Written Answers Nos. 146-163
146. Deputy Eoin Ó Broin asked the Minister for Finance his views on the proposed sale by NAMA of the National Asset Residential Property Services DAC, NARPS, special purpose vehicle and the impact of a sale on the long-term security of tenure for the tenants of the 1,230 properties held by same. [21418/19]
Amharc ar fhreagraNational Asset Residential Property Services DAC (NARPS) is NAMA’s social housing special purpose vehicle (SPV) which has provided over 1,300 new units for social housing. NARPS operates by purchasing suitable properties for social housing from NAMA debtors and borrowers and then leasing onwards these properties to Local Authorities and Approved Housing Bodies, who then forward lease them on to individuals on social housing lists to occupy.
Any suggestion that NARPS or its underlying units are now being sold by NAMA is incorrect. There is no sales process underway or planned for a sale of the vehicle at this time.
NAMA is now approaching the wind down phase of its operations, and active consideration of its end-of-life strategy is underway. These considerations will be examined as part of my forthcoming Section 227 Review of NAMA. This review is required every 5 years under the NAMA Act to assess the extent to which NAMA has made progress towards achieving its overall objectives and to decide whether the continuation of the agency is necessary.
The Government is acutely aware of the pressing need for social housing in the State and any decision in respect of NARPS will be made with this in mind. Officials in my Department are in discussions with NAMA as how to best utilise NARPS to protect is social housing mandate post-2021 and I will make a final decision on how to best achieve this goal as part of the Section 227 Review process.
147. Deputy Seán Haughey asked the Minister for Finance the reason childminders working in domestic houses are treated as employees; the reason their employers must pay PRSI in respect of this employment; if tax relief for such expenses will be introduced; and if he will make a statement on the matter. [21495/19]
Amharc ar fhreagraI am advised by Revenue that there is no statutory definition of employment or self-employment in tax law. In general, an individual is an employee if he or she is directed by a person on how, when and where to work, has set working hours, has no personal financial risk relating to the work, receives a fixed wage, supplies labour only and cannot subcontract the work.
The question of whether an individual is engaged under a contract of service (an employee) or a contract for service (self-employed) is a question of fact and general law. To make a determination on employment or self-employment status the full terms of the contract and the circumstances in which it was made must be established.
Some years ago, the Employment Status Group published a Code of Practice for determining Employment or Self-employment status of Individuals. This Group included representatives from the Department of Finance, the Department of Employment Affairs and Social Protection and the Office of the Revenue Commissioners, amongst other public and private bodies. The Code of Practice is for guidance only and the employment status of an individual in relation to an engagement may in some instances fall to be determined by the Courts.
Where an individual is an employee, his or her salary or wages is chargeable to income tax under Schedule E and is subject to deductions under the PAYE system by his or her employer. The employer is obliged to pay a PRSI contribution for employees under the PAYE system. This employer contribution is paid for employees whose employment is insurable under the Social Welfare Acts.
Where an employee is employed by an individual solely on domestic duties, including childminding, in the employer’s home and is paid less than €40 per week, and the employer concerned has only one such employee, then, the domestic employer is not required to register as an employer for the purposes of the operation of the PAYE system of deductions. However, the employer is obliged to pay employer’s PRSI. The PRSI liability is payable by the employer in a single sum at the end of the tax year to the Special Collection Section of the Department of Employment Affairs and Social Protection.
I have no plans to introduce a specific income tax relief for parents to assist with childcare costs but the Government acknowledges the continuing cost pressures on parents, particularly those with young children.
In recognition of these cost pressures, there are already a number of support measures in place to ease the burden on working parents. These include various tax-exempted child-care related supports provided by the Minister for Children and Youth Affairs and measures such as the Working Family Payment provided by the Minister for Employment Affairs and Social Protection.
With regard to taxation measures, the Accelerated Capital Allowances scheme for Childcare Services was introduced to encourage employers to develop childcare facilities onsite for their employees. Also, there is tax relief for individuals who provide child-minding services in their own home, provided that they do not receive more than €15,000 income per annum from the child-minding income.
148. Deputy Michael McGrath asked the Minister for Finance if it is permissible under the codes of conduct and consumer protection of the Central Bank for a lender to charge legal fees to persons that are in arrears; if the Central Bank is in a position to cease this practice from occurring; and if he will make a statement on the matter. [21505/19]
Amharc ar fhreagraI have been advised by the Central Bank of Ireland that there are requirements in the Code of Conduct on Mortgage Arrears (CCMA) relating to the information which must be provided to borrowers about legal costs. These are as follows:
- Under Provision 14 of the CCMA, a lender must prepare and make available to borrowers an information booklet with details of its Mortgage Arrears Resolution Process (MARP), which must include with regard to legal proceedings, a statement that, irrespective of how the property is repossessed or disposed of, the borrower will remain liable for the outstanding debt, including any accrued interest, charges, legal, selling and other related costs, if this is the case.
- The borrower must also be reminded of the above information when three repayments have been missed (Provision 27), prior to being classified as not co-operating (Provision 28), where a lender is not willing to offer an alternative repayment arrangement due to concluding that the mortgage is unsustainable (Provision 45), and/or where the borrower is not willing to enter into an alternative repayment arrangement (Provision 47).
- Provision 27 of the CCMA also requires that where three mortgage repayments have been missed and remain outstanding, and an alternative repayment arrangement has not been put in place, the lender must notify the borrower of the potential for legal proceedings for repossession of the property where a borrower is not co-operating, together with an estimate of the costs to the borrower of such proceedings.
Also of relevance is that under Provision 14(1)(h) of the European Union (Consumer Mortgage Credit Agreements) Regulations 2016, the lender must make available to the borrower, on paper or another durable medium, “an indication of possible further costs, not included in the total cost of the credit to the consumer, to be paid in connection with a credit agreement.”
- In terms of existing provisions that are in place in the area of the imposition of charges or interest; provision 11 of the CCMA states that lenders are restricted from imposing charges and/or surcharge interest on arrears arising on a mortgage account in arrears, unless the borrower is not co-operating.
- Separately, under Provision 29(2) of the European Union (Consumer Mortgage Credit Agreements) Regulations 2016, any charge that a creditor may impose on a consumer arising from the consumer’s default “shall be no greater than is necessary to compensate the creditor for the costs it has incurred as a result of the default.”
Finally, the Central Bank has advised me that it is aware of the reported practice that some lenders apply legal costs to the mortgage accounts of borrowers in arrears before the conclusion of legal proceedings. The Central Bank is examining this practice to determine if it is permissible under the Code of Conduct on Mortgage Arrears (CCMA), the Consumer Protection Code 2012, and other regulations.
149. Deputy Bernard J. Durkan asked the Minister for Finance the extent to which his attention has been drawn to dramatic increases in insurance premiums affecting special needs and other schools, the result of which can only result in closure, in view of the extent of the insurance premium increase in some cases up to 300%; the specific steps he will take to address the issue; and if he will make a statement on the matter. [21523/19]
Amharc ar fhreagraI am aware of particular cases whereby there have been increases in insurance premiums affecting particular special needs schools. The Deputy will appreciate however that I am not able to comment on individual cases, as there may be factors relating to the case that I am not privy to, such as a change in the insurance policy that has led to an increase in the price, the existence of open claims, an increase in the level of claims in this general sector, etc.
That said, both I and the Minister of State for Financial Services and Insurance, Mr. Michael D’Arcy T.D., are very conscious of the difficulties that the cost and availability of insurance are having on many organisations such as businesses and community groups in this country. The Deputy should note that there is no policy or legislative ‘silver bullet’ to decrease the cost of insurance. This was also recognised by the Joint Oireachtas Committee on Finance and Public Reform, who reported on the issue in late 2016. This is a complex issue because for constitutional reasons the Government cannot direct the courts as to the award levels that should be applied and for legal reasons it cannot direct insurance companies as to the pricing level which they should apply in respect of businesses seeking insurance, as these matters are of a commercial nature, and are determined by insurance companies based on the risks they are willing to accept.
Notwithstanding this, I wish to reemphasise how important this issue is for the Government. Consequently, following the publication of its Report on the Cost of Motor Insurance in 2017, the Cost of Insurance Working Group undertook an examination of the employer liability and public liability insurance sectors. This second phase culminated in the publication in January 2018 of the Report on the Cost of Employer and Public Liability Insurance. Much work has been done to date through the implementation of both reports of the Cost of Insurance Working Group and achievements to date include:
- the establishment of the Personal Injuries Commission, and its subsequent recommendations relating to addressing award levels for soft tissue injuries;
- the Law Reform Commission (LRC) has commenced its work to undertake a detailed analysis of the possibility of developing constitutionally sound legislation to delimit or cap the amounts of damages which a court may award in respect of some or all categories of personal injuries, as part of its Fifth Programme of Law Reform;
- increasing transparency around the cost of private motor insurance through the establishment of the National Claims Information Database in the Central Bank;
- reforms to the Personal Injuries Assessment Board through the Personal Injuries Assessment Board (Amendment) Act 2019;
- amendments to Sections 8 and 14 of the Civil Liability and Courts Act 2004 to make it easier for businesses and insurers to challenge cases where fraud or exaggeration is suspected;
- the reform of the Insurance Compensation Fund to provide certainty to policyholders and insurers;
- various reforms of how fraud is reported to and dealt with by An Garda Síochána, including increased co-ordination with the insurance industry, collections of statistics under the new “insurance fraud” category which has been added to the PULSE system; as well as the launch recently of Operation Coatee, a co-ordinated operation to tackle insurance fraud; and,
- the Courts Service has confirmed that it will publish a more detailed breakdown of awards in personal injury cases in its Annual Reports.
I believe that these reforms are having a significant impact with regard to private motor insurance (CSO figures from April 2019 show that the price of motor insurance is now 24.4% lower than the July 2016 peak). The Government is determined to continue working to ensure that these positive pricing trends can be extended to other forms of insurance, including those relevant to businesses and voluntary groups.
Undoubtedly the single most essential challenge which must be overcome if there is to be a sustainable reduction in insurance costs is to bring the levels of personal injury damages awarded in this country more in line with those awarded in other jurisdictions. In this regard, the Personal Injuries Commission has highlighted the significant differential between award levels in this country and other jurisdictions, and has made a number of recommendations to address this issue, in particular the establishment of a Judicial Council to compile guidelines for appropriate general damages for various types of personal injury. Both I and Minister of State D’Arcy believe that this awards gap needs to be significantly closed and we are working with the Minister for Justice and Equality, Mr Charlie Flanagan TD, to ensure that this happens at the earliest opportunity.
Finally, I would like to assure the Deputy that the Cost of Insurance Working Group will continue to focus on implementing the recommendations of the Report on the Cost of Employer and Public Liability Insurance in parallel with implementing those from the Report on the Cost of Motor Insurance. I am hopeful that the cumulative effects of the completion of the two Reports’ recommendations will include increased stability in the pricing of insurance for businesses and voluntary groups and a more competitive insurance market.
150. Deputy John Brassil asked the Minister for Finance if he will review a decision by the Revenue Commissioners to refuse the home renovation incentive, HRI, to a person (details supplied); and if he will make a statement on the matter. [21524/19]
Amharc ar fhreagraS477B of the Taxes Consolidation Act 1997 provides for the Home Renovation Incentive (HRI), which terminated in accordance with its sunset clause on 31 December 2018.
With regard to the specific case raised by the Deputy, I am advised by Revenue that it has reviewed the person’s eligibility for HRI and, having considered the issues involved, is satisfied that she qualifies for the scheme.
The tax relief will be applied to the person’s salary over two years (2019 and 2020) in accordance with the rules of the scheme. A revised Revenue Payroll Notification, incorporating the relief for 2019, will issue to the person’s employer in the coming days. The relief, including any refund due for 2019, will be paid to the person once the revised instruction is input by her employer.
I am further advised that the person concerned has been contacted directly and the position has been explained to her.
151. Deputy Darragh O'Brien asked the Minister for Finance the value of loans issued by Home Building Ireland Finance, HBIF, to date; the number of homes anticipated from the loans; and if he will make a statement on the matter. [21529/19]
Amharc ar fhreagraHome Building Finance Ireland (HBFI) was established in December 2018 to lend money to small and medium sized builders and developers for commercially viable residential developments, particularly those situated outside the State's major urban centres. HBFI has been provided with access to €750 million of funding from the Irish Strategic Investment fund, with which it is expected to facilitate the delivery of 7,500 units over the next five years.
Since its formal launch at the end of January, HBFI has engaged actively with small and medium sized builders and developers throughout the country through a range of market awareness raising initiatives. HBFI continues to benefit from a strong pipeline of interest from prospective borrowers as a result of these engagement activities. The drawdown of funds relating to the first facilitates approved is expected to take place shortly with HBFI having approved a number of additional facilities since April.
As indicated in my response of 18th April, HBFI will be in a position to publish information on its lending activities on a half-yearly basis with the first such report to be published in July 2019.
152. Deputy Pearse Doherty asked the Minister for Finance the progress made on introducing a simplified process by which small and medium enterprises can avail of the research and development tax credit; and if he will make a statement on the matter. [21534/19]
Amharc ar fhreagraOn 29 April 2019 my Department launched a Public Consultation on the Research and Development Tax Credit, which is available at the following link:
https://assets.gov.ie/8279/f41bc90b2f1246f0a6e21ee5c0c7e7d3.pdf.
The Department of Finance’s October 2014 “Report on Tax Expenditures” set out Guidelines for best practice in ex ante and ex post evaluation of tax expenditures. In line with those guidelines, a review of the research and development tax credit is being undertaken in 2019. The purpose of this public consultation is to receive stakeholder input that may be used in the course of that review.
As the Deputy will recall, I also confirmed during debates on Finance Bill 2018 that the review would include consideration of matters specific to the accessing of the credit by SME companies. To that end the public consultation document includes a number of specific questions for SMEs and my officials are also examining SME-specific aspects of R&D tax credits in other jurisdictions.
The closing date for the public consultation is 7 June 2019 and I would encourage all interested parties to contribute to this process, to inform deliberations in advance of Budget 2020.
153. Deputy Catherine Martin asked the Minister for Finance his plans for insurance reform in relation to family adventure parks in view of the fact that insurance firms are repeatedly loading premiums ultimately resulting in the closure of such businesses and the loss of jobs; and if he will make a statement on the matter. [21539/19]
Amharc ar fhreagraBoth I and the Minister of State for Financial Services and Insurance, Mr. Michael D’Arcy T.D., are very conscious of the difficulties that the cost and availability of insurance are having on many businesses and community groups in this country. The Deputy should note that there is no policy or legislative ‘silver bullet’ to decrease the cost of insurance. This was also recognised by the Joint Oireachtas Committee on Finance and Public Reform, who reported on the issue in late 2016. This is a complex issue because for constitutional reasons the Government cannot direct the courts as to the award levels that should be applied and for legal reasons it cannot direct insurance companies as to the pricing level which they should apply in respect of businesses seeking insurance, as these matters are of a commercial nature, and are determined by insurance companies based on the risks they are willing to accept.
Notwithstanding this, I wish to reemphasise how important this issue is for the Government. Consequently, following the publication of its Report on the Cost of Motor Insurance in 2017, the Cost of Insurance Working Group undertook an examination of the employer liability and public liability insurance sectors. This second phase culminated in the publication in January 2018 of the Report on the Cost of Employer and Public Liability Insurance. Much work has been done in implementing both reports and achievements to date include:
- the establishment of the Personal Injuries Commission, and its subsequent recommendations relating to addressing award levels for soft tissue injuries;
- the Law Reform Commission (LRC) has commenced its work to undertake a detailed analysis of the possibility of developing constitutionally sound legislation to delimit or cap the amounts of damages which a court may award in respect of some or all categories of personal injuries, as part of its Fifth Programme of Law Reform;
- increasing transparency around the cost of private motor insurance through the establishment of the National Claims Information Database in the Central Bank;
- reforms to the Personal Injuries Assessment Board through the Personal Injuries Assessment Board (Amendment) Act 2019;
- amendments to Sections 8 and 14 of the Civil Liability and Courts Act 2004 to make it easier for businesses and insurers to challenge cases where fraud or exaggeration is suspected;
- the reform of the Insurance Compensation Fund to provide certainty to policyholders and insurers;
- various reforms of how fraud is reported to and dealt with by An Garda Síochána, including increased co-ordination with the insurance industry, collections of statistics under the new “insurance fraud” category which has been added to the PULSE system; as well as the launch recently of Operation Coatee, a co-ordinated operation to tackle insurance fraud; and,
- the Courts Service has confirmed that it will publish a more detailed breakdown of awards in personal injury cases in its Annual Reports.
I believe that these reforms are having a significant impact with regard to private motor insurance (CSO figures from April 2019 show that the price of motor insurance is now 24.4% lower than the July 2016 peak). The Government is determined to continue working to ensure that these positive pricing trends can be extended to other forms of insurance, including those relevant to businesses.
Undoubtedly the single most essential challenge which must be overcome if there is to be a sustainable reduction in insurance costs particularly for small businesses is to bring the levels of personal injury damages awarded in this country more in line with those awarded in other jurisdictions. In this regard, the Personal Injuries Commission has highlighted the significant differential between award levels in Ireland and other jurisdictions, and has made a number of recommendations to address this issue, in particular the establishment of a Judicial Council to compile guidelines for appropriate general damages for various types of personal injury. Both I and Minister of State D’Arcy believe that this awards gap needs to be significantly closed and we are working with the Minister for Justice and Equality, Mr Charlie Flanagan TD, to ensure that this happens at the earliest opportunity.
Finally, I would like to assure the Deputy that the Cost of Insurance Working Group will continue to focus on implementing the recommendations of the Report on the Cost of Employer and Public Liability Insurance in parallel with implementing those from the Report on the Cost of Motor Insurance. I am hopeful that the cumulative effects of the completion of the two Reports’ recommendations will include increased stability in the pricing of insurance for businesses and a more competitive insurance market.
154. Deputy Pearse Doherty asked the Minister for Finance the estimated cost of abolishing the local property tax and replacing the funding with central funds; and if he will make a statement on the matter. [21604/19]
Amharc ar fhreagra162. Deputy Pearse Doherty asked the Minister for Finance the estimated revenue which would yield from an annual vacant property tax of €2,000, €5,000 and €10,000, respectively. [21615/19]
Amharc ar fhreagra163. Deputy Pearse Doherty asked the Minister for Finance the estimated revenue that would be raised by introducing a non-principal private residence charge of €400 on properties indicated as such by owners in LPT returns and including commercial landlords but excluding local authorities and approved housing bodies. [21617/19]
Amharc ar fhreagraI propose to take Questions Nos. 154, 162 and 163 together.
I am advised by Revenue that as Local Property Tax (LPT) is forecast to collect €470 million in 2019, these receipts would be lost if the tax was abolished.
Regarding Question 21615/19, a residential property is liable for LPT if it is suitable for use as a dwelling, regardless of whether it is occupied or vacant. Therefore, the data Revenue holds on properties liable to LPT makes no distinction between those that are occupied or vacant and does not provide information on which to estimate the possible yield from the Deputy’s proposal.
Regarding Question 21617/19, I am informed by Revenue that LPT returns require owners to indicate whether their properties are principal or non-principal primary residences (NPPR). However, the information does not distinguish whether NPPR properties are owned by commercial landlords or otherwise. Page 25 of the Revenue Ready Reckoner, available at www.revenue.ie/en/corporate/documents/statistics/ready-reckoner.pdf, shows the yield that could be generated from imposing an additional flat charge on all NPPRs (Local Authority and Approved Housing Body owned properties are not included as NPPRs). While the calculation does not show the specific costing requested by the Deputy, the yield from a €100 per property charge is shown, and the yield from a €400 charge can be estimated on a pro-rata or straight-line basis.
155. Deputy Pearse Doherty asked the Minister for Finance the estimated revenue that would be raised by adding 50c of duty to a packet of 20 cigarettes with proportionate increases on other tobacco products. [21605/19]
Amharc ar fhreagraI am advised by Revenue that a Ready Reckoner, which shows the estimated tax yield that would arise from increases in Tobacco Products Tax, is published on the Revenue website at the following link: www.revenue.ie/en/corporate/documents/statistics/ready-reckoner.pdf.
156. Deputy Pearse Doherty asked the Minister for Finance the budgetary impact of freezing the phasing out of mortgage interest relief; and if he will make a statement on the matter. [21606/19]
Amharc ar fhreagraIt is assumed the Deputy is referring to mortgage interest relief for persons with a qualifying mortgage loan on a principal private residence. This relief is only available on a tapered basis for loans taken out between 2004 and 2012 and will end on 31 December 2020.
I am advised by Revenue that the estimated cost of the relief for 2019 and 2020 is €78m and €37m respectively.
The estimated maximum cost of maintaining the relief at the 2019 level in 2020 is approximately €41m and approximately €78m in 2021 and in subsequent years.
157. Deputy Pearse Doherty asked the Minister for Finance the estimated cost of restoring trade union tax relief at the level it was at before its abolition; and if he will make a statement on the matter. [21607/19]
Amharc ar fhreagraTax relief on trade union subscriptions was discontinued in 2011. I am advised by Revenue that there are no current data available from tax returns on the number of taxpayers with union subscriptions, the cost of individual union subscriptions, nor the ability of taxpayers to absorb the credit. Therefore, there is no basis for Revenue to estimate a cost for this measure.
The cost of the relief up to its abolition was as follows:
|
Year |
Exchequer Cost (€m) |
Uptake |
|
2010 |
26 |
337,500 |
|
2009 |
26.7 |
345,800 |
|
2008 |
26.4 |
341,900 |
|
2007 |
20.7 |
316,300 |
A review of the appropriate treatment for tax purposes of trade union subscriptions and professional body fees was carried out by my Department in 2016, and included in the 2016 report on tax expenditures published on Budget day 2016.
www.budget.gov.ie/Budgets/2017/Documents/Tax_Expenditures_Report%202016_final.pdf.
The review concluded that:
"...analysis of the scheme using the principles laid down by the Department’s Tax Expenditure Guidelines shows that it fails to reach the evaluation threshold to warrant introduction in this manner.
The reinstatement of this tax relief would have no justifiable policy rationale and does not express a defined policy objective. Given that individuals join trade unions largely for the well-known benefits of membership, and the potential value of the relief to an individual would equate to just over €1 per week, this scheme would have little to no incentive effect on the numbers choosing to join. There is no specific market failure that needs to be addressed by such a scheme, and it would consist largely of deadweight."
Given the conclusion of the review, I have no plans to reintroduce such a relief.
158. Deputy Pearse Doherty asked the Minister for Finance the estimated cost of increasing the earned income credit to the same level as the PAYE credit; and if he will make a statement on the matter. [21608/19]
Amharc ar fhreagraI am advised by Revenue that estimated costs for increases to the Earned Income Credit are available on page 6 of the Revenue Ready Reckoner, which is available on the Revenue website at www.revenue.ie/en/corporate/documents/statistics/ready-reckoner.pdf.
Amounts other than those shown can be extrapolated using a straight line or pro-rata calculation. On that basis, the cost of increasing the Earned Income Tax Credit by €300 from the current level of €1,350 to €1,650 is €40 million in the first year and €72 million in a full year.
159. Deputy Pearse Doherty asked the Minister for Finance the estimated cost of introducing a tax relief of 8.33%, that is equivalent to one month's rent for rent paid by all renters not in receipt of other State assistance on a refundable basis. [21609/19]
Amharc ar fhreagraThe rent relief tax credit was abolished in Budget 2011 and is no longer available to those that commenced renting for the first time from 8 December 2010. This followed a recommendation in the 2009 report by the Commission on Taxation that rent relief should be discontinued. The view of this independent commission was that, in the same manner in which mortgage interest relief increases the cost of housing, rent relief increases the cost of private rented accommodation.
I am advised that there is no reliable basis available to Revenue on which to estimate the potential cost of the introduction of a tax relief as described by the Deputy.
The annual cost of such a tax credit, operating on a refundable basis, would depend on the number of those renting, other than those who are in receipt of rental support from the State, and the amount of rent paid by them each year.
According to Census 2016 data, the private rented sector amounts to approximately 310,000 units. This figure includes those in receipt of rental support from the State.
It is clear, therefore, that the costs involved would be likely to be very significant.
160. Deputy Pearse Doherty asked the Minister for Finance the estimated overall cost or gain of decreasing the research and development credit to 15% and 20%, respectively, generally but increasing it to 30% for SMEs. [21610/19]
Amharc ar fhreagra161. Deputy Pearse Doherty asked the Minister for Finance the estimated cost of increasing the research and development credit for SMEs to 30%. [21611/19]
Amharc ar fhreagraI propose to take Questions Nos. 160 and 161 together.
I am advised by Revenue that statistical information in respect of the Research & Development credit is available at link www.revenue.ie/en/corporate/information-about-revenue/statistics/tax-expenditures/index.aspx for all years up to 2017.
Information on likely future expenditure on research and development is not available. However, based on information included in the 2017 Corporation Tax returns in respect of research & development claims and associated refundable credits for SMEs (defined here as companies with less than 250 employees), the estimated cost of increasing the credit to 30% is in the region of €32 million.
On the same basis, the estimated gain from increasing the rate to 30% for SMEs and decreasing the rate to 20% for other companies is in the region of €26 million. The estimated gain from increasing the rate to 30% for SMEs and decreasing the rate to 15% for other companies is in the region of €84 million.
A review of the research and development tax credit is being undertaken by my Department in 2019. This review will examine the interaction of SMEs with the credit as part of its scope.
