Written Answers Nos. 201-220
201. Deputy Bernard J. Durkan asked the Tánaiste and Minister for Enterprise, Trade and Employment the extent to which he and his Department continue to reach the necessary targets in job creation to ensure full employment and economic progress in the future; and if he will make a statement on the matter. [25622/22]
Amharc ar fhreagraThe Economic Recovery Plan (ERP) published in June 2021 sets out the Government’s medium-term economic plan to rebuild Ireland’s economy. As well as committing to a package of supports and investments to assist enterprise recovery, the Plan outlines a medium-term policy framework to rebuild sustainable enterprises, encourage job creation and sustainable and balanced post pandemic growth.
Employment levels have recovered strongly as public health restrictions have been unwound. The employment rate for those aged 15-64 has rebounded from the pandemic to 73.0% in Q4 2021 compared to 67.0% in Q4 2020 and has exceeded the employment rate of 70.1% in Q4 2019. Similarly, the unemployment rate fell over the course of 2021 as the economy recovered. It is now approaching the pre-pandemic rate of 4.5% as the recovery continues.
Projects funded under the National Recovery and Resilience Plan (NRRP) are integrated into the Economic Recovery Plan, and reinforce the Government’s approach, which is focused on supporting recovery and job creation, advancing the green transition, and accelerating and expanding digital reforms and transformation.
The latest iteration of the national employment strategy – Pathways to Work 2021-2025 – will help unemployed people get back into employment through intense activation, upskilling and reskilling opportunities, and engaging with employers. It will have an overall target of over 100,000 additional caseloads per year, by expanding the caseload capacity of the Public Employment Service, reducing the risk of labour market scarring and long-term unemployment. There will be a particular focus on youth unemployment and working intensively with young people at greater risk of long-term unemployment, in recognition of the disproportionate effect of the pandemic on young people.
In addition to the work already underway, the Government is looking to prepare for the economy of the future. On 1 March 2022, Government agreed to the development of a White Paper on Enterprise Policy in 2022, led by my Department. The White Paper will set out set out an ambitious medium- to long-term direction for enterprise policy in response to challenges, opportunities and new drivers of growth catalysed by the Covid-19 pandemic, new economic and geopolitical realities, and an increased urgency to accelerate the decarbonisation of industry.
In so doing, the White Paper will articulate what needs to be done differently to realise this vision and to set out clearly the risks to be faced and the policy choices and trade-offs that will arise in order to maintain high-quality jobs, to protect the elements which make Ireland’s economy globally attractive for investment and to ensure a competitive Irish economy into the future.
202. Deputy Bernard J. Durkan asked the Tánaiste and Minister for Enterprise, Trade and Employment the extent to which the level of support for small and medium-sized enterprises continues; and if he will make a statement on the matter. [25623/22]
Amharc ar fhreagraMy Department, through our enterprise agencies, provides our small and medium-sized enterprises (SMEs) with a comprehensive suite of direct financial and soft supports.
The Local Enterprise Offices (LEOs) can offer direct grant aid to microenterprises (10 employees or fewer) in the manufacturing and internationally traded services sectors which, over time, have the potential to develop into strong export entities.
The LEOs also provide a wide range of high-quality business and management development programmes that are tailored to meet specific business requirements, and aim to provide entrepreneurs with the knowledge and skills to make their businesses a success.
In March 2021, the Local Enterprise Office launched the Green for Micro programme. This support is open to all micro enterprises with fewer than ten employees, and offers free advice and technical support on resource efficiency, how to better understand their carbon footprint and how to implement an environmental management system to reduce costs and lower greenhouse gas emissions.
The Local Enterprise Offices are also preparing to roll out a new digital scheme which will help businesses to prepare and implement a plan for the adoption of digital tools and techniques across the business.
Scaling and growing the export and start-up base continues to be a key priority for Enterprise Ireland. Enterprise Ireland helps SMEs with business planning, mentoring and development advice, feasibility funding and finance.
Enterprise Ireland’s new three-year strategy, launched earlier this year, sets out strategic ambitions for Irish enterprise over the period 2022-2024 and beyond. This includes initiatives to diversify export markets, increase the number of start-ups by 20% and to improve our productivity. I welcome the commitment that both Enterprise Ireland and the LEOs, working together, will ensure that companies of all sizes will be provided with a flexible service model in response to their growth and development needs.
The Government is taking a coordinated approach to ensuring the long-term productivity, competitiveness and growth of our SME sector. The SME and Entrepreneurship Growth Plan, which was published last year, provides us a blueprint, directly from the business community, on how to create a better business and regulatory environment for our SMEs and entrepreneurs.
Implementation of the Growth Plan is focused on the delivery of actions in ten key areas: access to finance; digital transformation; increasing first time exporters; enhanced assistance for high-potential businesses; clustering and networks; SME management skills; reducing the regulatory burden on SMEs; delivery of a single portal for business information and assistance; ensuring comprehensive enterprise agency coverage for SMEs; and increased SME participation in public procurement.
I look forward to the delivery of significant progress in each of these areas in 2022, which will help our SMEs to become more competitive and resilient over the longer term.
203. Deputy Bernard J. Durkan asked the Tánaiste and Minister for Enterprise, Trade and Employment the extent to which he and his Department continues to monitor foreign direct investment here, with particular reference to any impact arising from international corporate tax changes; and if he will make a statement on the matter. [25624/22]
Amharc ar fhreagraIDA Ireland is responsible for the attraction and retention of foreign direct investment in Ireland. IDA Ireland’s performance is mainly measured by the number of greenfield investments it wins and the jobs created. The Department of Enterprise, Trade and Employment continues to work alongside IDA Ireland to support the agency’s performance and to monitor the level of inward investment in Ireland.
IDA Ireland’s end year results for 2021 demonstrate a strong flow of FDI into Ireland, with 249 investments won last year. Growth in regions was particularly notable with 134 of the 249 investments won, i.e. 54%, going to regional locations, with employment growth recorded in every region of the country. Additionally, the number of people directly employed in the multinational sector in Ireland reached 275,384 in 2021. This is the highest level of FDI employment ever reached in Ireland. These investment decisions were taken not only within the context of the OECD International Tax negotiations and agreement, but also during an uncertain international environment due to both Brexit and the COVID-19 pandemic. These results are positive evidence of Ireland’s continued attractiveness as a destination for companies seeking to invest.
Ireland will continue to remain an attractive location for FDI in the future despite the international corporation tax change. Ireland’s signing of the OECD International Tax agreement in July 2021 provided clarity, a long-term view and the assurance of enduring stability and certainty to prospective and current multinational companies investing in Ireland. Furthermore, the corporation tax change will affect a small number of larger companies, however, for the overwhelming majority of enterprises in Ireland, the effect will be nil.
The corporation tax rate is only one element of Ireland’s value proposition to multinational companies. Companies which decide to invest in Ireland also reap the benefits of a young and highly educated workforce, a business-friendly environment, a stable economic and political environment, Ireland’s clear commitment to European Union membership and access to the single market.
204. Deputy Bernard J. Durkan asked the Tánaiste and Minister for Enterprise, Trade and Employment the extent to which the number of potential employees in County Kildare and throughout the country continues to be sufficient to meet the demands of the workplace; the extent to which this continues to be monitored with a view to ensuring the maximisation of opportunities from both the employee’s and employer’s perspective; and if he will make a statement on the matter. [25625/22]
Amharc ar fhreagraRecent CSO data indicates an increase in employment in the Mid-East region of 28,600 for the year to the final quarter of 2021.
The employment recovery nationally coincided with the easing of public health restrictions and the roll out of Ireland’s vaccination programmes, highlighting the importance of the Government’s efforts to assist workers and businesses, especially through those wage supports which helped businesses maintain a link to their staff.
In its ongoing engagement with enterprise, my Department and its agencies have nevertheless been made aware of labour shortages in certain sectors. My Department has worked to signpost businesses towards the training and labour market activation programmes and supports, available through the Department of Further and Higher Education, Research, Innovation and Science, its agencies, and the Department of Social Protection, in order to address their staffing needs.
At a regional level, not just in the Mid-East but across all nine regions, the skills needs of enterprise are monitored on an ongoing basis by the respective Regional Skills Forum. Each forum brings together State, enterprise and education and training stakeholders at local and regional level, with a view to identifying, interrogating and validating skills needs, and to ensuring that employers and enterprises are linked with the appropriate resources across the education and training system.
Some of the emerging skills shortfalls are due to pre-existing structural shifts, which have been accelerated by the impact of the pandemic. The digital and green transitions, and their associated behavioural changes, are altering the economy and leading to permanent changes in our labour market and business models. Not all jobs will return as we recover from the pandemic, while embracing these transitions will open up substantial new employment opportunities, as well as potential skills mismatches as these opportunities initially emerge.
The Government’s Economic Recovery Plan commits to supporting the transition of Ireland’s economy and workforce to the new digital and green economies. This goal will be realised through ongoing support for people in securing and remaining in sustainable and quality employment, in areas of identified skills needs for business. This will be achieved in particular through the combination of 50,000 upskilling and reskilling opportunities set out in the Recovery Plan and increased labour market activation interventions through the Government’s Pathways to Work 2021-2025 strategy.
In the Mid-East region, these upskilling and reskilling efforts, for both existing employees as well as those seeking to integrate or reintegrate in the workforce, will be aligned in particular with the strategic areas identified in the Regional Enterprise Plan to 2024- Mid-East, including digitisation and automation, Advanced Manufacturing/Industry 4.0, the Green Agenda, Agri-food and Screen content creation. Ireland’s economic migration policy also continues to accommodate the arrival of non-EEA nationals to fill skills and labour gaps that emerge across the economy in the short to medium term.
205. Deputy Fergus O'Dowd asked the Minister for the Environment, Climate and Communications if his Department has reviewed the treatment of full-time residents in mobile homes who have been unable to access the €200 electricity rebate payment, without consideration for the income and vulnerability of much of this cohort; and if he will make a statement on the matter. [25419/22]
Amharc ar fhreagraThe Electricity Costs (Domestic Electricity Accounts) Emergency Measures Act 2022 established a scheme for the making in 2022, of a once-off Electricity Costs Emergency Benefit Payment to each domestic electricity account. The credit of €176.22 (excluding VAT) is being applied to all domestic electricity accounts through April and May, and includes prepay meters. This Scheme is in addition to the Government’s longstanding measures to address energy poverty and the protection of vulnerable customers, and is in addition to the measures introduced in the Budget.
As previously advised, where residents of mobile homes hold domestic electricity accounts with a supplier of their choice, they will receive the credit, and do not need to apply for it. In cases where residents of mobile homes hold a tenancy agreement, parties are encouraged to refer tenancy disputes to the Residential Tenancies Board (RTB) for resolution. The RTB encourages parties to work with its mediation service.
Where other arrangements apply, such as a contractual arrangement with an operator of a mobile home park, this is a contractual matter between residents and the operators of these parks.
This credit is an exceptional measure which uses the single eligibility criterion of a meter point registration number, to ensure payments to each domestic electricity account as early as possible in 2022.
The Deputy may also wish to note that Frequently Asked Questions, which include information on additional measures to support people in need of assistance to meet energy costs, are available on gov.ie at: www.gov.ie/en/publication/4ae14-electricity-costs-emergency-benefit-scheme/.
206. Deputy Michael Healy-Rae asked the Minister for the Environment, Climate and Communications his views on the introduction of a scrappage scheme (details supplied); and if he will make a statement on the matter. [25491/22]
Amharc ar fhreagraThe Climate Action Plan set a goal to reduce greenhouse gas emissions from the residential sector from 7 Mt CO2 eq. in 2018 to between 3.5-4.5 Mt CO2 eq. in 2030. The Plan sets out that the Building Regulations will effectively ban the installation of fossil fuel boilers in new homes by the end of 2023 For existing homes the Programme for Government and Climate Action Plan set ambitious targets to retrofit the equivalent of 500,000 homes to a Building Energy Rating (BER) of B2/cost optimal or carbon equivalent and the installation of 400,000 heat pumps in existing homes to replace older, less efficient heating systems by end-2030. This represents approximately 30% of the housing stock and is among the most ambitious retrofit programmes worldwide.
As part of the implementation of the Climate Action Plan and National Retrofit Plan, the Government recently announced a package of supports to make it easier and more affordable for homeowners to undertake home energy upgrades, for warmer, healthier and more comfortable homes, with lower energy bills and lower emissions. Included in these measures was the establishment of the new National Home Energy Upgrade Scheme, offering increased grant levels of up to 50% of the cost of a typical B2 home energy upgrade with heat pump.
The grants which have been made available aim to maximise emissions reductions and deliver energy savings for the widest range of homeowners possible. The grants focus on first reducing energy demand and then switching to electric heating with a heat pump. The grants which are available, and their respective eligibility criteria, were selected as the most likely to deliver significant energy savings to homeowners as well as the best value for money for the Exchequer
The grant supports will be kept under review taking account of: the overarching need to build a much bigger home upgrade sector; evolving science; innovation; evolving technology and other relevant factors. There are no plans to introduce a scheme to support the installation of new condensing boilers in homes.
207. Deputy Catherine Murphy asked the Minister for the Environment, Climate and Communications the annual cost of cleaning and sanitising roofs of buildings under his Department’s control for the past five years to date in 2022. [25586/22]
Amharc ar fhreagraMy Department has not incurred any such costs in the past five years.
208. Deputy Bernard J. Durkan asked the Minister for the Environment, Climate and Communications when an energy conservation grant to facilitate window replacement can be made in the case of a person (details supplied); and if he will make a statement on the matter. [25647/22]
Amharc ar fhreagraThe administration and management of applications under the Sustainable Energy Authority of Ireland (SEAI) schemes are an operational matter for the SEAI. As Minister, I have no function with regard to individual grant applications. The SEAI has established a specific email address for queries from Oireachtas members so that such queries can be addressed promptly, in line with SEAI’s objective to deliver services to the highest standards. The email address is oireachtas@seai.ie
209. Deputy Martin Browne asked the Minister for Transport the provisions that are in place to address the delay in providing NCT appointments (details supplied); and if he plans to provide an extension for those effected by the delay. [25490/22]
Amharc ar fhreagraThe operation of the National Car Test Service (NCTS) is the statutory responsibility of the Road Safety Authority. I have therefore referred the question to the Authority for direct reply. I would ask the Deputy to contact my office if a response has not been received within ten days.
210. Deputy Darren O'Rourke asked the Minister for Transport if additional funding has been provided to Bus Éireann due to the rising cost of fuels; and if he will make a statement on the matter. [25503/22]
Amharc ar fhreagraAs Minister for Transport, I have responsibility for policy and overall funding in relation to public transport in Ireland. Since 2010, the award of Public Service Obligation (PSO) funding falls under the independent statutory remit of the National Transport Authority (NTA). The allocations to the transport operators for the provision of public transport services are decided by the NTA in exercise of its statutory mandate and in accordance with the various contract arrangements that it has in place with PSO service providers.
In light of the NTA's responsibility in this area, I have forwarded the Deputy's specific question in relation to any additional funding that may have been provided to Bus Éireann due to the rising cost of fuels, to the NTA for direct reply. Please advise my private office if you do not receive a response within ten working days.
211. Deputy Darren O'Rourke asked the Minister for Transport the additional funding that has been provided to Local Link services to deal with the rising cost of fuel; the formula that was used to decide on allocations per service, route and company; and if he will make a statement on the matter. [25504/22]
Amharc ar fhreagraAs Minister for Transport, I have responsibility for policy and overall funding in relation to public transport.
The National Transport Authority (NTA) has national responsibility for integrated local and rural transport, including management of the Rural Transport Programme which operates under the TFI Local Link brand.
In light of the NTA's responsibilities for TFI Local Link services, including funding for the cost of fuel, I have referred your question to the NTA for direct reply to you. Please advise my private office if you do not receive a reply within ten working days.
212. Deputy Éamon Ó Cuív asked the Minister for Transport if Ukrainian persons who have moved to Ireland, due to the war there, can drive here on their Ukrainian licences; if not, if they will need to apply for an Irish licence; the process involved; and if he will make a statement on the matter. [25539/22]
Amharc ar fhreagraA person who has been admitted to Ireland under the Temporary Protection Directive cannot drive here on their national licence.
I signed the Road Traffic (Recognition of Foreign Driving Licences) (Ukraine) Order 2022 into law on 22 April 2022. This allows a person with temporary residence in Ireland under the Temporary Protection Directive, because of the conflict in Ukraine, to exchange their Ukrainian driving licence for an Irish licence. The licence will be valid for 12 months and will apply to category B (cars and light vehicles) only.
An application to exchange a licence may be made in any National Driver Licence Service (NDLS) centre. An appointment to attend an NDLS centre can be booked online at www.ndls.ie/booking-service.html or by phone at 0818919090.
Further information on exchanging a foreign driving licence, including the documentation required, can be found at www.ndls.ie.
213. Deputy Sean Sherlock asked the Minister for Transport the steps that car owners in Cork should take in cases in which their NCT has expired and they cannot make a booking for an NCT until October 2022 according to the NCT website. [25543/22]
Amharc ar fhreagraThe operation of the National Car Test Service (NCTS) is the statutory responsibility of the Road Safety Authority. I have therefore referred the question to the Authority for direct reply.
I would ask the Deputy to contact my office if a response has not been received within ten days.
214. Deputy Richard Bruton asked the Minister for Transport if the support scheme for chauffeurs to bring fully-electric vehicles into their fleet has been reduced or suspended; if those now-buying fully-electric vehicles will again become eligible for a rebate soon and the way the rebate will be paid. [25554/22]
Amharc ar fhreagraThe aim of the Electric Small Public Service Vehicle (eSPSV) Grant Scheme is to support the greening of the SPSV sector. It is aimed at improving air quality in urban areas, reducing the CO2 emissions of a sector which typically has very high mileage, and also can positively influence the uptake of zero emission passenger cars by improving general perception and awareness of the benefits of electric vehicles.
The SPSV industry is regarded as a champion in the normalisation of electric vehicle use. The Scheme is funded by the Department and administered by NTA acting as agents of the Department with delegated authority and as the licensing authority for SPSVs. €15m was allocated in 2022 to support SPSVs to switch to electric.
The scheme is kept under continuous review and is currently paused to new applicants to allow for the drawdown and payment of provisional grant offers which usually have a time limit of three months. In addition, applicants can apply for a further three month provisional grant offer extension if they have a letter from their dealer stating that the vehicle will be delivered within this timeframe. Once these grant offers have been drawn down, there will be a clearer picture of the funding available for the second half of the year, and I I anticipate the scheme will reopen for applications in the summer.
215. Deputy Catherine Murphy asked the Minister for Transport the annual cost of cleaning and sanitising roofs of buildings under his Department’s control for the past five years to date in 2022. [25597/22]
Amharc ar fhreagraI can confirm that there has been no expense incurred by my Department for the cleaning and sanistising of roofs under the Departments control for the past five years to date.
216. Deputy Mairéad Farrell asked the Minister for Transport if his Department has been engaging in the dispute between Galway coach station and private coach operators that use the station; the work that has been undertaken by his Department to resolve the dispute; and if he will make a statement on the matter. [25611/22]
Amharc ar fhreagraAs the Minister for Transport, I have responsibility for policy and overall funding in relation to public transport; however, I am not involved in the day-to-day operations of public transport. The National Transport Authority (NTA) has statutory responsibility for securing the provision of public passenger transport services nationally and is responsible for the licensing of public bus passenger services under the provisions of the Public Transport Regulation Act 2009.
Therefore, I have forwarded the Deputy's query in relation to Galway Coach Station to the NTA for direct reply. Please advise my private office if you do not receive a response within ten working days.
217. Deputy Bernard J. Durkan asked the Minister for Finance the number of jobs expected to be created in the wake of the pandemic; and if he will make a statement on the matter. [25621/22]
Amharc ar fhreagraThe COVID-19 pandemic had a severe impact on Ireland’s labour market, with the number of persons in receipt of some form of state income assistance peaking at around 1.2 million in May 2020. More recently, the Government’s labour market policy response, which effectively maintained the employer-employee link to prevent labour market scarring, has paved the way for a rapid recovery in employment.
Indeed, since the phased re-opening of our economy and society at the start of April 2021, the number in employment has increased to the highest level on record, with more than 2.4 million people at work in the final quarter of last year when adjusted for recipients of the pandemic unemployment payment.
The headline unemployment rate fell to 4.8 per cent in April and demand for labour remains robust, with data from online recruiter Indeed.com showing total job postings around 50 per cent ahead of their pre-pandemic level. This is a remarkable outcome, and speaks to the effectiveness of the Government’s economic policies which served to protect incomes, jobs, and businesses.
Forecasts published by my Department with the Stability Programme Update (SPU) in April project strong employment growth in the short-term. While comparisons on an annual average basis are impacted by containment measures during the first quarter of 2021, a significant number of jobs are forecast to be added throughout this year and next. For instance, by the end of 2022 more than 50,000 jobs are projected to have been created when compared to the fourth quarter of 2021. For next year as a whole, an additional 50,000 jobs are expected to be added on average compared with this year. Over the medium-term, employment growth is projected to moderate to just under 2 per cent as the economy moves closer to full employment.
Although the most recent labour market indicators point to continued momentum, risks to the outlook remain, not least the continued international uncertainty and the potential for further fallout from the invasion of Ukraine.
218. Deputy Michael Creed asked the Minister for Finance the current situation of an appeal by a person (details supplied) in County Cork in respect of the refusal of a primary medical certificate. [25436/22]
Amharc ar fhreagraThe Disabled Drivers & Disabled Passengers Scheme provides relief from Vehicle Registration Tax and VAT on the purchase and use of an adapted car, as well as an exemption from motor tax and an annual fuel grant. The Scheme is open to severely and permanently disabled persons as a driver or as a passenger and also to certain charitable organisations. In order to qualify for relief, the applicant must hold a Primary Medical Certificate issued by the relevant Senior Area Medical Officer (SAMO) or a Board Medical Certificate issued by the Disabled Driver Medical Board of Appeal. Certain other qualifying criteria apply in relation to the vehicle, in particular that it must be specially constructed or adapted for use by the applicant. To qualify for a Primary Medical Certificate an applicant must be permanently and severely disabled, and satisfy at least one of the following medical criteria, in order to obtain a Primary Medical Certificate:- be wholly or almost wholly without the use of both legs;- be wholly without the use of one leg and almost wholly without the use of the other leg such that the applicant is severely restricted as to movement of the lower limbs;- be without both hands or without both arms;- be without one or both legs; be wholly or almost wholly without the use of both hands or arms and wholly or almost wholly without the use of one leg;- have the medical condition of dwarfism and have serious difficulties of movement of the lower limbs. In the event that a PMC is not granted by the relevant Senior Area Medical Officer an appeal may be made to the independent Disabled Drivers Medical Board of Appeal (DDMBA) who operate out of the National Rehabilitation Hospital in Dun Laoghaire. I have no role in relation to the granting or refusal of PMCs and the HSE must be independent in their clinical determinations. Following the resignation of all members of the previous Disabled Drivers Medical Board of Appeal an Expression of Interest seeking suitable candidates for the Board closed on 29th April 2022. Applicants are currently being assessed. Requests for appeal hearings can be sent to the DDMBA secretary based in the National Rehabilitation Hospital. New appeal hearing dates will be issued once the new Board is in place. Assessments for the primary medical certificate, by the HSE, are continuing to take place. If an application for a PMC is unsuccessful, another application can be made six months after initial assessment.
219. Deputy Ivana Bacik asked the Minister for Finance if those who have already received the pandemic special recognition payment are not subject to income tax on the €1,000 payment even though the necessary legislation has not been passed by the Houses of the Oireachtas to date; the administrative measures that are in place to ensure same; and if he will make a statement on the matter. [25500/22]
Amharc ar fhreagraAs the Deputy will be aware, on 19 January 2022 the Government announced a COVID-19 recognition payment for eligible frontline healthcare workers to recognise their unique role during the pandemic. The resulting “Pandemic Special Recognition Payment” of up to a maximum of €1,000 per individual is to be made to specified categories of frontline healthcare workers. The Government has committed that this payment will not be subject to income tax, USC, or PRSI. It is expected that the legislation providing for the tax exemption, which is contained in section 3 of the Finance (COVID-19 and Miscellaneous Provisions) Bill 2022, will be enacted shortly. In the meantime, Revenue has advised me that it is providing for the tax exemption to be applied under its care and management provisions in section 849 of the Taxes Consolidation Act 1997. This permits any Pandemic Special Recognition Payment to be made to a qualifying frontline healthcare worker without deduction of income tax, USC and PRSI. The legislation contained in section 3 of the Finance (COVID-19 and Miscellaneous Provisions) Bill 2022, when enacted, is worded to the effect that all Pandemic Special Recognition payments made under the Government’s scheme will be exempt from tax and so will also cover any payments already made.
Revenue advises me that any Pandemic Special Recognition Payment already made to a qualifying frontline healthcare worker is covered under Revenue’s care and management provisions, therefore permitting the payment to be made without deduction of income tax, USC and PRSI.
For the Deputy's information, on 17 May 2022, Revenue issued eBrief 110/22 on this topic. It is publicly available at https://www.revenue.ie/en/tax-professionals/ebrief/2022/no-1102022.aspx.
220. Deputy Pearse Doherty asked the Minister for Finance the benefit conferred on persons with respect to the expansion of the debt warehousing scheme for directors and employees with material interest, impacted by section 997A of the Taxes Consolidation Act 1997 through legislative changes to the Finance Bill 2021; the potential impact on such persons had these changes not been introduced; and if he will make a statement on the matter. [25549/22]
Amharc ar fhreagraSection 997A of the Taxes Consolidation Act 1997 (TCA) is a long-standing anti-avoidance measure introduced in 2005. It applies to directors or employees who have a “material interest” in their employer company. This section denies such directors or employees a credit for tax deducted from their remuneration when filing their income tax return, until such time as the tax has been remitted to the Collector-General by their employer company.
Section 997A TCA has not been disapplied in debt warehousing cases, so employees and directors who are subject to section 997A cannot have a credit for tax deducted if their employers have warehoused the PAYE liabilities due on their salaries.
Finance Act 2021 made two changes to the debt warehousing scheme for individuals in this position.
The first change was an amendment to section 1080B TCA, which is the warehousing section for income tax liabilities. This change was to take account of the fact that some employees and directors to whom section 997A applies would not be able to warehouse their income tax liabilities in their own right, if their income in either 2020 or 2021 was not at least 25% lower than their income for 2019, the last full year before the Covid-19 pandemic.
The amendment permitted individuals in this position to warehouse the tax due on their own employment (Schedule E) income only, provided that their employer had also warehoused the PAYE (employment) liability for that employment. If this change had not been introduced, such individuals would have been liable to interest charges for late payment and might also have been in default of their preliminary tax obligations.
The second change was the introduction of a new section 1080C TCA. In cases where a taxpayer is subject to section 997A and the taxpayer’s employer has not remitted the tax due on the individual’s salary to Revenue, both the employer and the individual are liable to interest for late payment on the unpaid tax. Section 1080C provides that, in debt warehousing cases only, there will not be a “double interest” charge and only the employer will be liable for interest on the liabilities relating to the individual’s salary. However, if the employer fails to pay the interest (for example, if the employer company is liquidated) the individual will be liable for interest on late payment, as well as for the tax if that is also unpaid.
The purpose of the changes in Finance Act 2021 is to prevent directors and employees with a material interest in a company from being unfairly impacted by the interaction of the debt warehousing provisions, the section 997A anti-avoidance measure and their own tax obligations. The changes introduced are narrow in their scope and application.
As with all liabilities in the debt warehouse, no interest was charged during Period 1, which expired on 31 December 2021 in most cases; no interest is charged in Period 2, which ends for most cases on 31 December 2022; and interest will be charged at 3% per annum from 1 January 2023 until the liability is paid in full. For taxpayers who continued to avail of certain Covid-19 supports, Period 1 was extended to 30 April 2022 and the end date of Period 2 was pushed back to 30 April 2023, meaning the 3% interest rate is charged in those cases from 1 May 2023.
