Written Answers Nos. 72-96
72. Deputy Jack Chambers asked the Taoiseach and Minister for Defence if documentation requested by a person (details supplied) as part of the person's residency application will be provided; and if he will make a statement on the matter. [42741/19]
Amharc ar fhreagraOfficials from my Department have been in contact with the Irish Naturalisation & Immigration Service to ascertain the nature and purpose of the information sought by them in this matter. In addition, this issue has been brought to the immediate attention of the appropriate Military Authorities to ensure that the required documentation is furnished to the individual concerned, in so far as this is possible.
73. Deputy Barry Cowen asked the Taoiseach and Minister for Defence the number of capital projects that cost €100 million or more in the past five years; the cost of outside consultants for each of the projects costing €100 million or more; and if he will make a statement on the matter. [42865/19]
Amharc ar fhreagraDefence capital funding is invested in equipment replacement and renewal and infrastructure development across the Army, Air Corps and Naval Service and ensures that the Defence Forces have the capabilities necessary to deliver on all their roles, assigned by Government.
In the past five years procurement of the new Off-Shore Patrol Vessels for the Naval Service was the only project costing in excess of €100 million, for Defence. The Naval Vessel replacement programme has seen the delivery of four new vessels, with the final vessel commissioned into service in April 2019. Investment in this programme amounted to €270 million, since 2010. Additionally consultancy costs of €85,603 associated with the planning stages of the project were incurred in 2008.
74. Deputy Barry Cowen asked the Taoiseach and Minister for Defence the number of capital projects anticipated to commence in the next five years that cost €100 million or more; the expected cost of external consultants for each project; and if he will make a statement on the matter. [42881/19]
Amharc ar fhreagraUnder the National Development Plan, as part of Project Ireland 2040, the Defence Vote was allocated €541 million in capital funding for the period 2018 to 2022. This level of capital funding allows the Defence Organisation to undertake a programme of sustained equipment replacement and infrastructure development across the Army, Air Corps and Naval Service and demonstrates the Government’s commitment to ensuring that the Defence Forces have the capabilities necessary to deliver on all their assigned roles, both at home and overseas.
Over the next five years the Defence Organisation will continue the programme of sustained equipment replacement and infrastructure development as set out and prioritised in the White Paper. Planning is ongoing for aircraft and naval vessel replacement projects which are likely to exceed €100 million but no finalised contracts are in place for these. Consequently overall project costs and any associated consultancy costs are not known at this stage.
75. Deputy Bernard J. Durkan asked the Taoiseach and Minister for Defence further to Parliamentary Question No. 47 of 19 September 2019, if discretion to reduce the pension of certain members of the Defence Forces rests finally with his Department or the Judiciary; and if he will make a statement on the matter. [42900/19]
Amharc ar fhreagraSection 13(2) of the 1923 Army Pensions Act (as amended) provides that in the case of a former member of the Permanent Defence Force, compensation received in respect of a disablement may be taken into consideration by the Minister for Defence in fixing the rate of disability pension or gratuity payable under the Army Pensions Acts for that disablement. It also provides that a disability pension already in payment may be reviewed in the light of compensation received and may be either terminated or reduced. The underlying rationale of section 13(2) is to prevent compensation "on the double".
The discretion to terminate or reduce a pension under Section 13(2) is a statutory power conferred on the Minister for Defence under the Act.
In exercising his statutory function, the Minister makes a bona fide individual decision on the merits of each case following consideration of the particular circumstances. In this regard, representations are invited from the individual regarding, in particular, the person's circumstances, details of the compensation actually received, and whether there are any special or extenuating circumstances involved. All representations received are considered by the Minister before a decision is made.
76. Deputy Niamh Smyth asked the Tánaiste and Minister for Foreign Affairs and Trade the number of first-time applicants from Great Britain and Northern Ireland who applied for an Irish passport from 2014 to date in 2019, in tabular form; and if he will make a statement on the matter. [42705/19]
Amharc ar fhreagraThe 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 following table.
|
Year |
First time applications from Great Britain |
First time applications from Northern Ireland |
|
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* |
40,960 |
57,572 |
* to 30 September 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.
77. Deputy Niamh Smyth asked the Tánaiste and Minister for Foreign Affairs and Trade the passport waiting times at present; the length of time online applications are taking to process; the length of time postal express applications are taking to complete; the number of applications the Passport Office has dealt with to date in 2019; if this number is up on 2018 for the same period; and if he will make a statement on the matter. [42706/19]
Amharc ar fhreagraThe Passport Service offers a range of convenient channels for the submission of passport applications by Irish citizens at home or abroad. These include an online passport renewal service, a postal application system, known as Passport Express, and a counter service for applicants who have immediate travel plans.
The online service brings significant benefits for citizens with over 30% of all online applications issuing in less than a week and all applications through the online channel having a turnaround time of less than 10 working days plus postage time. In addition, the cost of renewing a passport online is cheaper than alternative methods, with fees for all online applications being reduced by €5 across all application types.
The current processing times for postal applications submitted through Passport Express depend on the category of application. The turnaround time for renewal applications is currently 11 working days plus postage time, 4 days ahead of the target turnaround time of 15 working days. First time applications and applications from citizens who are applying to replace a lost, stolen or damaged passport are being processed in 15 working days plus postage time, 5 days ahead of the target turnaround time of 20 working days.
From January 2019 to 30 September 2019, the passport service received 742,715 passport applications. This compares to 680,768 passport applications received from January 2018 to 30 September 2018.
78. Deputy Michael McGrath asked the Tánaiste and Minister for Foreign Affairs and Trade if he will address a matter raised in correspondence relating to Bahrain (details supplied); and if he will make a statement on the matter. [42752/19]
Amharc ar fhreagraThe human rights situation in Bahrain remains a matter of concern. Although Bahrain has repeatedly stated its commitment to improving its human rights record and safeguarding human rights as enshrined in the Bahraini Constitution, there are ongoing instances of violations of fundamental freedoms there, including violations of freedom of opinion and expression, as well as the targeting of human rights defenders. Ireland attaches a high priority to safeguarding human rights defenders, and continually advocates for freedom for civil society actors to operate in a safe and enabling environment, without repression.
I was alarmed to learn of the executions of three people in July, including two human rights activists. A moratorium on the death penalty had been in place in Bahrain since 2010, and we saw the resumption of capital punishment in Bahrain in 2017 as a very negative development. Ireland condemns the use of the death penalty in all circumstances. Along with our EU partners, Ireland calls on Bahrain to again introduce a moratorium on executions, as a step towards the abolition of the death penalty.
I am also aware of reports of inhumane detention conditions as well as allegations that political prisoners in Bahrain have been tortured. I understand that a large number of prisoners held in Jau Prison in Bahrain went on hunger strike in response to these conditions. Ireland urges all States to safeguard the human rights of prisoners and detainees and is committed to the prevention and eradication of torture and other forms of cruel, inhuman or degrading treatment or punishment.
Respect for human rights is an integral part of Ireland’s foreign policy and we consistently seek to raise our concerns on human rights issues through the most appropriate and effective channels. Our active participation at the UN Human Rights Council is particularly important in that regard. Ireland regularly raises the case of human rights in Bahrain at that forum, in the form of national statements and its support to EU Statements. For example, in September 2018, Ireland expressed concerns about the ongoing restrictions on civil society space and the treatment of human rights defenders, and called on Bahrain to respect freedom of opinion and expression. In February 2019, Ireland reiterated concern at the ongoing detention of human rights defenders. In our Item 4 statement at the Human Rights Council in July 2019, Ireland called on Bahrain to ensure respect for freedom of opinion and expression, and the right to a fair trial. Ireland also took the opportunity at the most recent Council in September 2019 to reiterate its opposition to the use of the death penalty in all circumstances.
Since 2012, Ireland has signed five Human Rights Council joint statements on the human rights situation in Bahrain, which expressed concern on a number of fronts including the mistreatment of detainees, repression of demonstrations, and the arbitrary deprivation of nationality without due process. We shall consider carefully any opportunity to participate in a joint statement at a future Human Rights Council session, and I have asked my officials to keep the matter under review.
Our principled stance on human rights also feeds into our bilateral dialogue and we raise our human rights concerns directly with the Bahraini authorities at every opportunity. When I met the Bahraini Foreign Minister in New York last month I made a point of raising the human rights situation directly with him, expressing the hope that we can have an open and honest discussion on these issues. In addition, officials from my Department meet regularly with advocacy groups and Bahraini human rights defenders to discuss the situation in Bahrain.
Ireland will continue to monitor developments in Bahrain, and to call on the Bahraini Government to deliver on its stated commitment to make progress in relation to human rights. We shall do so both directly with Bahraini officials, as well as at EU and international level, including at the Human Rights Council, whenever opportunities arise.
79. Deputy Barry Cowen asked the Tánaiste and Minister for Foreign Affairs and Trade the number of capital projects that cost €100 million or more in the past five years; the cost of outside consultants for each of the projects costing €100 million or more; and if he will make a statement on the matter. [42869/19]
Amharc ar fhreagra80. Deputy Barry Cowen asked the Tánaiste and Minister for Foreign Affairs and Trade the number of capital projects anticipated to commence in the next five years that cost €100 million or more; the expected cost of external consultants for each project; and if he will make a statement on the matter. [42885/19]
Amharc ar fhreagraI propose to take Questions Nos. 79 and 80 together.
The Department of Foreign Affairs and Trade has a relatively small capital budget and has not had in the past five years, or does not expect to in the next five years, have any capital project costing €100 million or more.
81. Deputy Marc MacSharry asked the Minister for Finance the way in which the proposed new diesel rebate scheme for hauliers will operate, with reference to changes to the price floor, price ceiling and maximum rebate associated with this scheme. [42663/19]
Amharc ar fhreagraThe Diesel Rebate Scheme (DRS) was introduced in 2013 offering a partial refund to qualifying road operators on the excise paid on diesel when the retail price reaches €1.00 (Vat exclusive) or above. There is a maximum rebate of 7.5 cents per litre when the retail price is €1.25 (Vat exclusive) or above.
In recognition of the challenges facing the road haulage sector due to the uncertainty surrounding Brexit, I announced in my Budget 2020 speech that the DRS is being enhanced. The detail of this is set out in the Finance Bill which is being published today. In brief, the price floor of €1.00 (Vat exclusive) will remain the same; the marginal rebate rate will double at a price point of €1.07 or above; the maximum rebate amount will remain at 7.5 cents per litre; and the amended DRS will apply to fuel purchased by qualifying operators from 1st January 2020.
This represents a significant enhancement of the terms of the DRS. By way of example, the current average price of a litre of diesel is €1.093 (Vat exclusive), which if used as the average price under the current DRS would entitle qualifying operators to a rebate of 2.8c per litre. Under the enhanced DRS, qualifying operators would be entitled to a rebate of 4.4c if an average per litre price of €1.109 (Vat exclusive) were to be used as the basis for calculating the rebate. In other words, in the example outlined above, an additional 1.6c to the average price of a litre of diesel would be matched by the additional rebate amount. More generally, at a price point of €1.16 (Vat exclusive), the rebate amount under the enhanced DRS is 7.5c per litre which is 2.7c per litre more than the rebate amount that would be paid under the current DRS.
I appreciate that this scheme is a fossil fuel subsidy which the ESRI has found is directly increasing CO2 emissions. However, I consider, on balance, that the specific Brexit challenges faced by hauliers justifies this enhancement. This is intended as a temporary support measure, to be reviewed as part of the annual budgetary process.
82. Deputy Thomas P. Broughan asked the Minister for Finance the rationale for not first deploying resources from the rainy day fund to address additional no-deal Brexit expenditure rather than returning to borrowing for this purpose. [42683/19]
Amharc ar fhreagraThe Rainy Day Fund (RDF), which has the statutory title National Surplus (Exceptional Contingencies) Reserve Fund, is intended to act as a reserve which may be drawn upon under certain circumstances, outlined under section 9(2) of the Act, contingent on Government and Oireachtas approval. One criteria for drawdown is that it can be used to remedy or mitigate the existence of “exceptional circumstances” in the State. Under the Fiscal Responsibility Act 2012, such circumstances are defined as either a period of severe economic downturn or a period during which an unusual event outside the control of the State has a major impact on the financial position of the general government.
The RDF is intended, therefore, to be used as a defined-purpose instrument to address severe events, as opposed to the normal fluctuations within the economic cycle. This approach aligns it with the current EU fiscal rules framework, whereby there could be a drawdown from the RDF for an “unusual event” under the existing Stability and Growth Pact provisions. Withdrawals from the RDF will be transferred directly to the Exchequer so as to support shortfalls in revenue and voted expenditure to address the specific downturn. The RDF Act deliberately does not describe specific events, such as Brexit or others, so as to give flexibility to Governments to withdraw from the Fund for all severe downturns, many of which are not possible to specify in advance.
A drawdown from the RDF should not be the first action taken in the face of a no-deal Brexit, as the Government has already taken significant steps to prepare for Brexit and will continue to do so. These steps to prepare include dedicated measures, and economic and fiscal policies to get Ireland Brexit ready in Budgets since 2016.
I would, therefore, envisage that the occurrence of a Brexit with a significant fiscal impact and/or an economic downturn would justify draw down from the RDF. This is the sensible approach to using the Rainy Day Fund so as to ensure its funds are available and used to support measures that are timely, targeted and temporary, to assist in converting our economy and its businesses to a post-Brexit world. I would note that the Exchequer holds significant cash balances that are available for use immediately in responding to the fallout from all Brexit scenarios.
83. Deputy Thomas P. Broughan asked the Minister for Finance the steps he is taking to end the practices of dual pricing and personalised pricing by insurance companies in setting premium prices. [42687/19]
Amharc ar fhreagraAs the Deputy is aware dual pricing is the practice of quoting two different price points in different markets for the same product or service. The “different markets” could be differences between new and existing customers or between different channels for accessing the quoted price (for example, via telephone versus online). I understand that it is a common practice across markets, not just insurance, and that consumers are already familiar with such dual pricing between new and existing customers, for example, in respect of utilities, such as energy and telecommunications services.
The Deputy should note that I am responsible for the development of the legal framework governing financial regulation. Neither I, nor the Central Bank of Ireland, can interfere in the provision or pricing of insurance products, as these matters are of a commercial nature, and are determined by insurance companies based on an assessment of the risks they are willing to accept. That said, while the Consumer Protection Code 2012 does not explicitly reference dual pricing, the Central Bank has advised that the Code contains the general principle that regulated firms should act honestly, fairly and professionally in the best interests of their customers and the integrity of the market and make full disclosure of all relevant material information, including all charges, in a way that seeks to inform the customer. The Central Bank expects that companies’ pricing practices are compliant with these principles and requirements. The Central Bank also expects that Boards should be aware of and be comfortable with their firms’ price policies.
I also understand that this is an issue that is being reviewed in the UK by the Financial Conduct Authority (FCA) following complaints by the UK National Association of Citizens Advice Bureaux, Citizens Advice. The FCA released an interim report on 4 October and it found that the home and motor insurance markets were not working well for all consumers in the UK. It also found that while a large number of people shop around, many loyal customers are not getting a good deal. The other key findings of the report noted that insurers often sell policies at a discount to new customers and increase premiums when customers renew, targeting increases at those less likely to switch; and that this appeared to impact consumers that showed at least one characteristic of vulnerability, such as having lower financial capability. While this is an interim report and it does not recommend any remedies at this stage, the FCA is due to publish its final report with possible remedies in Q1 2020.
Both Minister of State D’Arcy and I have concerns about the potential impact that dual pricing practices could have on certain vulnerable customers if they are being employed in Ireland, particularly in light of the interim findings in the UK on the matter. Prior to making any conclusions on this however, we need more detailed information about the extent and scale of the practice and what can be done to address it. Accordingly, I have asked the Central Bank for their views on this matter as a first step.
84. Deputy Michael McGrath asked the Minister for Finance the special arrangements that apply to agricultural contractors in respect of changes made to carbon tax and diesel rebate as part of budget 2020; and if he will make a statement on the matter. [42698/19]
Amharc ar fhreagraIn my Budget 2020 speech, I announced an increase from €20 to €26 in the carbon tax. Following the approval of the Dáil, this increase has been applied to Mineral Oil Tax (MOT) rates for mineral oils used as auto-fuels (for cars and trucks) from midnight on 9 October 2019. All other MOT rates remain at their current levels until 1 May 2020 when new rates will take effect subject to the enactment of the Finance Bill 2019.
The current rate of MOT for marked gas oil (MGO), also referred to as “green agricultural diesel”, is €102.28 per 1,000 litres, comprised of a carbon charge component of €54.92 and a non-carbon charge component of €47.36 per 1,000 litres. These rates did not increase from Budget night. From 1 May 2020 the MOT rate for MGO will be €117.78 per 1,000 litres, arising from the increase of the carbon component from €54.92 to €70.42; the non-carbon component will not change from its current level of €47.36 per 1,000 litres.
I am advised by Revenue that agricultural contractors who incur expenses in relation to farm diesel in the course of their trade of agricultural contracting may claim an income tax or corporation tax deduction for those expenses, including any carbon tax charged in respect of the diesel.
When carbon tax was increased in Budget 2012, provision was made for a separate and additional tax measure for farmers to compensate them for the increase. The statutory basis for this tax relief is section 664A of the Taxes Consolidation Act 1997. It is available to individuals and companies that carry on a trade of farming and are entitled to claim an income tax or corporation tax deduction in respect of farm diesel. However, it should be noted that agricultural contractors are not entitled to this relief as they are not carrying on a trade of farming. This is because farming, which is defined in section 654 of the Taxes Consolidation Act 1997, requires the occupation of farm land and agricultural contracting does not involve the occupation of farm land.
The Diesel Rebate Scheme (DRS) was introduced in 2013 and offers a partial refund to qualifying road operators on the excise paid on diesel when the retail price is €1.00 (Vat exclusive) or above. The maximum rebate is 7.5 cents per litre when the retail price is €1.25 (Vat exclusive) or above.
Certain qualifying criteria apply, for example, auto diesel must be purchased in the State, either in bulk (over 2,000 litres) or via a Revenue approved Fuel Card, and used in a qualifying vehicle for the purpose of business transport activities. Operators with a licence issued in other EU Member States are also eligible to claim on diesel purchased in the State subject to meeting all the other scheme criteria.
In recognition of the challenges facing the road haulage sector due to the uncertainty surrounding Brexit, I announced in my budget speech that the Diesel Rebate Scheme is being enhanced. The publication of the Finance Bill today will set out the details of the enhancements to the Scheme. This is intended as a temporary support measure, to be reviewed as part of the annual budgetary process.
Full details regarding the Diesel Rebate Scheme and qualification criteria are available on the website of the Office of the Revenue Commissioners:
https://www.revenue.ie/en/companies-and-charities/excise-and-licences/mineral-oil-tax/diesel-rebate-scheme/index.aspx.
85. Deputy Brendan Griffin asked the Minister for Finance his views on a matter (details supplied); and if he will make a statement on the matter. [42756/19]
Amharc ar fhreagraFinance Bill 2019, published today, provides for the application of the 13.5% rate of VAT on food supplements.
The Deputy will be aware that shortly after the introduction of VAT, Revenue applied a concessionary zero rating to certain vitamin, mineral and fish oil products. As the market developed over the years this treatment resulted in the zero rating by Revenue of further similar products, including products other than vitamins, minerals and fish oils. The scope of the relatively narrow original zero rating of food supplement products permitted by Revenue broadened progressively over time to the point that it had become increasingly difficult to maintain an effective distinction between food supplements that could benefit from the zero rate and those that were standard rated. This caused difficulties for both Revenue and industry.
Following a comprehensive review of the VAT treatment of food supplements, Revenue concluded that the status quo was no longer sustainable. Following this review, Revenue engaged with the Department of Finance concerning policy options that might be considered in the context of Finance Bill 2018. The relevant legislation was not changed in Finance Bill 2018 and therefore Revenue issued new guidance in December 2018 which removed the concessionary zero rating of various food supplement products with effect from 1 March 2019.
Following representation from Deputies and from the industry, Revenue delayed the withdrawal of its concessionary zero rating of the food supplement products concerned until 1 November 2019. This allowed time for my Department to carry out a public consultation on the taxation of food supplement products. The public consultation sought input from a wide range of interested parties, including from health and nutrition experts and the Minister for Health to ensure that any legislative changes brought forward was evidence based. The results of the consultation were included in the 2019 VAT Tax Strategy Group paper as part of the Budget 2020 process.
The implementation of a 13.5% rate will provide certainty to industry in respect of food supplement products and will apply prospectively. It is important to clarify that certain products will not be impacted by the change introduced in this Finance Bill (e.g. foods for specific groups, vitamins and minerals such as folic acid licensed as medicines by the HPRA, and fortified foods). These products will continue to benefit from the zero rating for VAT purposes.
86. Deputy Alan Kelly asked the Minister for Finance if he will provide all correspondence between him and-or his office and-or his advisers and-or the Secretary General and-or the office of the Secretary General and the Department of Health from September 2019 to 10 October 2019. [42780/19]
Amharc ar fhreagraI wish to advise the Deputy that a deferred reply will be issued to him in respect of this Parliamentary Question, in line with Standing Order 42A.
87. Deputy Jackie Cahill asked the Minister for Finance the tax allowances available for carers who do not qualify for a carer's allowance; and if he will make a statement on the matter. [42825/19]
Amharc ar fhreagraThere are a number of tax reliefs available to individuals who are carers.
The Home Carer Tax Credit is available to married couples or civil partners that are jointly assessed, where one spouse or civil partner stays at home to take care of a dependent person. Its current value is €1,500. The carer spouse or civil partner may earn up to €7,200 per year without affecting the amount of the credit awarded. Where this income exceeds €7,200, the amount of credit available is reduced by one half of the excess over €7,200, subject to a maximum income limit in 2019 of €10,200. Further details on this credit can be found at the link: https://www.revenue.ie/en/tax-professionals/tdm/income-tax-capital-gains-tax-corporation-tax/part-15/15-01-29.pdf In Budget 2020, I announced that the Home Carer Tax Credit will be increased from €1,500 to €1,600.
The Incapacitated Child Tax Credit is a tax credit of €3,300, which can be claimed by a person in respect of a child who is permanently incapacitated either physically or mentally from maintaining himself or herself and had become so before reaching 21 years of age or finishing full-time education. More information about this credit is available at the link: https://www.revenue.ie/en/tax-professionals/tdm/income-tax-capital-gains-tax-corporation-tax/part-15/15-01-05.pdf
The Dependent Relative Tax Credit is a tax credit of €70, which can be claimed by an individual who maintains, at his or her own expense, a relative, or a child, who is unable to maintain himself or herself. This credit cannot be claimed in conjunction with the Incapacitated Child Tax Credit and is subject to a cap on the income of the dependent relative. Further information on this credit can be found at the link: https://www.revenue.ie/en/tax-professionals/tdm/income-tax-capital-gains-tax-corporation-tax/part-15/15-01-27.pdf
The Single Person Child Carer Tax Credit is a tax credit of €1,650, which is available to a single parent (whether widowed, separated, deserted or a single parent) with a dependent child who is under 18 or, if over 18, is an incapacitated child who satisfies the Incapacitated Child Tax Credit criteria. Detailed guidance on this credit is available at the link: https://www.revenue.ie/en/tax-professionals/tdm/income-tax-capital-gains-tax-corporation-tax/part-15/15-01-41.pdf
In addition, income tax relief is available for certain health expenses, including visits to the doctor, medicines, nursing care in the patient’s home (in certain circumstances), nursing home fees, expenditure in respect of children with life threatening illnesses, kidney patients’ expenses, mileage for individuals who need to travel for treatment and certain medical appliances. More information on tax relief for health expenses is available at the link: https://www.revenue.ie/en/tax-professionals/tdm/income-tax-capital-gains-tax-corporation-tax/part-15/15-01-12.pdf
And finally an exemption from income tax applies in respect of the Carer’s Support Grant and the Domiciliary Care Allowance, which are payments made by the Department of Employment Affairs and Social Protection. The question of a person’s entitlement to these payments and to the Carer’s Allowance is a matter for the Department of Employment Affairs and Social Protection.
88. Deputy Michael McGrath asked the Minister for Finance the rationale behind the budgeted yield of €80 million from the changing of the dividend withholding tax rate of 25% if the tax can be deducted from an income taxpayer's income tax liability; the amount of the €80 million anticipated to come from dividends paid to Irish tax residents; and if he will make a statement on the matter. [42851/19]
Amharc ar fhreagraIrish resident companies are obliged to apply Dividend Withholding Tax (DWT) on dividend payments and other distributions made to Irish taxpayers. Dividends are treated as income and are ultimately liable to income tax at the individual’s marginal rate which is the highest rate of income tax to which they are liable. Universal Social Charge (USC) is also chargeable on the payments and in certain instances PRSI.
As I announced in my Budget 2020 speech, Revenue has identified a potential gap between the DWT remitted by companies and the income tax and USC ultimately payable by Irish taxpayers.
The rate of DWT that is currently applied is the standard 20% rate of income tax, but most individuals are also subject to the USC (0.5%, 2%, 4.5% and 8% rates). When DWT was first introduced in 1999 and standard rated, there was no USC and the WHT rate has never been updated to take account of the USC. As a result, the current 20% DWT rate does not cover the income taxes that are ultimately be due on a self-assessment basis so, while DWT has been applied to a dividend payment, a further amount of tax may be due.
To address this gap, I announced changes to the DWT regime. Firstly, an increase in the rate of DWT from 20% to 25% from 1 January 2020. Secondly, from 1 January 2021, Revenue will introduce a modernised DWT regime that will utilise real-time data, which will allow a personalised rate of DWT to be applied to each individual taxpayer based on their marginal rate.
The revised 25% rate is considered a reasonable combination of the 20% rate of income tax and the most common rate of USC which is the 4.5% that applies to income between €19,874 and €70,044. In addition, it is likely that many of the taxpayers in question are also subject to the higher 40% rate of income tax.
The €80 million budgeted yield from the increase in the DWT rate from 20% to 25% is estimated based on prudent assumptions from payments in 2018 and to date in 2019. The yield is expected to arise on payments from Irish resident companies to Irish resident individuals in 2020 through reducing the potential gap described above between DWT withheld and the final tax payable by individuals.
From 2021 onwards, the modernized DWT regime arising out of the newly modernized PAYE system will eliminate this gap by ensuring all individual taxpayers pay the right tax at the right time. It is important to note there is no proposed change to due dates for companies to return DWT as part of the modernised regime.
89. Deputy Michael McGrath asked the Minister for Finance the list of flat rate expense allowances; the available allowance for each flat rate expense; the purpose of each allowance; the profession it is linked to; if the allowance is based on legislation; if his intention is to remove all allowances that are not based in legislation; the expected yield from such a change; if that yield was incorporated into budget figures for revenue raising measures; when he expects the changes to be introduced; his plans to amend legislation in order that some of the allowances are permitted; and if he will make a statement on the matter. [42852/19]
Amharc ar fhreagraThe flat rate expense (FRE) system is an administrative practice operated by Revenue, where both specific commonality of expenditure exists across an employment category and the statutory requirement for the tax deduction as set out in section 114 Taxes Consolidation Act (TCA) 1997 is satisfied.
The purpose of the FRE regime is to ease the administrative burden on Revenue and on employees in certain sectors by facilitating the automatic granting of a fixed tax allowance to cover allowable employment-related expenses, without the need for annual claims by every employee concerned.
The FRE regime developed incrementally over the last 40 to 50 years, and currently incorporates some 53 employment categories covering broadly 134 individual FRE allowances, relating to a wide range of employments and professions. The full list, detailing each of the available FRE allowances for 2019, is published on the Revenue website: https://www.revenue.ie/en/personal-tax-credits-reliefs-and-exemptions/documents/flat-rate-expenses.pdf
I am aware that over the past 18 months, Revenue has been conducting a comprehensive review of the FRE regime. Revenue has advised me that the purpose of the FRE review, which involved engagement with relevant representative bodies, is to ensure that the expenses granted to each employment category remain justified and appropriate to modern day employments and work practices. Each category of FRE allowance is being examined separately in the light of the legislative requirements. I understand that the review may result in increases and decreases in several FRE categories, the withdrawal of the right to avail of the FRE allowance in certain categories and the introduction of new categories where appropriate. Revenue have advised that a flat rate expense allowance can only be retained to the extent that there is a legislative basis to support the right to tax deductibility in respect of the expense.
Revenue has advised me that its FRE review is nearing conclusion, with an implementation date of 1 January 2020 for all changes to the FRE regime to make sure that employees in any one sector are not impacted on earlier than employees of another sector. Revenue will be publishing a comprehensive list of all FRE allowances for 2020 in advance of the implementation date.
I am also advised by Revenue that it is not possible to accurately quantify the anticipated increase in tax revenue arising out of any abolition or reduction of FRE allowances, as the cost of such allowances vary depending on the particular circumstances of the individual recipients, for example, the extent of their income subject to tax and whether income is subject to tax at the standard or marginal rate. Moreover, a breakdown of the cost and numbers by reference to each employment category in which the FRE regime currently operates is not readily available. Prior to 2018, Revenue’s systems were not designed to identify FREs as a separate item from expenses generally. However, the current (2018) Income Tax Form 11 and Form 12 tax returns now have specific questions on FREs, which will allow Revenue to segregate FREs from expenses claimed generally. However, final figures for 2018 are not expected to be available until mid-2020 to allow for processing of the data from income tax returns and cross referencing across Revenue operational systems. No account was taken of potential yield from changes to the FRE regime from 2020 when formulating revenue raising measures for Budget 2020.
As the Deputy will be aware, the administration of the tax code is exclusively a matter for Revenue who are independent in the performance of their functions. Any changes in practice to the flat rate expenses regime are therefore a matter for Revenue, but I understand that any withdrawal of the practice can only take place if Revenue are satisfied that there is no longer a legally valid basis to give the concession, after engagement with the relevant representative body acting on behalf of the various categories of workers.
There has been no change to the general rule set out in legislation which says that all employees are entitled to claim a tax deduction under section 114 of the TCA 1997 in respect of an expense incurred wholly, exclusively and necessarily in the performance of the duties of their employment, to the extent which the expenses are not reimbursed by the employer. Any changes to the general rule in section 114 TCA could lead to a considerable erosion of the income tax base, with potentially significant additional costs to the Exchequer, and are therefore not being considered at this time.
However, it is important to be clear that Revenue’s operation of the regime does not preclude any employee from making an individual claim for a tax allowance in respect of employment-related expenses, where those expenses meet the statutory requirement for such an allowance. Therefore, while certain employees may no longer claim a deduction on a universal “flat rate” basis, they may still be able to still claim a deduction on a specific “vouched basis”.
At the same time, I expect that Revenue will implement the outcome of their review in their customary proportionate and fair manner fully cognisant of the impact on the individuals concerned, as they have done before on many occasions.
90. Deputy Michael McGrath asked the Minister for Finance the number of cases over the past five years in which the Revenue Commissioners have settled a tax liability for less than the value of the tax liability; the difference in each year between the final settlements made and tax liabilities in those settlements; the reason for settling for less than the tax liability; and if he will make a statement on the matter. [42853/19]
Amharc ar fhreagraI am advised by Revenue that it does not accept amounts in settlement that are less than the actual amounts due. However, certain circumstances can arise where a taxpayer does not have the financial capacity to pay the additional liability identified during a compliance intervention and can claim inability to pay.
Any inability to pay claim must be supported with clear evidence of the taxpayer’s financial situation and Revenue always reserves the right to subsequently reverse an agreed ‘claim’ if the person’s situation unexpectedly improves. The following table sets out the amounts (tax, interest and penalties) that were accepted as ‘Inability to Pay’ by Revenue over the past five years.
|
Year |
Number of Inability to Pay Cases |
Inability to Pay Amounts |
|
2014 |
172 |
€22.9 m |
|
2015 |
186 |
€21.3 m |
|
2016 |
148 |
€19.6 m |
|
2017 |
125 |
€13.8 m |
|
2018 |
130 |
€24.8 m |
Where an inability to pay claim is not accepted, Revenue pursues collection with the taxpayer for the full amount (tax, interest and penalties) due. Where the taxpayer does not pay the liability, either as a single payment or on a phased basis, Revenue uses its debt collection/enforcement options, including Sheriff, Court Judgments and Attachment Orders to secure payment.
In the most egregious cases, Revenue will apply to the Courts to commence insolvency proceedings including Liquidation (corporate entities) and Bankruptcy (individuals). Once a taxpayer is adjudicated insolvent, Revenue is legally obliged to accept a reduced amount, having regard to its preferential creditor status.
As the Deputy is aware, the Comptroller and Auditor General (C&AG) included a review of ‘tax compliance interventions’ (Chapter 17) in the 2018 Report of the Accounts of the Public Services.
91. Deputy Barry Cowen asked the Minister for Finance the number of capital projects that cost €100 million or more in the past five years; the cost of outside consultants for each of the projects costing €100 million or more; and if he will make a statement on the matter. [42868/19]
Amharc ar fhreagra92. Deputy Barry Cowen asked the Minister for Finance the number of capital projects anticipated to commence in the next five years that cost €100 million or more; the expected cost of external consultants for each project; and if he will make a statement on the matter. [42884/19]
Amharc ar fhreagraI propose to take Questions Nos. 91 and 92 together.
I can confirm that my Department has had no capital projects in the past five years (including the cost of external consultants) in excess of €100 million and nor does it anticipate any to commence in the next five years.
93. Deputy Seán Haughey asked the Minister for Public Expenditure and Reform his plans for a building (details supplied); the use being made of same; the way in which it is being protected; and if he will make a statement on the matter. [42712/19]
Amharc ar fhreagraThe Commissioners of Public Works (CPW) manage the Debtors' Prison which is a protected structure that was built circa 1794. The property is a free- standing U-shaped three storey over basement building that, while externally sound and waterproof, is internally in very poor condition with only basic services.
A number of organisations have expressed an interest in acquiring the property under licence/lease for use as artist studios, employment support services, advocacy services, etc. From time to time, the building is licensed for use as a film set.
The OPW has met with Dublin City Council in relation to its future use. However, the extent of fire safety and refurbishment works needed to meet with current regulations is significant. Therefore, the OPW continues to engage with DCC to consider the most appropriate use for this historic property.
In relation to protecting the property, regular maintenance is undertaken by the OPW to protect the fabric of the building. Security services are engaged to protect against intrusion and vandalism.
94. Deputy Jan O'Sullivan asked the Minister for Public Expenditure and Reform if budget 2020 was poverty proofed; and if he will make a statement on the matter. [42732/19]
Amharc ar fhreagraSignificant progress has been made in recent years in reducing the prevalence of poverty in our country. CSO data shows that the proportion of those living in consistent poverty dropped from 9.0% in 2013 to 6.7% in 2017. CSO data on poverty is available at this link: https://www.cso.ie/en/releasesandpublications/ep/p-silc/surveyonincomeandlivingconditionssilc2017/povertyanddeprivation/#d.en.181339
For most people, employment is the primary path out of poverty and we have created thousands of new jobs, with a record 2.3 million people now at work in our economy. Our income tax system is considered progressive by international standards; our tax revenue funds a wide range of services, with an emphasis on providing support to the groups in our society who need it the most.
Budget 2020 was framed in unique circumstances. What might be seen as normal Budgetary elements such as modest income tax reductions and across-the-board welfare rate increases did not feature. What did feature, however, were sizeable targeted expenditure increases in a number of sectors. These will have a positive impact on society to be factored into a balanced assessment of the Budget, rather than focusing solely on the fact that income tax and welfare payments remain largely unchanged.
Employment Affairs and Social Protection
A carefully targeted social welfare package, benefiting the vulnerable elderly, families and carers was introduced in Budget 2020. The Living Alone Allowance, which is targeted at the most vulnerable pensioners, was raised by €5 per week; the Fuel Allowance was also increased, so that the increase for those in the lowest income deciles who receive it will more than cover the cost of the new carbon tax. There were further increases for qualified child dependants in all weekly payments. There was an increase in the earnings disregard for those in receipt of the One Parent Family Payment, and an increase of €10 in Working Family Payment thresholds for recipients with up to three children. In addition there was an increase in the hours that carers can work or study outside the home. Finally, I announced payment of a 100% Christmas Bonus in 2019.
Distributional Impacts
The Department of Finance prepared an analysis on the distributional impacts of the direct tax, indirect tax and welfare measures contained in Budget 2020 using the SWITCH micro-simulation model. This analysis found on average the first three deciles gained from the tax and welfare measures and the rest of the deciles were left broadly unchanged. Gains were largest for the first decile, followed by the second and third which indicates that the tax and welfare measures in Budget 2020 were broadly progressive. The SWITCH analysis cannot take into account other expenditure measures such as increased expenditure in health or education.
Annex B of the Tax Policy Changes document published by the Department of Finance on Budget day also sets out a distributional analysis of Budget 2020 Measures on a variety of household family types across a range of income levels. The document is available at this link: http://budget.gov.ie/Budgets/2020/Documents/Budget/Budget%202020%20Tax%20Policy%20Changes.pdf
Expenditure
As set out in Expenditure Report 2020, the focus of the core element of Budget 2020 is on providing for sustainable increases in public expenditure. This is in recognition of the key role of public services and infrastructure in supporting our citizens and promoting the resilience of our economy, particularly in light of the increasing risks in the global economic environment. Particular focus was placed on maintaining and improving supports for children and families, as well as for elderly people.
In order to protect the most vulnerable in society, Budget 2020 provides an allocation of over €21 billion for the Department of Employment Affairs and Social Protection. The significant provision of supports provided through the Social Protection system represents an important strand of the Government’s commitment to tackling poverty and social inequality in Ireland.
Gross current expenditure for the Department of Children and Youth Affairs will see an increase of over 6% in 2020, rising to almost €1.6 billion. As well as increased funding for Early Years Care and Education, central to this allocation is funding for the continued roll-out of the National Childcare Scheme.
€17.4 billion in current expenditure will be allocated to the Health sector in 2020, a year on year increase of over 6%. This investment reflects the Government’s commitment to create a more responsive, integrated and people-centred Health system. New measures such as a reduction of prescription charges for over 70’s, the expansion of free GP care to all children under 8 and free dental care for children under 6 will all contribute to improving access to health and social services across the country.
The Housing programme in the Department of Housing, Planning and Local Government will see an increase of 11% compared with 2019, bringing the total allocation to almost €2.6 billion (including current and capital expenditure). This allocation will support the Social Housing needs of over 27,500 households in 2020. This includes the delivery of 11,167 new social homes through build, acquisition and leasing programmes as well as supporting 16,350 new households under the HAP and RAS schemes.
Further details of these measures and all Budget 2020 allocations can be found in Expenditure Report 2020, which can be found on budget.gov.ie.
Carbon Tax
Budget 2020 included an increase in carbon tax of €6 per tonne, which is expected to raise €90 million in 2020. The funding raised is to be directed to support increases to existing climate related schemes or new schemes that would not have been provided in the absence of this increase. Government has been clear that the importance of clear action in this regard must be balanced with measures to promote equity during the transition. The revenue raised in 2020 will support:
- €34 million in funding to protect the vulnerable through an increase in the fuel allowance and energy efficiency upgrades;
- €31 million for schemes to ensure a just transition to a low carbon economy, including measures with a particular focus on the midlands;
- €25 million for programmes that can help all citizens to reduce their carbon footprint.
These measures are set out in more detail in the paper published alongside the Budget on 8 October, ‘The Carbon Tax Increase – What it Will be Spent On’. This paper can be found on the Budget website:
http://www.budget.gov.ie/Budgets/2020/Documents/Budget/The%20Carbon%20Tax%20Increase_What%20it%20will%20be%20spent%20on.pdf
Equality Budgeting
An Equality Budgeting pilot was adopted for the 2018 budgetary cycle, built on the existing performance budgeting framework. Equality Budgeting aims to provide greater information on the likely impacts of proposed and ongoing budgetary measures, which, in turn, enhances the potential to better facilitate the integration of equality concerns into the budgetary process, avoid unintended adverse outcomes and enhance the Government’s decision making framework. It involves Departments setting concrete measurable targets for equality objectives in the Revised Estimates Volume and reporting on progress in the Public Service Performance Report. For the pilot exercise, a number of diverse policy areas were selected with associated objectives and indicators. The learnings from the pilot were used to inform the expansion of the equality budgeting initiative to further develop the gender budgeting elements, and to broaden its scope to other dimensions of equality including poverty, socioeconomic inequality and disability. An Equality Budgeting Expert Advisory Group has also been established. This group is comprised of a broad range of relevant stakeholders and policy experts to provide advice on the most effective way to advance Equality Budgeting policy and progress the initiative.
Future direction will now be assisted by the recent publication of the OECD Scan of Equality Budgeting in Ireland which sets out a path forward with a number of recommendations for consideration. This work was commissioned by both the Department of Public Expenditure & Reform and the Department of Justice & Equality. The scan recommendations are aligned with international experiences of best practice in this field. Implementation of the Report’s recommendations will be carried forward in close consultation with the Equality Budgeting Expert Advisory Group. The OECD report can be found at http://oe.cd/equality-budgeting-ireland.
Social Impact Assessment
The Social Impact Assessment (SIA) series of papers aims to provide an evidence based methodology to examine the impact of public expenditure on households. This framework is designed to examine the demographic profile of public service users, and how they are impacted by budgetary policy decisions. This approach complements the budgetary impact assessments carried out using the SWITCH (Simulating Welfare and Income Tax Changes) model by the Department of Finance and the Department of Employment Affairs and Social Protection, and externally by the Economic and Social Research Institute (ESRI). SIA papers published with Budget 2020 focused on topics such as the Domiciliary Care Allowance and Public Service Obligation (PSO) funding for Public Transport. More information about the SIA series is available at https://www.gov.ie/en/policy-information/615fe5-social-impact-assessment-framework/.
National Childcare Scheme
The importance and value of quality early years care and education is well-documented. The international evidence shows a wide range of benefits for children, families and society at large. High quality services provide long-lasting cognitive, social and emotional benefits for children, supporting children to enjoy their childhood and realise the full potential of their future. However, affordability and accessibility of quality childcare is a major concern for many parents and can act as a barrier to employment which, in turn, increases the risk of poverty. The National Childcare Scheme (NCS) aims to improve children's outcomes, support lifelong learning, make work pay, reduce child poverty and tangibly reduce the cost of quality childcare for thousands of families across Ireland.
A Focused Policy Assessment (FPA) on the NCS published by DCYA in October 2018 presented the impacts as:
- Increased labour force participation amongst parents with children ages 0-15 (incl. female participation)
- Higher quality childcare provision than currently available
- Positive outcomes for children
- Reduced poverty among families with children.
Taken as a whole, therefore, there is a wealth of information published in the context of Budget 2020 which provides important insights into the wide range of targeted benefits and public service improvements that have been delivered, and to their impact on citizens' lives and wellbeing.
95. Deputy Jackie Cahill asked the Minister for Public Expenditure and Reform the status of contracts for food concessions in hospitals, universities and all other State-run institutions which are held by UK owned companies in a no-deal Brexit situation and a deal Brexit situation, respectively; and if he will make a statement on the matter. [42757/19]
Amharc ar fhreagraPublic Procurement is governed by EU legislation and National rules and guidelines. The aim of these rules is to promote an open, competitive and non-discriminatory public procurement regime which delivers best value for money. In this regard, it is important to point out that the rules underpinning procurement have not changed due to Brexit, as the procurement Directives already provide for a range of options for trading with third countries.
The Office of Government Procurement (OGP) has responsibility for developing and setting out the overarching policy framework for public procurement in Ireland. In this context, the OGP published an Information Note on Brexit and Public Procurement in 2017, which has been updated to take account of developments in the interim in December 2018 and June with the most resent iteration being published last week.
The Information Note sets out the potential risks faced by public bodies that would include disruption to supply, increases in costs, extra administrative burdens, and changes in the regulatory environment. In addition, to identifying risk, the Information Note emphasises the importance of managing any potential risks to supply and the need to put in place the necessary detailed contingency plans. Such contingencies could include, but are not limited to, buying in bulk and holding stock, and sourcing substitutions and alternative suppliers.
Whilst the OGP establishes certain aggregated arrangements on behalf of public bodies, the bulk of public procurement remains outside centralised structures. Therefore, it is the responsibility of each public body to ensure the continued delivery of public services as they are best placed to assess and develop contingency planning in relation to their own contracts, including the specific risks associated with Brexit.
The OGP has written to all Government Departments advising them to identify and manage any potential risks and to put in place the necessary detailed contingency plans.
96. Deputy Alan Kelly asked the Minister for Public Expenditure and Reform if he will provide all correspondence between him and-or his office and-or his advisers and-or the Secretary General and-or the office of the Secretary General and the Department of Health in September 2019 to 10 October 2019. [42781/19]
Amharc ar fhreagraI wish to advise the Deputy that a deferred reply will be issued to him in respect of this Parliamentary Question, in line with Standing Order 42A.
