Wednesday, 25 Sep 2019

Written Answers Nos. 51-67

Ministerial Meetings

Ceisteanna (51)

Seán Crowe

Ceist:

51. Deputy Seán Crowe asked the Tánaiste and Minister for Foreign Affairs and Trade if a report will be provided on his meeting with the Colombian Minister of Foreign Affairs in Dublin on 17 September 2019; if he offered further support from Ireland to the Colombian peace process; if concerns were raised regarding the increase in attacks and assassination of social and political leaders in Colombia; if he shared his concern that the attacks and assassinations are happening with impunity and undermining the peace process; and if he raised concerns with the minister regarding human rights abuses and environmental degradation at the Cerrejón coal mine, which provides a significant amount of coal for Moneypoint power station, County Clare. [38953/19]

Freagraí scríofa

Tánaiste and Minister for Foreign Affairs and Trade

I was very pleased to welcome Minister of Foreign Affairs of Colombia, H.E. Carlos Holmes Trujillo García, to Dublin last month. This visit was a demonstration of the excellent bilateral relations between Ireland and Colombia, which have been going from strength to strength since the recent opening of our respective Embassies in Bogotá and Dublin. Foreign Minister Trujillo also had an opportunity to meet with members of this House during an appearance before the Joint Committee on Foreign Affairs and Trade.

My meeting with Foreign Minister Trujillo was an opportunity to take stock of this important relationship and to discuss priorities moving forward. There is significant cooperation between our two countries in a number of areas, as demonstrated by the visits last month of a number of Colombian state agencies to Ireland. We discussed this cooperation and the areas on which we will continue to focus, such as trade, investment, agriculture, science, research, innovation and cooperation at the multilateral level.

I also underlined the ongoing support of Ireland to Colombia in the implementation of its peace agreement, including dealing with setbacks arising from violence. I assured Minister Trujillo that we see our partnership with Colombia in sharing experience of peace-building as a long term commitment. We agreed that we had much to learn from each other as we strive to build and maintain peace in our two countries.

Ireland has contributed more than €14 million in support of the peace process in Colombia since 2007, mainly channelled through the United Nations, and Colombian and international NGOs focusing on human rights, conflict prevention, peace-building and supporting livelihoods for rural populations.

We will continue to provide support to the Colombian peace process through funding to international organisations, but also through lesson sharing programmes between Ireland and Colombia, based on our own experience of peace building on this island.

My Department supported the travel of three experts from Northern Ireland to Colombia in June to engage with the Government on key elements of the peace agreement and its implementation. Officials at my Department in Dublin were also pleased to meet last month with Dr. Emilio Archila, Presidential Counsellor for Stabilisation and Consolidation of Colombia, who is responsible for the implementation of the peace accords.

The peace process is fundamental to improving the human rights situation in the country, which I am aware is difficult for many human rights defenders across Colombia, including those in La Guajira region protesting the practices of the Cerrejón mine. Officials at our Embassy in Bogotá are due to travel to La Guajira region this week to meet with relevant stakeholders, including human rights defenders, civil society organisations, and representatives of the private sector in the area, including the Cerrejón mine. I look forward to receiving the report of this visit. I have also written to the CEO of the ESB requesting further information on their dealings with Cerrejón.

Ireland remains committed to supporting the full implementation of the peace accords in Colombia to ensure a more peaceful future for all Colombians. We will continue to work with the Government of Colombia and with our EU partners to ensure a coordinated and effective approach that best supports the peace process.

Passport Applications Data

Ceisteanna (52)

Niall Collins

Ceist:

52. Deputy Niall Collins asked the Tánaiste and Minister for Foreign Affairs and Trade the number of first-time applicants for an Irish passport from Great Britain and Northern Ireland in each of the years 2014 to 2018 and to date in 2019, in tabular form; and if he will make a statement on the matter. [38983/19]

Freagraí scríofa

Tánaiste and Minister for Foreign Affairs and Trade

The numbers of first time passport applications received from applicants who were resident in Great Britain and Northern Ireland at the time of application for the years 2014 to 2018 and to date in 2019 are detailed in the table below.

Year	-	-
2014	5,672	18,067
2015	6,011	20,325
2016	18,263	29,923
2017	31,675	40,089
2018	39,287	40,226
2019*	36,274	49,243

* to 31 August 2019

All passport applications are subject to the provisions of the Passports Act, 2008, as amended. The Passports Act provides, among other things, that a person must be an Irish citizen before a passport can be issued to him or her. Entitlement to Irish citizenship is governed by Irish law and in particular the Irish Nationality and Citizenship Act 1956, as amended.

VAT Rate Reductions

Ceisteanna (53)

Jonathan O'Brien

Ceist:

53. Deputy Jonathan O'Brien asked the Minister for Finance if VAT can be reduced on bicycles to 13.5% or 9%; the estimated associated cost with such a change; and if he will make a statement on the matter. [38919/19]

Freagraí scríofa

Minister for Finance

I am advised by Revenue that the VAT rating of goods and services is subject to EU VAT law, with which Irish VAT law must comply. In accordance with the VAT Directive the supply of bicycles is liable to VAT at the standard rate, currently 23%. It is not possible under Annex III of the VAT Directive to apply a reduced VAT rate to bicycles.

Financial Services Regulation

Ceisteanna (54)

Michael McGrath

Ceist:

54. Deputy Michael McGrath asked the Minister for Finance further to Parliamentary Question No. 63 of 6 September 2019, the process by which an unauthorised financial services provider can be fined by a court following conviction; the person or body whose role it is to take proceedings to court in order to impose a fine on an unauthorised financial services provider; if it is a matter for the Director of Public Prosecutions or the Central Bank; if the Central Bank needs to report the instance to the Director of Public Prosecution for consideration; if so, the number of cases since 2015 that have been reported to the Director of Public Prosecutions; the number of cases that have been taken by the Director of Public Prosecutions to the courts since 2015; and if he will make a statement on the matter. [38943/19]

Freagraí scríofa

Minister for Finance

I am advised by the Central Bank that the Bank or the Director of Public Prosecutions (DPP) can take a summary prosecution for unauthorised activity. However, the Central Bank does not have the power to take prosecutions on indictment, which typically attract more significant penalties. This power rests solely with the DPP.

Fines are imposed by a Court once an unauthorised provider has been convicted at the conclusion of a criminal trial, and are assessed by a trial judge. The fines that a Court can impose depend on the provisions of the legislation governing the particular category of unauthorised activity that the financial services provider is convicted under.

The Central Bank has statutory reporting obligations to An Garda Síochána to report information which leads it to suspect that a criminal offence has been committed. The Central Bank has stated that it takes these obligations very seriously and complies with them on an ongoing basis as appropriate. The Central Bank cannot comment on or provide any details in relation to the substance of those reports or the outcomes. The Central Bank keeps the consideration of potential criminality under constant review in the context of unauthorised providers of financial services.

Information in relation to the number of cases that have been taken by the DPP to the courts since 2015 is a matter for my colleague the Minister for Justice and Equality.

Tax Code

Ceisteanna (55)

Michael McGrath

Ceist:

55. Deputy Michael McGrath asked the Minister for Finance if a matter raised in correspondence by a person (details supplied) in County Cork regarding the tax treatment of unmarried couples will be addressed; and if he will make a statement on the matter. [38948/19]

Freagraí scríofa

Minister for Finance

Where a couple is cohabiting, rather than married or in a civil partnership, each partner is treated for the purposes of income tax as a separate and unconnected individual. Because they are treated separately for tax purposes, credits, tax bands and reliefs cannot be transferred from one partner to the other. Cohabitants do not have the same legal rights and obligations as a married couple or couple in a civil partnership which is why they are not accorded similar tax treatment to couples who have a civil status that is recognised in law.

The basis for the current tax treatment of married couples derives from the Supreme Court decision in Murphy vs. Attorney General (1980). This decision was based on Article 41.3.1 of the Constitution where the State pledges to protect the institution of marriage. The decision held that it was contrary to the Constitution for a married couple, both of whom are working, to pay more tax than two single people living together and having the same income.

The treatment of cohabiting couples for the purposes of social welfare is primarily a matter for my colleague, the Minister for Employment Affairs and Social Protection, Ms Regina Doherty, T.D. However, it is also based on the principle that married couples should not be treated less favourably than cohabiting couples. This was given a constitutional underpinning following the Supreme Court decision in Hyland v Minister for Social Welfare (1989) which ruled that it was unconstitutional for the total income a married couple received in social welfare benefits to be less than the couple would have received if they were unmarried and cohabiting.

To the extent that there are differences in the tax treatment of the different categories of couples, such differences arise from the objective of dealing with different types of circumstances while at the same time respecting the constitutional requirements to protect the institution of marriage.

Further, I have been advised by Revenue that, from a practical perspective, it would be very difficult to administer a regime for cohabitants which would be the same as that for married couples or civil partners at this time. This is because married couples and civil partners have a verifiable official confirmation of their status and it would be difficult, intrusive and time-consuming to confirm declarations by individuals that they were actually cohabiting.

Therefore, any change in the tax treatment of cohabiting couples can only be addressed in the broader context of future social and legal policy development in relation to such couples.

Tax Reliefs Availability

Ceisteanna (56)

Michael McGrath

Ceist:

56. Deputy Michael McGrath asked the Minister for Finance his views on removing the restriction in which tax relief is only available for physiotherapy sessions on the basis of a general practitioner referral; and if he will make a statement on the matter. [38980/19]

Freagraí scríofa

Minister for Finance

Tax relief in respect of health expenses is provided for in section 469 of the Taxes Consolidation Act 1997. Health expenses is defined in that section as "expenses in respect of the provision of health care…including the services of a practitioner…".

A practitioner is defined in the section as "any person who is–

(A) registered in the register established under section 43 of the Medical Practitioners Act 2007,

(B) registered in the register established under section 26 of the Dentists Act, 1985, or,

(C) in relation to health care provided outside the State, entitled under the laws of the country in which the care is provided to practice medicine or dentistry there".

In the case of physiotherapy, relief can only be allowed in circumstances where the practitioner administering the therapy is a qualified practitioner as defined above, or if the treatment has been prescribed by a practitioner.

Treatment by a physiotherapist is dealt with in the same way as other treatments for health purposes in that to obtain relief the treatment must come within the terms of the section.

I do not intend changing the policy in relation to this matter at this time, but if the Deputy is aware of any unintended hardship that is being caused by this restriction I will arrange to give it due consideration.

Further details in relation to relief for health expenses are available on the Revenue website: https://www.revenue.ie/en/personal-tax-credits-reliefs-and-exemptions/health-and-age/health-expenses/what-are-qualifying-expenses.aspx

Tax Code

Ceisteanna (57)

Michael McGrath

Ceist:

57. Deputy Michael McGrath asked the Minister for Finance the treatment of off-road voluntary ambulances for the purposes of VRT, VAT and annual motor tax; the way in which the treatment differs from regular voluntary ambulances; the estimated cost if the rules for off-road ambulances were equalised with those of regular ambulances; and if he will make a statement on the matter. [39056/19]

Freagraí scríofa

Minister for Finance

I am informed by Revenue that section 130 of the Finance Act 1992 provides the definition of an ambulance for the purposes of registration and VRT. An ambulance must be type approved under the type-approval framework directive, Directive 2007/46/EC, and must meet the technical criteria in Annex XI of that directive to come within the scope of the registration provisions. This includes criteria that must be met under the provisions of CEN 1789:2007, the European standard specifying requirements for the design and equipping of ambulances used for the transport and care of patients. A vehicle that is declared as an ambulance will only be registered as a VRT category D vehicle (at a zero rate of VRT) if it has the requisite type approval. More detailed information is available on the Revenue website at the following link: https://www.revenue.ie/en/importing-vehicles-duty-free-allowances/guide-to-vrt/conversions/specific-vehicles.aspx.

I am further informed by Revenue that the VAT rating of goods and services is subject to EU VAT law, with which Irish VAT law must comply. In general, the VAT Directive provides that all goods and services are liable to VAT at the standard rate unless they fall within categories of goods and services specified in the Directive in respect of which Member States may apply a lower rate or exempt from VAT. The supply of an ambulance is not included in any of those categories. However, the Disabled Drivers and Disabled Passengers Scheme provides for a refund of VAT and VRT on the purchase of an ambulance for transport of a disabled person or persons within the terms of the Disabled Drivers and Disabled Passengers (Tax Concessions) Regulations. The scheme is open to organisations who fall within the definition of “qualifying organisations” where their purpose is to provide services to persons with a disability (within the meaning of the Disability Act 2005) and is engaged in the care and transport of a person or persons with a disability.

Under the Charities VAT Compensation Scheme, charities which are registered with the Charities Regulator can claim for VAT on any expenditure incurred in relation to their charitable activities, except where the charity is already entitled to a refund, deduction, relief or repayment of that VAT. Under this scheme the applicant is entitled to claim a proportion of their VAT costs based on the level of non-public funding they receive. For example, if 70% of their income comes from non-public funds they may claim back 70% of the eligible VAT incurred. However, as there is a capped amount of funding available annually under the scheme, charities will be paid on a pro-rata basis where the total amount of claims received exceeds the cap. The scheme has closed for this year and will re-open in January 2020 in respect of expenditure incurred in 2019.

Mortgage Arrears Rate

Ceisteanna (58, 59)

Joan Burton

Ceist:

58. Deputy Joan Burton asked the Minister for Finance if an analysis will be provided of mortgage holders in arrears by age groups (details supplied). [39063/19]

Joan Burton

Ceist:

59. Deputy Joan Burton asked the Minister for Finance if an analysis will be provided of mortgage holders by age groups (details supplied) in tabular form. [39064/19]

Freagraí scríofa

Minister for Finance

I propose to take Questions Nos. 58 and 59 together.

I have been advised by the Central Bank of Ireland (the Central Bank) that they are unable to provide the information requested in both Parliamentary Questions, in the allotted timeframe. The Central Bank have informed me that the information is not readily available and will require a detailed analysis of data. I will write to the Deputy as soon as I get a response from the Central Bank.

Tax Reliefs Data

Ceisteanna (60, 61, 62, 63)

Joan Burton

Ceist:

60. Deputy Joan Burton asked the Minister for Finance if he will provide statistical information (details supplied) in respect of each of the years 2010 to 2018 and from 1 January 2019 to date. [39065/19]

Joan Burton

Ceist:

61. Deputy Joan Burton asked the Minister for Finance the number of correlative adjustments received by the country in which the tax settlement giving rise to the adjustment has been agreed in each of the years 2010 to 2018 and from 1 January to date in 2019, in tabular form. [39066/19]

Joan Burton

Ceist:

62. Deputy Joan Burton asked the Minister for Finance the number of protective claims for correlative adjustments received for claims that may arise in the future together with an estimate of the tax involved in each of the years 2012 to 2018 and from 1 January to date in 2019, in tabular form. [39067/19]

Joan Burton

Ceist:

63. Deputy Joan Burton asked the Minister for Finance the estimated number of correlative adjustments expected to be received in 2019 and 2020 in the work plans of the Revenue Commissioners. [39068/19]

Freagraí scríofa

Minister for Finance

I propose to take Questions Nos. 60 to 63, inclusive, together.

I am advised by Revenue that as at 30 June 2019, the latest date for which such data has been collated, approximately €191 million in tax is the subject of open correlative relief claims.

Table 1 includes the number of correlative relief claims made by companies for each of the years 2010 to 2019 (up to 30 June 2019), together with the number of claims where correlative relief was granted, and the tax value of relief granted.

Table 1

Year of claim	Number of claims received	Number of these claims where relief granted	Tax value of relief granted *
2010	16	15 (1 claim was withdrawn)	€89.7m
2011	8	5 (1 claim was withdrawn, 1 claim was not allowed, and 1 claim is still open)	€40.9m
2012	13	10 (1 claim was withdrawn, 2 claims were not allowed)	€79.4m
2013	10	5 (3 claims were withdrawn and 2 claims are still open)	€9.2m
2014	12	4 (2 claims were withdrawn, 1 claim was not allowed and 5 claims are still open)	€3.8m
2015	14	6 (2 claims were withdrawn, 1 claim was not allowed and 5 claims are still open)	€15.1m
2016	9	0 (1 claim was withdrawn, 1 claim was not allowed and 7 claims are still open)	-
2017	8	2 (6 claims are still open)	€15.0m
2018	11	0 (11 claims are still open)	€0.0m
2019	6	0 (6 claims are still open)	€0.0m

* Correlative relief may be granted over a number of years and may take the form of increasing losses to be carried forward as well as refunds and off-sets.

Table 2 includes details on the number of open correlative relief claims made by companies for each of the years 2010 to 2019 (up to 30 June 2019), including the quantum of adjustments claimed by these companies and the tax value of relief requested in each year.

Table 2

Year of Claim	Number of open claims	Total Adjustments Claimed	Tax Value of relief requested
2010	0	-	-
2011	1	€207m	€20m
2012	0	-	-
2013	2	€6.8m	€0.9m
2014	5	€425m	€51.2m
2015	5	€125.3m	€14.1m
2016	7	€273m	€30.8m
2017	6	€269.7	€33.7m
2018	11	€211.4	€25.6m
2019	6	€118.3m	€14.7m

Table 3 provides a further detailed breakdown of closed correlative relief cases in respect of claims received after 1 January 2014 which were either granted or withdrawn (full details of correlative relief claimed are not available for the years 2010 to 2013):

Table 3

Year of Claim	Total Number of closed claims	Tax Value of relief requested	Tax Value of relief granted*	Number of Claims where relief Granted in Full	Number of Claims where relief Partially Granted	Number of Claims Withdrawn/ Relief not granted in full.
2014	7	€39.7m	€3.8m	4	0	3
2015	9	€20.2m	€15.1m	5	1	3
2016	2	€9.4m	-	0	0	2
2017	2	€15m	€15m	2	0	0
2018	0	-	-	-	-	-
2019	0	-	-	-	-	-

* Correlative relief may be granted over a number of years and may take the form of increasing losses to be carried forward as well as refunds and off-sets.

Table 4 provides an analysis of the correlative relief claims received by country of adjustment since 1 January 2014 (full details of correlative relief claimed are not available for years 2010 to 2013

Table 4

Country of Adjustment	No of Correlative Relief Claims Received	Amount of tax relief requested
Austria	1	€1.6m
Belgium	2	€2.6m
Canada	2	€11.3m
Chile	1	€5.7m
Denmark	1	€0.1m
France	2	€1.7m
Germany	12	€29.9m
India	1	€0.7m
Italy	14	€112.5m
Netherlands	1	€0.2m
Poland	1	€1.3m
Spain	2	€10.1m
Switzerland	1	€1.7m
UK	6	€46.1m
US	9	€25.6m
Total	56	€251.2

A correlative relief claim can arise where an overseas tax authority imposes a transfer pricing adjustment on one party to an intercompany transaction and taxes profits that have already been taxed in Ireland. In order to avoid double taxation, the Irish party to the transaction may have the option to approach Revenue for a repayment of tax on a unilateral basis under the provisions of a double taxation treaty (that is, without involvement of the overseas tax authority). Given the nature of correlative relief claims, Revenue has advised that it is not possible to provide an estimate of claims which may arise in the future. Revenue will only consider the merits of a claim for correlative adjustment when all the necessary information and documentation required to be submitted with a request for a correlative adjustment is provided.

Finally, the Deputy should note that claim numbers and amount of tax relief granted as a result of corresponding adjustments agreed between Revenue and tax authorities of other countries under the Mutual Agreement Procedures (MAP) provided for in Double Tax Treaties are not included in the above figures.

Tax Data

Ceisteanna (64, 65, 66, 67)

Joan Burton

Ceist:

64. Deputy Joan Burton asked the Minister for Finance if an analysis will be provided of the known losses carried forward for corporation tax purposes at 31 December in each of the years 2015 to 2018, respectively, under each heading by general NACE classification (details supplied); and if he will make a statement on the matter. [39069/19]

Joan Burton

Ceist:

65. Deputy Joan Burton asked the Minister for Finance if an analysis will be provided of the known losses carried forward for income tax purposes at 31 December in each of the years 2015 to 2018, respectively, under headings by general NACE classification (details supplied); and if he will make a statement on the matter. [39070/19]

Joan Burton

Ceist:

66. Deputy Joan Burton asked the Minister for Finance if an analysis will be provided of known losses carried forward for corporation tax purposes at 31 December in each of the years 2015 to 2018 under headings by general NACE classification (details supplied); and if he will make a statement on the matter. [39071/19]

Joan Burton

Ceist:

67. Deputy Joan Burton asked the Minister for Finance his views on whether it is time to limit all losses forward for income and or corporation tax purposes; the estimated yield of such an action in a full year if a time to limit was set at five or ten years, respectively; and if he will make a statement on the matter. [39072/19]

Freagraí scríofa

Minister for Finance

I propose to take Questions Nos. 64 to 67, inclusive, together.

I am advised by Revenue that a sectoral breakdown of losses forward claimed on Corporation Tax returns and Income Tax returns is set out in the tables below for years 2015 to 2017 (inclusive). Information in respect of the 2018 tax year is not available, as the relevant tax returns are not yet filed. This information will be available in late 2020.

A breakdown of losses forward is not available by type of underlying loss or by age profile of the loss. However, Revenue’s report on Corporation Tax returns for 2017, at link https://www.revenue.ie/en/corporate/documents/research/ct-analysis-2019.pdf, (Sections 3.2 and 3.3) provides a detailed report of the available data in relation to losses forward and capital allowances by companies.

Trading Losses Forward Claimed by Companies (by Sector)

Sector	2015 €m	2016 €m	2017 €m
Financial & Insurance	124,175	112,796	106,949
Administrative & Support Service	37,966	39,619	45,464
Information & Communication	10,534	11,281	11,936
Construction	9,999	11,369	10,713
Manufacturing	8,305	8,857	8,449
Transportation & Storage	8,382	8,513	8,500
Wholesale & Retail Trade	7,628	7,991	8,832
All Other Sectors	11,347	14,158	12,105
Total	218,335	214,585	212,949

Trading Losses Forward Claimed by Self Assessed Taxpayers (by Sector)

Sector	2015 €m	2016 €m	2017 €m
Financial & Insurance	17	20	20
Administrative & Support Service	8	8	6
Information & Communication	2	2	8
Construction	589	627	695
Manufacturing	6	6	5
Transportation & Storage	13	20	7
Wholesale & Retail Trade	56	53	45
All Other Sectors	1,382	1,266	1,122
Total	2,074	2,001	1,908

In respect of question 39072/19, loss relief is generally provided in Part 12 of the Taxes Consolidation Act (TCA) 1997 for both income tax and corporation tax purposes. It allows losses incurred in the course of business or trade to be accounted for when calculating the same business’ tax liabilities. The purpose of this approach is to recognise that fluctuations in the business cycle may run over several years and that it would be unbalanced to tax profits earned in one year and not allow relief for losses incurred in another.

The treatment of losses in Ireland is a long standing feature of our tax system and is a standard feature of the tax systems in all OECD countries. There are therefore no plans to amend the current system, including to time limit the use of losses forward.

Deputies may be aware that my Department provided a technical note to the Committee on Finance, Public Expenditure and Reform, and Taoiseach in 2018 setting out many of the technical considerations relevant to corporation tax loss relief, and many of these considerations would apply also in respect of income tax loss relief. This paper is available online at: https://www.gov.ie/en/publication/436ff7-technical-note-on-the-potential-consequences-of-changes-to-the-treat/.