may claim a credit for the tax withheld.
The provisions as described in the Tax and Duty Manual apply in situations where individuals make loans to companies in general, they are not specific to peer-to-peer lending platforms.
I am aware that representations have been made for differentiated treatment in respect of loans made via peer-to-peer lending platforms, in view of the multi-lender nature of loans via such platforms. However I would also note that peer-to-peer lending is as yet an unregulated activity in Ireland, and any consideration of withholding taxes will be informed also by broader policy considerations for the sector.
185. Deputy Maureen O'Sullivan asked the Minister for Finance when section 46 of the Finance Act 2015 will come into effect. [40079/18]
Amharc ar fhreagraI am informed by Revenue that this section was enacted to provide a legal basis for the development of IT systems in the excise sector for the electronic transmission of returns required under excise law. This section will be commenced on the completion of a number of developments that are underway.
As part of this approach, a new IT system was implemented in 2017 that enables traders in the mineral oil sector to make excise returns and payments electronically. This system will be extended to other excise sectors as IT developments permit.
In addition, it is intended that the existing EU – wide electronic system used by Revenue to monitor intra - EU movements of duty suspended excisable products will be extended to movements of duty suspended excisable products within the State. This will be implemented on foot of changes at EU level to the legal framework for this system that are currently being progressed.
186. Deputy Maureen O'Sullivan asked the Minister for Finance his plans to meet the president of the World Bank. [40080/18]
Amharc ar fhreagraI assume that the Deputy's question is in relation to the forthcoming Annual Meeting of the World Bank Group scheduled to take place from 12th to 14th October 2018 which, in my capacity as Ireland's Governor to the World Bank, I have been invited to attend.
Due to commitments in respect of Budget 2019 I shall not be in a position to attend this event and accordingly have no plans to meet World Bank Group President Jim Yong Kim. It may be of interest to the Deputy that Minister D'Arcy, who shall attend the World Bank Annual Meeting in my place, has no meetings scheduled with President Kim either.
187. Deputy Michael Healy-Rae asked the Minister for Finance if the concerns of an organisation (details supplied) will be addressed in budget 2019; and if he will make a statement on the matter. [40099/18]
Amharc ar fhreagraDecisions on the taxation matters referred to by the Deputy are made in the context of the annual Budget and Finance Bill process and the Deputy will understand that, with a week to go before Budget day, I cannot give any indications of my plans.
In relation to the Earned Income Credit, the Programme for a Partnership Government contains a commitment to increase the Earned Income Credit to €1,650. The Budget 2018 increase of €200 was a significant further step in that direction. The extent to which it may be possible to make further progress in this regard will depend on the overall resources available to me in the context of Budget 2019.
In relation to the farm deposit proposal and the proposed extension of income averaging, including the provision of an additional step out year, I have met with the organisation following receipt of its pre-Budget submission and I can assure him that all the proposals it has made are receiving detailed and careful consideration.
188. Deputy Charlie McConalogue asked the Minister for Finance the cost of his Department's stand at the National Ploughing Championships 2018; the number of staff deployed from his Department for the week; and the cost of same. [40353/18]
Amharc ar fhreagraMy Department did not have a stand at this year's National Ploughing Championship 2018 and did not deploy any staff to the event. As a result my Department did not incur any related costs.
189. Deputy Niall Collins asked the Minister for Public Expenditure and Reform the communications, press and public relations budget allocated to his Department for 2018; the way in which it is being spent; if it is behind or ahead of profile; and if he will make a statement on the matter. [39377/18]
Amharc ar fhreagraMy Department has no central subhead or budget for communications, press and public relations, as business units across the Department incorporate their limited requirements in this regard into the delivery of their programmes. The 2018 expenditure (to date) for these services are outlined in the table below.
|
Service Provider |
Purpose |
Expenditure |
|
Public Appointments Service |
Social Media advertising |
€553.50 |
|
MediaVest Limited |
Publication of notice of Minister’s approval of 29 Flood Risk Management Plans in Irish Times, Irish Independent and Irish Examiner |
€5,842.13 |
|
Media HQ |
Press releases |
€181.43 |
|
Film Mic Pro |
Audio recording App |
€33.98 |
|
Morrow Communications |
OGP – Communication advice on brand development |
€5,200.00 |
|
Morrow Communications |
OGP – Communication advice on design of pull up banners |
€480.00 |
|
Morrow Communications |
OGP – Communication advice on design of eInvoicing infographic and development of eInvoicing logo |
€1,710.00 |
|
Morrow Communication |
OGP – Communication advice on design of new PowerPoint presentations with new logo and branding. Design of new branded graphics for presentations. |
€2,430.00 |
|
Morrow Communication |
OGP – Communication advice for design of web banner, Category Management and Supplier registration form redesigned with new brand style and OGP Icons |
€750.00 |
|
Morrow Communication |
OGP – Communication advice for production, editing of eTenders animation for YouTube channel |
€12,449.00 |
|
Morrow Communications |
OGP – Communication advice for Tender Advisory Service (TAS) logo and leaflet design |
€2,335.00 |
Separately, a further €118,964 has been spent resourcing the Department's Press Office to date in 2018, of which most relates to staff salaries.
190. Deputy Billy Kelleher asked the Minister for Public Expenditure and Reform the status of the sixth meeting of the Labour Employer Economic Forum; the issues discussed; and the social partners and Government members present at the last meeting. [39528/18]
Amharc ar fhreagraThe Labour Employer Economic Forum (LEEF) was established in 2016 to bring together representatives of employers and trade unions with Government Ministers to exchange views on economic and employment issues as they affect the Labour Market and which are of mutual concern.
I chaired the sixth meeting of the LEEF, which took place on 27th August last. This meeting centred around initial progress reports from the four sub-groups to the LEEF which were established to facilitate ongoing engagement between employers and trade unions with relevant Government officials and Ministers. These Sub-Groups are based on a list of priority areas agreed by the LEEF members which are (i) pensions, (ii) employment legislation\regulation, (iii) housing and (iv) childcare. The list will be updated by agreement at the LEEF over time to reflect changing priorities. These issues are all highly relevant to the labour market and can be considered priority issues for all parties.
A detailed update on the status of BREXIT negotiations, (BREXIT forms a standing agenda item for the LEEF) was provided by the Tánaiste and Minister for Foreign Affairs and Trade, Simon Coveney T.D.
In attendance were representatives from IBEC, CIF, ICTU, INTO and Fórsa, the Tánaiste and Minister for Foreign Affairs, Simon Coveney T.D. and various senior Departmental officials.
