Written Answers Nos. 355-392
357. Deputy Carol Nolan asked the Minister for Finance if he will maintain the 12.5% excise reduction rate in budget 2023 in order to assist the Irish road haulage and transport sector; and if he will make a statement on the matter. [42639/22]
Amharc ar fhreagra359. Deputy Carol Nolan asked the Minister for Finance if he will retain and enhance the diesel rebate scheme; and if he will make a statement on the matter. [42642/22]
Amharc ar fhreagraI propose to take Questions Nos. 357 and 359 together.
As the Deputy will be aware, it is a longstanding practice of the Minister for Finance not to comment, in advance of the Budget, on any tax matters that might be the subject of Budget decisions.
358. Deputy Carol Nolan asked the Minister for Finance if he will support measures aimed at tackling the increased cost of AdBlue reliefs; and if he will make a statement on the matter. [42640/22]
Amharc ar fhreagraThe Finance Act 1999 provides for the application of an excise duty known as Mineral Oil Tax (MOT) to specified mineral oils, such as petrol, diesel, and kerosene, that are used as fuel for motor or heating purposes. MOT also applies to fuel additives that can be added to fuel for purposes such as extending fuel or improving performance.
I understand that the product mentioned by the Deputy is a diesel exhaust fluid and that such products are injected into the exhaust system of a diesel engine to lower harmful emissions. Diesel exhaust fluid is generally stored in a dedicated tank separate to a vehicle’s fuel tank and is not mixed with fuel. In such circumstances, as the diesel exhaust fluid is neither a fuel additive nor is it used as a fuel, it does not fall within scope of MOT law, i.e. MOT does not apply.
In relation to Value-Added Tax (VAT), the VAT rating of goods and services is subject to EU VAT law, with which Irish VAT law must comply. In general, the EU VAT Directive provides that all goods and services are liable to VAT at the standard rate unless they fall within Annex III of the Directive, in respect of which Member States may apply either one or two reduced rates of VAT. Ireland currently operates two reduced rates of VAT, 13.5% and 9%, as permitted by the Directive.
Diesel exhaust fluid is not included in the categories of goods and services on which the EU Directive allows a lower rate of VAT or an exemption to be applied, and so it is liable to VAT at the standard rate, currently 23%. There is no discretion under the Directive for Ireland to apply a reduced rate of VAT to diesel exhaust fluid.
360. Deputy Carol Nolan asked the Minister for Finance if he plans to reform the taxation of HVO and biofuel for HGVs; and if he will make a statement on the matter. [42644/22]
Amharc ar fhreagraI understand that the Deputy is asking about the taxation of hydrotreated/hydrogenated vegetable oil (HVO) and other biofuels used as motor fuel in heavy goods vehicles (HGVs).
The Finance Act 1999 provides for the application of an excise duty to specified mineral oils, such as petrol, diesel, and kerosene, that are used as motor or heating fuels. This excise duty is called Mineral Oil Tax (MOT) and comprises a carbon and a non-carbon component. The carbon component is commonly referred to as carbon tax and the non-carbon component is often referred to as “excise”, “fuel excise” or “fuel duty”. The table below provides the current MOT rates for petrol, auto-diesel, and natural gas used as a propellant (referred to vehicle gas).
|
Fuel Type |
MOT non-carbon |
MOT carbon |
Total MOT |
|
Petrol |
€371.11 per 1,000L |
€94.87 per 1,000L |
€465.98 per 1,000 per 1,000 litres |
|
Auto-diesel |
€295.64 per 1,000L |
€109.74 per 1,000L |
€405.38 per 1,000 per 1,000 litres |
|
Vehicle gas |
€1.95 per MWh |
€7.41 per MWh |
€9.36 per megawatt hour (MWh) |
Biofuels are products that are made of biomass of animal or vegetal origin. Liquid biofuels, such as HVO, are taxed at the MOT rate that applies to the fuel they are used in place of. For example, biofuel used in place of auto-diesel in a motor vehicle would be taxed at the MOT rate for auto-diesel.
MOT law provides for a relief for biofuels from the carbon component of MOT. This means that biofuel produced entirely from biomass is liable for the non-carbon component of MOT only. In the case of such a biofuel used in place of auto-diesel, the MOT carbon component of €109.74 per 1,000 litres is fully relieved and the applicable MOT rate is €295.64 per 1,000 litres. With regard to blended fuels produced partially from biomass, the relief applies to the portion of fuel that meets the biofuel criteria set out in MOT legislation. The biofuel relief is intended to promote a higher level of biofuel for transport use and supports Government’s commitment to incentivising more environmentally friendly alternatives to fossil fuels.
In relation to Value-Added Tax (VAT), the VAT rating of goods and services is subject to EU VAT law, with which Irish VAT law must comply. In general, the EU VAT Directive provides that all goods and services are liable to VAT at the standard rate unless they fall within Annex III of the Directive, in respect of which Member States may apply either one or two reduced rates of VAT. Ireland currently operates two reduced rates of VAT, 13.5% and 9%, as permitted by the Directive.
Motor fuels such as petrol including bio-ethanol petrol blends and auto-diesel are not included in the categories of goods and services on which the EU Directive allows a lower rate of VAT or an exemption to be applied, and so they are liable to VAT at the standard rate, currently 23%.
The Deputy may be interested to know that VAT registered businesses are entitled to recover the cost of VAT on the purchase of diesel, used in the course of their business, as is the case with most business costs. However, the VAT Consolidation Act provides that VAT on petrol is not recoverable, including by businesses registered for VAT, except where the petrol is purchased as stock-in-trade of the business.
With regard to reform of taxation of biofuels, the Deputy will be aware, it is a longstanding practice of the Minister for Finance not to comment, in advance of the Budget, on any tax matters that might be the subject of Budget decisions.
362. Deputy Louise O'Reilly asked the Minister for Finance if he will confirm the arrangements in place for employees who worked full-time during the pandemic where their employer was in receipt of a wage subsidy and topped up the employee's wage to their normal full-time wage and are now faced with a tax bill for unpaid tax during this period; if the liability is for the employer or the worker; and if he will make a statement on the matter. [42706/22]
Amharc ar fhreagraThe Temporary Wage Subsidy (TWSS) was in place between 26 March and 31 August 2020 and was introduced as an emergency income support for employees of vulnerable firms whose businesses had been negatively impacted by COVID restrictions and whose turnover had reduced by at least 25% during Q2 while the strictest public health measures were in place. The support was paid via the employer so as to maintain employment links between the employee and employer insofar as was possible and, to that end, the rate of Employers' PRSI was also significantly reduced to 0.5%. It should be noted that there was no legal requirement for a minimum amount that the employer had to pay as a normal wages payment to an employee to top up the wage subsidy.
Payments made to employees under the TWSS were regarded as income supports and share the characteristics of income. Other income earners in receipt of comparable “normal wages” are taxable on those wages. In the interest of equity, therefore, payments under the TWSS were subject to income tax and the Universal Social Charge for the employee. While income tax and USC on most income is deducted in real-time as and when the person is paid, the TWSS payments were not taxed in real-time and were instead liable to income tax and USC at the end of 2020.
I am advised that Revenue has made a Preliminary End of Year Statement available to all employees, including those who were in receipt of the TWSS, in respect of 2020. The Preliminary End of Year Statement includes information relating to an employee’s income received, including pensions and income from the Department of Social Protection, as well as their tax credit entitlements. For the tax year 2020, the Statement also includes information on the amounts of TWSS payments, if any, received by each employee. In addition, the Statement provides each employee with a preliminary calculation of the income tax and USC position for 2020 and indicates whether the employee’s tax position is balanced, underpaid or overpaid for the year.
Upon viewing the Preliminary End of Year Statement through MyAccount, which is Revenue’s secure online facility for individual taxpayer services, employees have an opportunity to update their personal record, declare any additional income and claim any additional tax credits due, for example qualifying health expenses, to arrive at their final liability for 2020.
Where a liability is finalised, individuals may opt to fully or partially pay any income tax and USC liability through the Payments/Repayments facility in MyAccount. Where individuals do not opt to fully or partially pay, Revenue will generally collect the liability by reducing their tax credits over 4 years, interest free.
While the income tax and USC liabilities arising from TWSS payments were that of the employee, I am advised that Revenue also facilitated employers who wished to pay some or all of the employees' 2020 TWSS-related tax and USC liabilities. Where the employer opted to pay, Revenue did not apply benefit-in-kind rules to these payments. It should be noted that this concession was initially limited to payments made by employers on behalf of their employees up to end June 2021, but was extended until the end of September 2021. Further details on this facility are available on the following revenue link:
www.revenue.ie/en/employing-people/twss/employers/index.aspx
The TWSS was replaced by the Employment Wage Subsidy Scheme (EWSS) from 1 September 2020. However, the EWSS was paid directly to eligible employers in respect of qualifying employees and, consequently, EWSS re-established the normal requirement to operate PAYE in real-time on salary paid to the employee by the employer. This ensured employee social insurance contributions accumulated as normal and furthermore, that no additional tax or USC liability accrued on the salary payments made to employees.
364. Deputy Ged Nash asked the Minister for Finance the status of the compliance programme for the employment wage subsidy scheme; the number of employers that have been inspected; the number of cases requiring further investigation; the number of employers that have been sanctioned; and if he will make a statement on the matter. [42725/22]
Amharc ar fhreagraSection 28B of the Emergency Measures in the Public Interest (Covid-19) Act 2020 provided for the Employment Wage Subsidy Scheme (EWSS) which was an economy-wide enterprise support for eligible businesses in respect of eligible employees. Eligibility was based on the employer demonstrating that the employer’s business was likely to experience a 30% reduction in turnover or customer order values during a specific reference period and that this disruption to business was caused by the Covid-19 pandemic. The business was also required to have tax clearance.
At the end of each month, from the introduction of the Scheme in August 2020 onwards, each employer availing of the scheme was required to carry out a self-review of its business circumstances having regard to the eligibility conditions for qualification for the scheme, and where the eligibility requirements were no longer satisfied, then the employer was required to immediately cease claiming wage subsidy payments. For the months of July to December 2021 inclusive, employers provided to Revenue details of this eligibility review on a monthly Eligibility Review Form (ERF) filed through ROS.
Revenue’s administration of the scheme was on a self-assessment basis, with employers claiming the subsidy through their payroll submission to Revenue. If employers subsequently determined they were not eligible, or they wished to voluntarily remove themselves from the scheme, they did so through their payroll submission and repaid the subsidies claimed.
I am advised by Revenue that it has it undertaken a multi-faceted risk-based approach to compliance checks to safeguard the integrity of the EWSS. This included real time checking of payroll submissions and cross-referencing claim data against other Revenue data sources to identify anomalies or trends requiring attention. The real time checking procedures were supported by engagement with employers, to facilitate timely resolution of issues, and to ensure employers claimed the correct EWSS entitlement, or ceased claiming where they no longer had an entitlement.
I am advised that Revenue is continuing this risk-focused programme of compliance interventions. Over 7,700 registered employers have been subject to a compliance check to date of which 3,013 have been the subject of recoupment of some or all of their subsidies totalling €68.6m.
In late Q2 of this year, Revenue invited some 42,500 employers who received subsidy payments to perform a final self-review of their EWSS eligibility for all periods of the scheme, utilising an excel based calculator which is available on the Revenue website. Any overclaims identified by employers by 30th September 2022 will be dealt with without the imposition of interest or penalties and declared liabilities and may be included in the Debt Warehouse by those employers who are eligible to participate in Revenue’s Debt Warehousing facility.
365. Deputy Ged Nash asked the Minister for Finance if he will provide an update on the tax liabilities issued to workers whose employer wrongly availed of the temporary wage subsidy scheme; the number of firms and workers affected, respectively; the total tax repayment by workers in such circumstances and the average tax liability issued per worker; and if he will make a statement on the matter. [42726/22]
Amharc ar fhreagraI am advised by Revenue that the Temporary Wage Subsidy Scheme (TWSS), which operated from March to August 2020 involved the payment of subsidies totalling €2.8bn to over 67,000 employers to support the continued employment of over 689,000 employees.
I am further advised that all subsidy amounts paid by employers to employees were liable to income tax irrespective of the whether an employer was eligible under the scheme or not. Revenue conducted an extensive compliance campaign to ensure that employers claiming subsidies under the scheme were properly eligible in accordance with the qualifying conditions for the scheme. This campaign identified a generally high level of compliance with the relevant conditions although some 2.8% of employers (1,889) were found to be ineligible for some or all of the periods for which they claimed subsidies leading to the recovery of subsidies amounting to over €34m.
Where Revenue recouped ineligible subsidies from employers it was then a matter for employers as to whether to seek to recover these sums from their employees. Any such recovery would have been treated as a reduction in emoluments paid to the employees with a consequent reduction in income tax liability. There was no requirement for employers to report any such recovery from employees to Revenue and therefore Revenue does not have the necessary data to provide answers to the specific questions put by the Deputy.
366. Deputy Ged Nash asked the Minister for Finance the number of employers that availed of the temporary Covid-19 wage subsidy scheme and the employment wage subsidy scheme that have been contacted by the Revenue Commissioners regarding repayments; the total amount of repayments due from employers under each scheme; and the total amount collected to date in tabular form. [42727/22]
Amharc ar fhreagra367. Deputy Ged Nash asked the Minister for Finance if he will provide an update on dividend withholding tax returns filed by temporary Covid-19 wage subsidy scheme and the employment wage subsidy scheme claimant companies in respect of distributions made in 2021 and to date in 2022; and if he will make a statement on the matter. [42728/22]
Amharc ar fhreagra368. Deputy Ged Nash asked the Minister for Finance further to Parliamentary Question No. 74 of 28 April 2022, the number of companies that availed of the temporary Covid-19 wage subsidy scheme and the employment wage subsidy scheme that filed dividend withholding tax returns; the number of companies in receipt of State support that filed DWT returns; the total gross subsidy payment received by companies that filed DWT returns; the number of companies to date which have fully or partially returned subsidies and the total amount returned; and if he will make a statement on the matter. [42729/22]
Amharc ar fhreagra370. Deputy Ged Nash asked the Minister for Finance the number of companies that availed of the Covid-19 restrictions support scheme which subsequently filed dividend withholding tax returns; the number of companies in receipt of State support that filed DWT returns; the total gross subsidy payment received by companies that filed DWT returns; and if he will make a statement on the matter. [42731/22]
Amharc ar fhreagraI propose to take Questions Nos. 366 to 368, inclusive, and 370 together.
The Temporary Wage Subsidy Scheme (TWSS) was provided for in section 28 of the Emergency Measures in the Public Interest (COVID-19) Act 2020, as amended, and the Employment Wage Subsidy Scheme (EWSS) was provided for in section 28B of that Act, as amended. Both of these economy-wide supports played a central role in helping to maintain the link between employers and employees between March 2020 and May 2022. TWSS provided supports to over 689,000 employees linked to almost 67,500 employers throughout the scheme. EWSS provided supports to almost 52,000 employers to secure employment for nearly 746,000 employees.
As regards eligibility for the schemes, an employer must have been able to demonstrate, to the satisfaction of Revenue, that its business experienced a decline of turnover or customer order values of 25% and 30% for TWSS and EWSS respectively, and that the decline in trade was as a result of a disruption to business caused by the Covid-19 pandemic. Furthermore, the employer was required to have a valid tax clearance certificate to be eligible to join the EWSS and to continue to meet the requirements for tax clearance throughout the scheme.
From June 2020, Revenue engaged in a phased programme of compliance checks on all TWSS participating employers. The compliance checks are now substantially complete with 13 checks ongoing. In March 2021 Revenue, using data provided by employers to Revenue via their payroll submissions, calculated the total TWSS subsidy paid to each employer, the total TWSS subsidy payable in respect of each employee and the total TWSS subsidy paid by the employer to their employees. The results of this reconciliation exercise are reflected in the table below.
Revenue undertook a risk-focused program of compliance interventions to safeguard the integrity of the EWSS. In late Q2 of this year, Revenue invited some 42,500 employers who received subsidy payments to perform a final self-review of their eligibility for all periods of the scheme and to repay any subsidy monies incorrectly claimed before 30 September 2022. To date, €3.3m subsidy has been repaid by 281 employers following that invitation.
The following is the overall position regarding subsidy payments and repayments made by employers under the wage subsidy schemes.
|
- |
EWSS |
TWSS |
|
Total recipients |
51,800 |
67,232 |
|
Total paid |
€7bn |
€2.8bn |
|
Contacts made regarding repayment issues |
7,728 |
38,049 |
|
Total repayment value agreed following contact |
€78.2m |
€258m |
|
Compliance contacts regarding repayments not yet resolved |
1,708 |
13 |
|
Repayments agreed with employers and included in the Debt Warehouse scheme |
€37m |
€50m |
|
Recipients who have returned all subsidies (amount repaid) |
542 (€57m) |
696 (€7.2m) |
|
Recipients who partially repaid subsidies (amount repaid) |
4,269 (€76.8m) |
31,300 (€258m) |
The Covid Restrictions Support Scheme (CRSS) was introduced by Section 11 of the Finance Act 2020 as a targeted support for businesses significantly impacted by restrictions introduced by the Government under public health regulations to combat the effects of the COVID-19 pandemic. It was available to entities who carried on a trade or trading activities, the profits of which are chargeable to tax under Case 1 of Schedule D. CRSS provided € 719m in support to over 22,000 businesses in respect of approximately 25,000 premises.
In order to be eligible for the CRSS, a number of conditions must have been satisfied, including that the person carrying on the business must have had an up-to-date tax clearance certificate throughout the scheme. In order to qualify for the CRSS following December 2021 restrictions, hospitality and indoor entertainment sectors qualified where the turnover from the relevant business activity in the period for which the restrictions were in operation was no more than 40% of the average turnover in a reference period.
The eligibility criteria for the schemes, as provided for in legislation, did not include any conditions regarding a company making distribution payments to shareholders. Companies making distributions have obligations to deduct and return Dividend Withholding Tax (DWT). DWT applies to a wide range and different types of distributions. This includes both intra-group distributions and dividends paid to shareholders, including both cash and non-cash distributions (e.g. distributions made in the form of the issue of additional shareholdings). The DWT return does not distinguish between these different forms of taxable distribution, nor does it set out the accounting period to which distributions may relate. Therefore, I am advised by Revenue that it is not possible to determine whether distribution payments relate to profit reserves earned before or during the pandemic.
Revenue carried out a short exercise to identify DWT returns filed by EWSS claimant companies in respect of distributions made in 2021. This showed that 866 employers, out of a total of nearly 50,000 who received EWSS payments, filed DWT returns advising of some form of distribution during 2021. However, it was not possible to determine whether the distributions were cash or non-cash in nature or whether any dividends were paid to shareholders. At that time, the 866 companies had received gross EWSS subsidy payments of € 396 m. 29 of these employers have returned all subsidies received totalling €28.7m while 121 have partially repaid EWSS received amounting to €8.6m.
There was and is no link or conditionality between eligibility for the schemes and the payment of distributions by companies. For that reason, and having regard to the considerations as outlined, I am advised by Revenue that the aforementioned exercise has not been repeated for 2022 or for recipients of any other subsidies, nor are there plans to do so.
It should be noted that the majority of companies that participated in the subsidy schemes did so because they had a reasonable expectation that their business would suffer a decline in turnover or customer orders as a decline in trade caused by the pandemic. I am satisfied that the schemes operated as effective and responsive instruments both to keep the economy afloat during the pandemic and aid economic recovery post pandemic.
369. Deputy Ged Nash asked the Minister for Finance the status of the compliance programme for the Covid-19 restrictions support scheme; the number of employers that have been inspected; the number of cases requiring further investigation; the number of employers that have been sanctioned; and if he will make a statement on the matter. [42730/22]
Amharc ar fhreagraThe Covid Restrictions Support Scheme (CRSS), which was introduced by Section 11 of the Finance Act 2020, was a targeted support for businesses significantly impacted by restrictions introduced by the Government to combat the COVID-19 pandemic.
The scheme was available to companies, self-employed individuals and partnerships who carried on a trade or trading activities from a business premises that was subjected to restrictions that prohibited or considerably restricted customer access. The scheme was designed to help traders meet their costs at a time when they could not provide goods or services to their customers from their business premises, or could only do so to a limited extent, due to COVID-19 related restrictions. It was not a condition of the CRSS that a business had to be an employer to be eligible for the scheme.
The CRSS operated on a self-assessment basis, and claimants were required to satisfy themselves that they were correctly eligible for the scheme before registering for it or claiming payments. Claimants had to undergo a two-stage verification process, with compliance managed in real-time at each stage. They were first required to register for the scheme and make a self-declaration in relation to their eligibility. They were then required to review their continued eligibility for the scheme before making a claim for payment in respect of each claim period. Furthermore, to qualify for the CRSS, all businesses were required to hold tax clearance and compliance checks on this were undertaken in all cases, with no business being allowed access to the scheme in the absence of tax clearance.
I am advised that Revenue risk assessed applicants at both registration and payment stage through a combination of systemised and manual verification checks. In total, approximately 26,000 taxpayers applied for the scheme. The eligibility and compliance checks undertaken resulted in almost 4,000 applicants being refused entry to the scheme.
Where Revenue formally determined that an applicant was not eligible for the CRSS, the legislation governing the scheme afforded an applicant the right to appeal this determination to the Tax Appeals Commission which is an independent statutory body. A total of 76 appeals relating to CRSS were received by the Tax Appeals Commission.
Claimants who qualified for the scheme had the facility to submit claims in advance which, in a small number of cases, resulted in overpayments as the public health restrictions sometimes changed at short notice. Where overpayments arose, Revenue has engaged with the businesses concerned to recoup any monies due. Revenue has confirmed that, where repayment of the amount owed as a single payment could cause financial difficulties for the business, engagement takes place to agree a suitable solution, including the option to spread repayments over a period of time.
A list of businesses that received payments under the CRSS was published on www.revenue.ie in May 2022.
371. Deputy Alan Kelly asked the Minister for Finance when a new medical appeals board will be appointed following the resignation of the previous board in November 2021 given that there is a backlog of appeals to be heard; and if he will make a statement on the matter. [42736/22]
Amharc ar fhreagraThe Disabled Drivers & Disabled Passengers Scheme provides relief from Vehicle Registration Tax and VAT on 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. To qualify for a Primary Medical Certificate an applicant must be permanently and severely disabled, and satisfy at least one of the six medical criteria.
I have no role in relation to the granting or refusal of PMCs and the HSE and the Medical Board of Appeal must be independent in their clinical determinations.
As of 15th August 2022 (latest data available) there are 638 requests for appeal hearings outstanding.
Following the resignation of all members of the previous Disabled Drivers Medical Board of Appeal, effective from 30th November 2021, two Expression of Interest campaigns have been held, seeking suitable candidates for the Board. The Department of Health leads on all actions and tasks with respect to the Expression of Interest Campaigns. Department of Finance officials provide support to the Department of Health in this matter.
The first campaign closed on 29th April. As there were insufficient suitable candidates arising from the first campaign, a second round was issued with a closing date of 5th July 2022. Processes to support the nomination of suitable candidates are nearing completion. Once these processes have been completed the Minister for Finance will then be in a position to appoint any suitable Department of Health nominee to the Board. When the new Board is up and running, it will consider the best way of ensuring outstanding appeals are addressed as quickly as possible.
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.
372. Deputy Catherine Murphy asked the Minister for Finance the number of new properties brought within the scope of local property tax charges in 2022; and the local property tax yield from same. [42817/22]
Amharc ar fhreagraIt is assumed the Deputy is referring to properties that were not liable to Local Property Tax (LPT) in years prior to 2022 as they are either new or were previously exempted.
I am advised by Revenue that, based on returns filed to date, the number of properties brought within the scope of local property tax charges for the first time in 2022 currently stands at 108,744. The associated liability to the tax is €37.3 million. This information is provisional and likely to be revised as additional returns are filed.
373. Deputy Catherine Murphy asked the Minister for Finance the totality of grant aid and-or subsidy provided to each local authority in 2019, 2020, 2021 and to date in 2022 (details supplied). [42827/22]
Amharc ar fhreagraI wish to advise the Deputy that my Department did not provide any grant-aid and or subsidy to any local authority in 2019, 2020, 2021 or to date in 2022.
374. Deputy Jim O'Callaghan asked the Minister for Finance if dog grooming can qualify for the reduced VAT rate permitted under Annexe III of the VAT directive; and if he will make a statement on the matter. [43346/22]
Amharc ar fhreagraThe provision of dog grooming services is not included in Annex III and as such is subject to the standard rate of VAT, currently 23%. There is no discretion under the Directive for Ireland to apply a reduced rate of VAT to this service.
The Deputy may be interested to know that by way of special derogation from the general rule, Ireland is permitted to continue its long-standing practice of applying a reduced rate, currently 13.5%, to the supply of services by a veterinary surgeon in the course of their profession, but there are strict restrictions on this derogation, including that the rate cannot be reduced below 12%. However, where a veterinary surgeon carries out a dog grooming services as part of the veterinary procedure, such as treating an illness or disease, the dog grooming is considered part of the veterinary procedure and the entire procedure is liable to VAT at the reduced rate. Where a veterinary surgeon provides a dog grooming service as a supply that is distinct from a veterinary procedure the service is liable to VAT at the standard rate of 23%.
375. Deputy Catherine Murphy asked the Minister for Finance if he will provide any work undertaken in respect of forecasting revenue realised from the collection of local property tax in future years. [42840/22]
Amharc ar fhreagraLocal Property Tax (LPT) is a self-assessed tax charged on the market value of residential properties in the State. LPT is collected by Revenue.
The LPT yield is estimated to be €490m in 2022. It is anticipated that the LPT yield will increase marginally annually, as new housing units are completed and enter the scope of the tax.
The Deputy may wish to note that Revenue publishes a comprehensive range of quarterly and annual statistics relating to LPT on its website, including information regarding exemptions from the tax, at www.revenue.ie/en/corporate/information-about-revenue/statistics/local-property-tax/index.aspx.
377. Deputy Carol Nolan asked the Minister for Finance if it is the policy of his Department to support the competitiveness of the tourism sector through the retention of the 9% VAT rate until full recovery is secured; and if he will make a statement on the matter. [42951/22]
Amharc ar fhreagraAs the Deputy will be aware, it is a longstanding practice that the Minister for Finance does not comment, in advance of the Budget, on any tax matters that might be the subject of Budget decisions.
378. Deputy Carol Nolan asked the Minister for Finance if he will support policy measures to ensure that car hire supply can be increased by the restoration of the repayment of VAT on vehicle registration tax; and if he will make a statement on the matter. [42952/22]
Amharc ar fhreagraAs the Deputy will be aware, it is a longstanding practice of the Minister for Finance not to comment, in advance of the Budget, on any tax matters that might be the subject of Budget decisions.
379. Deputy Catherine Connolly asked the Minister for Finance his plans to assist those earning between €20,000 and €30,000 to deal with the cost-of-living crisis; and if he will make a statement on the matter. [43015/22]
Amharc ar fhreagraThe Government is acutely aware of the cost pressures facing taxpayers, especially the increase in fuel and other energy prices. Government has acted swiftly, and frequently, to address the cost of living issue. Since Budget 2022, measures of approximately €2.4 billion have been introduced to ease the burden.
However, it is important to recognise the reality that the current inflationary environment is, primarily, driven by global pressures. As such Government cannot fully ease the burden of the rising cost of living.
It is also essential that fiscal policy itself does not become part of the problem: inappropriate policy could lead to second-round effects, counterproductively adding to inflation and increasing the vulnerability of the public finances. Therefore, Government policy will focus on temporary and targeted measures, aimed at those most in need.
The Government must also strike the balance between intervening today and keeping our public finances on a positive trajectory in the future. The need for a credible fiscal strategy for rebuilding fiscal buffers takes on an increased urgency in the context of multiple challenges facing the public finances including elevated levels of public debt, rising borrowing costs and significant medium-term expenditure pressures.
In the Summer Economic Statement, the Government adapted its budgetary strategy for next year on a once-off basis to take into account the much less benign inflationary environment. Reflecting this, Budget 2023 will be a ‘cost of living’ Budget, predominately focused on helping to ease the burden of inflation. Budget 2023 will provide for an overall package of €6.7 billion; this has been calibrated to balance the need to provide further support with the need to avoid adding to inflationary pressures. As the Deputy will appreciate, it would not be appropriate for me to speculate on policy decisions in advance of Budget Day.
380. Deputy Bernard J. Durkan asked the Minister for Finance if he will clarify the date that all outstanding liabilities were paid for 2019 and 2020 in the case of a person (details supplied); and if he will make a statement on the matter. [43052/22]
Amharc ar fhreagraI am advised by Revenue that all outstanding liabilities for the individual for the years 2019 and 2020 were paid.
381. Deputy Niall Collins asked the Minister for Finance when the Disabled Drivers Medical Board of Appeal will be in place; and if he will make a statement on the matter. [43058/22]
Amharc ar fhreagraThe Disabled Drivers & Disabled Passengers Scheme provides relief from Vehicle Registration Tax and VAT on 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. To qualify for a Primary Medical Certificate an applicant must be permanently and severely disabled, and satisfy at least one of the six medical criteria.
I have no role in relation to the granting or refusal of PMCs and the HSE and the Medical Board of Appeal must be independent in their clinical determinations.
Following the resignation of all members of the previous Disabled Drivers Medical Board of Appeal, effective from 30th November 2021, two Expression of Interest campaigns have been held, seeking suitable candidates for the Board. The Department of Health leads on all actions and tasks with respect to the Expression of Interest Campaigns. Department of Finance officials provide support to the Department of Health in this matter.
The first campaign closed on 29th April. As there were insufficient suitable candidates arising from the first campaign, a second round was issued with a closing date of 5th July 2022. Processes to support the nomination of suitable candidates are nearing completion. Once these processes have been completed the Minister for Finance will then be in a position to appoint any suitable Department of Health nominee to the Board. When the new Board is up and running, it will consider the best way of ensuring outstanding appeals are addressed as quickly as possible.
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.
382. Deputy Michael Lowry asked the Minister for Finance if provisions will be prioritised in budget 2023 for the removal of VAT from defibrillators as requested in a pre-budget submission by an organisation (details supplied); and if he will make a statement on the matter. [43062/22]
Amharc ar fhreagraThe contents of this pre-Budget submission from the Irish Heart Foundation will be considered as part of the budgetary process.
As the Deputy will be aware, it is a longstanding practice that the Minister for Finance does not comment, in advance of the Budget, on any tax matters that might be the subject of Budget decisions.
383. Deputy Niamh Smyth asked the Minister for Finance if an appeal by a person will be reviewed (details supplied); the status of same; and if he will make a statement on the matter. [43066/22]
Amharc ar fhreagraThe Disabled Drivers & Disabled Passengers Scheme provides relief from Vehicle Registration Tax and VAT on 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. To qualify for a Primary Medical Certificate an applicant must be permanently and severely disabled, and satisfy at least one of the six medical criteria.
I have no role in relation to the granting or refusal of PMCs and the HSE and the Medical Board of Appeal must be independent in their clinical determinations.
Following the resignation of all members of the previous Disabled Drivers Medical Board of Appeal, effective from 30th November 2021, two Expression of Interest campaigns have been held, seeking suitable candidates for the Board. The Department of Health leads on all actions and tasks with respect to the Expression of Interest Campaigns. Department of Finance officials provide support to the Department of Health in this matter.
The first campaign closed on 29th April. As there were insufficient suitable candidates arising from the first campaign, a second round was issued with a closing date of 5th July 2022. Processes to support the nomination of suitable candidates are nearing completion. Once these processes have been completed the Minister for Finance will then be in a position to appoint any suitable Department of Health nominee to the Board. When the new Board is up and running, it will consider the best way of ensuring outstanding appeals are addressed as quickly as possible.
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.
384. Deputy Ged Nash asked the Minister for Finance if the Government will introduce a new short-time work furlough scheme based on the principles of the employment wage subsidy scheme to maintain manufacturing jobs at risk of being lost as a result of escalating gas prices, especially in view of the risk to all of the jobs at companies (details supplied); and if he will make a statement on the matter. [43090/22]
Amharc ar fhreagraThe Deputy’s question relates to the introduction of a new short-time work scheme for the manufacturing sector. The position is that policy responsibility for short-time work support, which is a form of Jobseeker’s Benefit, resides in the first instance with my colleague, the Minister for Social Protection.
The question makes reference to basing a new short-time work furlough scheme on the principles of the Employment Wage Subsidy Scheme (EWSS). However, it is important to point out that the EWSS was a unique scheme which was developed and operated in exceptional circumstances during the Covid-19 pandemic. Arising from this, the governance arrangements that applied to EWSS were also exceptional.
The Deputy may be interested to note that an inter-departmental senior official group is reviewing the experience from the introduction and operation of Covid-19 emergency income supports paid to/in respect of people whose employment was impacted due to public health restrictions, and to identify lessons learnt. I understand that the work of this group is at an advanced stage. My Department is represented on the relevant group which is chaired by the Department of Social Protection and also includes representatives from the Departments of Public Expenditure and Reform and Enterprise Trade and Employment and from the Office of the Revenue Commissioners.
Finally, the Pathways to Work 2021-2025 strategy, sponsored by Minister Humphreys and her Department, includes the following commitment: "building on the EWSS/TWSS and drawing on existing international models, explore the possibility of introducing a new Short Time Work Support scheme to enable employers retain people on their payroll in response to short-duration shocks to employment".
It is understood that the Labour Market Advisory Council, which provides external oversight of the strategy, is due to report to Minister Humphreys in the third quarter of this year on its views on the progress made in the first twelve months in implementing Pathways commitments.
385. Deputy Carol Nolan asked the Minister for Finance the expenses paid to ministerial advisers in his Department in each of the years 2020, 2021 and to date in 2022, in tabular form; and if he will make a statement on the matter. [43156/22]
Amharc ar fhreagraI wish to advise the Deputy that the expenses with respect to travel and subsistence for Ministerial advisors in my Department for the years 2020, 2021 and 2022 are outlined below, in tabular form. All expenses paid are in line with the relevant Department of Public Expenditure and Reform rates.
|
2020 |
€857.65 |
|
2021 |
€1,821.28 |
|
To date 2022 |
€11,450.07 |
386. Deputy Cathal Crowe asked the Minister for Finance if he will waive the taxation treatment that currently applies when portions of land are sold or leased to the ESB for the purposes of installing pylons in order to provide an incentive to farmers and landowners, owing to the requirement for Ireland to rapidly upgrade and enhance its national electricity grid infrastructure; and if he will make a statement on the matter. [43163/22]
Amharc ar fhreagraIn general, Capital Gains Tax (CGT) is chargeable on a gain arising on the disposal of an asset, including land sold for the purpose of installing pylons, at the rate of 33%. The first €1,270 of chargeable gains of an individual in any year are exempt from CGT.
I am informed by Revenue that the chargeable gain arising on the disposal of land is the difference between the sale price (net of certain incidental costs of sale) and the base cost, being the cost incurred when acquiring the land or, in certain circumstances, the market value of the land at the date of acquisition.
Should the land owner have incurred expenditure to enhance the land during their period of ownership, this cost may also be deducted in calculating the chargeable gain as long as it is reflected in the state or nature of the land at the time of disposal. Where only part of an asset, including land, is disposed of, only a portion of the base cost and, if relevant, enhancement expenditure is deductible in computing a chargeable gain on the part disposal.
The Deputy’s question relates specifically to the installation of pylons for the transmission of electricity. In this context, for the purposes of CGT, there is a disposal where any capital sum is received as consideration for the use or exploitation of assets, e.g. premiums for leases over land or lump sum payments to landowners or farmers for the granting of easements or wayleaves, whether in perpetuity or for a term of years.
Should the land in question be in use for the purpose of a trade, including farming, at the time of disposal, relief from CGT on gains arising on the disposal may be available by way of retirement relief (sections 598 and 599, Taxes Consolidation Act (TCA) 1997) and/or revised entrepreneur relief (section 597A TCA 1997), should the landowner fulfil the conditions required to claim such reliefs.
In relation to Income tax, section 664 TCA 1997 provides for a tax exemption in respect of income received by an individual from certain long-term leases of farmland. Relief under section 664 applies to lessors who enter leases of farmland with farmers. To qualify for relief, the leased farmland must be used by the lessee wholly or mainly for husbandry and for the purposes of farming.
A lease of land by an energy company for the purpose of the installation of pylons will not be regarded as related to the trade of farming for the purpose of section 664 TCA 1997. Therefore, the rental income received from an energy company is chargeable to tax under Case V of Schedule D, at the person’s marginal tax rate.
The facts and circumstances of each disponer at the time of each disposal will determine the CGT and / or income tax due when portions of land are sold or leased for the purpose of installing pylons.
387. Deputy Catherine Murphy asked the Minister for Finance the estimated additional yield that would be generated if the spirits retailers on-licence fee increased from €3,805 to €5,000 where the annual turnover is excess of €1.270 million, based on 2019 figures. [43187/22]
Amharc ar fhreagra388. Deputy Catherine Murphy asked the Minister for Finance the additional yield that would be generated if the spirits retailers on-licence fee increased from €2,535 to €2,900 where the annual turnover is above €952,500 but under €1.270 million, based on 2019 figures. [43188/22]
Amharc ar fhreagraI propose to take Questions Nos. 387 and 388 together.
I am informed by Revenue that, based on the 2019 licensing data, the estimated additional yield from increasing the spirits retailer’s on-licence fee from €2,535 to €2,900 where the annual turnover is between €952,500 and €1.270m, and from €3,805 to €5,000 where annual turnover exceed this value, would be €94,900 and €546,115 respectively.
389. Deputy Neale Richmond asked the Minister for Finance the steps that he is taking to address the fact that Irish mortgage rates remain the second highest in the eurozone; and if he will make a statement on the matter. [43268/22]
Amharc ar fhreagraI am aware that the general level of new lending interest rates in Ireland are higher than is the case in many other European countries. However, the price lenders charge for their loans is a commercial matter for individual lenders. As Minister for Finance I cannot determine the lending policies of individual banks including the interest rates they charge for loans including mortgages.
Despite this, it should also be noted that recent trends indicate that certain mortgage rates have been falling in Ireland. For example, the interest rates on new mortgages (excluding renegotiations) have fallen from 4.05% in December 2014 to 2.68% in June 2022. (The average for the euro area in June 2022 rose to 1.90%, although rates varied considerably across countries).
The weighted average interest rate on new fixed rate mortgage agreements stood at 2.52% in June 2022, down from 4.11% in December 2014. It is also worth noting that a significant portion of new mortgages – 88% in June 2022 - are now fixed rate mortgages and this will protect borrowers in the event of a rise in official and market interest rates at least for the period that the interest rate is fixed. There has also been a reduction in the interest rates charged on loans to SMEs and consumers over the same period.
Irish mortgage and other loans can have different characteristics from those offered in other countries. For example, many Irish banks include incentives such as cash back offers, which reduce the effective Irish mortgage interest rate. Also Irish mortgages are generally not subject to upfront fees which are typically charged by banks in some other EU jurisdictions.
To support consumers when considering what mortgage option is best for them, the Central Bank introduced a number of increased protections for variable rate mortgage holders in 2017. The enhanced measures, which are provided for in an Addendum to the Consumer Protection Code 2012, require lenders to explain to borrowers how their variable interest rates have been set, including in the event of an increase. The measures also improve the level of information required to be provided to borrowers on variable rates about other mortgage products which could provide savings for the borrower and signpost the borrower to the Competition and Consumer Protection Commission's (CCPC) mortgage switching tool.
The Central Bank also introduced additional changes to the Consumer Protection Code in 2019 to help consumers make savings on their mortgage repayments, provide additional protections to consumers who are eligible to switch, and facilitate mortgage switching through enhancing the transparency of the mortgage framework.
Consumers can reduce average pricing in the mortgage market by availing of switching options. In this regard, a 2020 Central Bank study estimated that three in every five ‘eligible’ mortgages for principal dwelling homes stand to save over €1,000 within the first year if they switch and €10,000 over the remaining term.
To conclude I appreciate that greater sustainable competition in the credit market will be of benefit to consumers and other borrowers. Accordingly, the review of the retail banking market which is now underway in my Department will consider how the banking system can best support economic activity, assess competition and consumer choice in the market for banking services and consider options to further develop the mortgage market.
390. Deputy Peadar Tóibín asked the Minister for Finance the measures he is putting in place for single PAYE workers without dependants to alleviate the increased cost-of-living challenges for this cohort; and if he will make a statement on the matter. [43298/22]
Amharc ar fhreagraWith regard to the cost of living increases, the Government is acutely aware of the cost pressures currently facing businesses and households, including people aged 65 years or over and those workers in the category to which the Deputy refers, and has responded to help alleviate some of this burden. On a cumulative basis, the Government has announced approximately €2.4 billion in cost of living measures since last October. These measures include changes in tax and social welfare, the provision of an energy credit for households and a temporary reduction in the rate of VAT on the supply of certain energy products.
While public resources cannot be deployed at the scale that would be needed to fully compensate for cost increases, the Government remains fully committed to supporting and protecting those most vulnerable in society through both tax and expenditure measures. Further measures are actively being considered in the context of Budget 2023.
As the Deputy will appreciate, it is a longstanding practice of the Minister for Finance not to comment in advance of the Budget on any tax matters that might be the subject of Budget decisions.
391. Deputy Sean Sherlock asked the Minister for Finance if he will provide an update on the collection of data on vacancy levels with a view to introducing a new vacant property tax to ensure that empty properties are used under Housing for All. [43333/22]
Amharc ar fhreagraAddressing vacancy and dereliction, and maximising the use of existing housing stock, is a priority objective of the Government. Housing for All outlines a suite of measures aimed at addressing vacancy in a coordinated, robust manner, and specifically includes an action for the Department of Finance to collect data on vacancy with a view to introducing a vacant property tax.
Provisions included in the Finance (Local Property Tax) (Amendment) Act 2021 enabled Revenue to collect certain information on vacant properties in the Local Property Tax return forms submitted by residential property owners in respect of the new LPT valuation period 2022-2025. This information included whether the properties were unoccupied at 1 November 2021, the reason why and whether they (the properties) had been vacant for 12 months or more. Vacancy data on LPT returns has not been verified by Revenue and was collected for informational purposes only. A preliminary analysis of this data was published by Revenue on 6 July 2022, and is available at:
www.revenue.ie/en/corporate/information-about-revenue/statistics/local-property-tax/lpt-stats-2022/index.aspx.
The preliminary analysis published by Revenue includes a breakdown of the various reasons provided for vacancy. It indicates that the most frequent reasons for properties reported as vacant, were “Undergoing Refurbishment” (22.2%), “Other” (21.7%) and “Holiday Home” (20.4%). Other reasons for vacancy were reported as a property being for sale or between lettings, subject to a probate application or other legal proceedings, or where the owner is in long-term care. The analysis also indicated that levels of vacancy among LPT liable properties are low across all counties and lie within a range that is considered to be in line with a normal functioning housing market.
As I have said on many occasions, I consider that the primary objective of a vacant residential property tax would be to increase the supply of homes for rent or purchase to meet demand rather than increasing tax revenues. The Revenue analysis provides a basis for my Department to assess the merits and impact of introducing a Vacant Property Tax, and how best such a tax might be designed. This work has already commenced and I intend to bring forward proposals on a targeted measure that achieves an appropriate balance between incentivising owners of vacant habitable residential properties to bring their properties back into use, and ensuring any such tax does not arbitrarily or excessively penalise home-owners for normal temporary vacancy.
392. Deputy Sean Sherlock asked the Minister for Finance the engagement he has had with the Minister for Education on the matter of school transport since June 2022; and if he will publish any correspondence shared with the Minister for Education on same. [43355/22]
Amharc ar fhreagraI can confirm that there has been no correspondence between me and the Minister for Education on the matter of school transport during the time period referred to.
