Written Answers Nos. 310-329
310. Deputy Paul Murphy asked the Minister for Finance how he will ensure that all tenants are able to avail of the tax credit given that they are not responsible for landlords registering with the RTB (details supplied); if he will make certain that there are no negative impacts to tenants; and if he will make a statement on the matter. [47750/23]
Amharc ar fhreagraFinance Act 2022 introduced the Rent Tax Credit, which is provided for in section 473B of the Taxes Consolidation Act 1997. This is an income tax credit of up to €500 per year (or up to €1,000 for jointly assessed couples) which may be claimed in respect of qualifying rent paid in 2022 and 2023. Budget 2024 increased this credit to €750 per year (or up to €1,500 for jointly assessed couples) for years 2024 and 2025. Qualifying payments must be made under a tenancy.
A tenancy for this purpose is a rental arrangement which falls into one of the below categories:1. An agreement, contract or lease which is required to be registered with the Residential Tenancy Board (RTB) under Part 7 of the Residential Tenancies Act 2004. Where a rental arrangement is of a type which is required to be registered with the RTB, the landlord must have complied with this registration obligation in order for the claimant to receive the Rent Tax Credit.
2. A licence for the use of a room, or rooms, in an individual's person’s principal private residence. Such rental arrangements are not generally required to be registered with the RTB under Part 7 of the Residential Tenancies Act 2004, and therefore availability of the Rent Tax Credit in such circumstances is not dependent on the tenancy being registered.Consistent with category 2 above, a person renting under a tenancy which is not required to be registered with the RTB is not required to provide an RTB registration number when claiming the Rent Tax Credit.Full details of the type of tenancies which must be registered with the RTB, and the process by which such registrations may be completed, can be found on the RTB website available at: www.rtb.ie
Responsibility for compliance with the legal obligation to register a tenancy under the Residential Tenancies Act 2004 is a matter for the RTB, and landlords should familiarise themselves with their RTB registration obligations and ensure that they have fulfilled same. Where a tenancy is registered with the RTB, claimants are requested to provide the RTB number as part of the claim process.
Compliance with the legal obligation to register a tenancy under the Residential Tenancies Act 2004 (as amended) is a matter for the RTB. Unregistered tenancies may be reported to the RTB’s Registration Enforcement Unit by email to enforcement@rtb.ie.
In relation to the statement provided “less than half of tenants have claimed Rent Tax Credit” I am advised by Revenue that the Rent Tax Credit statistics currently available refer only to claims by PAYE taxpayers for the 2022 tax year and the 2023 tax year to-date. Data on claims by self-assessed taxpayers is not yet available as these taxpayers’ returns are generally submitted later in the year. The statutory filing date for the 2022 tax return for self-assessed taxpayers is 31 October 2023.
Claims in respect of the 2022 year of assessment can be made by PAYE taxpayers by submitting an Income Tax return for that year. For claims relating to 2023, PAYE taxpayers have the option of claiming the rent tax credit due to them either as rent is incurred or at the end of the year through their Income Tax return. I also would note that tax refunds can be requested within four years after the end of the tax year to which the claim relates, so it is possible that eligible persons may not claim the Rent Tax Credit in respect of 2022 until 2026.
During the Budget 2023 process, it was estimated that approximately 400,000 individual persons are eligible to claim the Rent Tax Credit for 2022. The same figure was estimated for 2023, 400,000 individuals eligible to claim.
Rent Tax Credit claims made are on a ‘taxpayer unit’ basis. A taxpayer unit is either an individual with any personal status who is singly assessed or a couple in a marriage or civil partnership who have elected for joint assessment. By this metric we would not expect to see 400,000 taxpayer units claim the credit.
Revenue is conducting an information campaign to highlight the ease of use of the online myAccount system and to raise awareness of a range of key tax credits and reliefs available to taxpayers including the rent tax credit.
I am further advised that as of 22 October 2023, 300,958 Rent Tax Credit claims have been made by 261,347 taxpayer units consisting of:
(i) 202,873 taxpayer units that made claims for 2022 only,
(ii) 39,611 taxpayer units that made claims for both 2022 and 2023,
(iii) 18,863 taxpayer units that made claims for 2023 only,
The operation of the Rent Tax Credit will continue to be closely monitored by my Department in conjunction with Revenue.
311. Deputy Louise O'Reilly asked the Minister for Finance if he will provide a breakdown of tax liabilities warehoused by companies in the NGO sector under the debt warehousing scheme, and for these NGOs to be subdivided into the sector they are operating in; and for this information to be provided in tabular form. [47754/23]
Amharc ar fhreagra312. Deputy Louise O'Reilly asked the Minister for Finance if he will provide a breakdown of tax liabilities warehoused by sporting organisations and clubs under the debt warehousing scheme, and for these sporting organisations and clubs to be subdivided by sport; and for this information to be provided in tabular form. [47755/23]
Amharc ar fhreagra313. Deputy Louise O'Reilly asked the Minister for Finance the volume of tax liabilities warehoused under the debt warehousing scheme that Revenue has determined uncollectible for any reason, including liquidation, examinership, cessation of trading, bankruptcy or other, in tabular form; to provide a breakdown of the amount of tax lost per division and per sector; and if he will make a statement on the matter. [47756/23]
Amharc ar fhreagra314. Deputy Louise O'Reilly asked the Minister for Finance the number of customers who had their warehouse status under the debt warehousing scheme revoked due to persistent non-compliance issues; the volume of debt concerned and being pursued by Revenue; and if he will make a statement on the matter. [47757/23]
Amharc ar fhreagraI propose to take Questions Nos. 311 to 314, inclusive, together.
The Tax Debt Warehousing scheme has offered valuable and practical liquidity support to businesses during the COVID pandemic and continues to support businesses as they recover from the impacts of the pandemic and increased energy prices. It has assisted businesses with their cash-flow during difficult trading periods, preventing business failure. The objective of this scheme is to allow firms help to recover thereby helping to guarantee their long-term economic viability and survival.
The scheme applied to VAT debts, PAYE (Employer) debts, certain self-assessed income tax debts and overpayments of both the Temporary Wage Subsidy Scheme (TWSS) and the Employment Wage Subsidy Scheme (EWSS).
The scheme allowed for the parking of the debt at 0 per cent interest up to 31 December 2022 (or 30 April 2023 for those in the extended scheme). A significantly reduced interest rate of 3 per cent, as opposed to the general interest rate of 10 per cent (or 8 per cent for income tax underpayments), applies from 1 January 2023 on the warehoused debt (or from 1 May 2023 for those in the extended scheme).
The scheme was automatically available to businesses and individuals that are managed by Revenue’s Business and Personal Divisions. Revenue’s Business Division manages enterprises with an annual turnover less than €3 million, which accounts for the majority of business taxpayers. Revenue’s Personal Division deals with all business entities with no trade or professional income such as trusts, charities, including NGOs, and sporting bodies. The scheme was also available on application to larger businesses managed by Revenue’s Large Corporates and Medium Enterprises Divisions, where such businesses were adversely impacted by the pandemic, and included a small number of individuals in Revenue’s High Wealth Division.
I am advised that Revenue does not record data by the category of NGO. In order to extract data which is as close as possible to the NGO sector, all cases with the Approved Charitable Body designation have been set out below in tabular form, along with the business activity sector in which they operate.
Breakdown by sector of tax liabilities warehoused by approved charitable bodies under the debt warehousing scheme:
|
Sector |
Amount |
|
Q Human health and Social Work activities |
€3,782,166.36 |
|
S Other services activities |
€1,327,445.21 |
|
R Arts, entertainment and recreation |
€1,020,796.23 |
|
O Public administration and defence; compulsory social security |
€840,814.17 |
|
G Wholesale and retail trade; Repair of motor vehicles and motorcycles |
€518,570.44 |
|
P Education |
€364,593.21 |
|
I Accommodation and food service activities |
€240,729.07 |
|
N Administrative and support service activities |
€179,041.01 |
|
L Real estate activities |
€127,772.72 |
|
All other Sectors/Unknown |
€61,748.20 |
|
Total |
€8,463,676.62 |
A breakdown of tax liabilities warehoused by approved sporting bodies under the debt warehousing scheme is set out in the following table. (A breakdown by sport is not available).
|
Tax head |
Amount |
|
PAYE (Employers) |
€724,585.28 |
|
Overpayments arising from the Employment Wage Subsidy Scheme |
€169,675.21 |
|
Overpayments arising from the Temporary Wage Subsidy Scheme |
€161,473.98 |
|
VAT |
€80,424.52 |
|
Total |
€1,136,158.99 |
The significant extension to the scheme announced in October 2022 means that businesses have until 1 May 2024 to make arrangements to repay their warehoused debt. Importantly, businesses are still able to avail of the reduced 3 per cent interest rate from 1 January 2023 when they come to pay the debt.
The total warehoused debt that has become uncollectible for any reason, including liquidation, examinership, cessation of trading, bankruptcy etc, is set out in the following tables by Division and by Sector:
|
Division |
Amount |
|
Business |
€57,263,216.64 |
|
Medium Enterprises |
€24,297,955.19 |
|
Large Corporates |
€6,780,400.99 |
|
Personal |
€147,637.32 |
|
Grand Total |
€88,489,210.14 |
|
Sector |
Amount |
|
G Wholesale and retail trade; Repair of motor vehicles and motorcycles |
€28,829,293.61 |
|
F Construction |
€15,189,978.30 |
|
C Manufacturing |
€8,672,420.14 |
|
J Information and Communication |
€8,287,826.30 |
|
I Accommodation and food service activities |
€7,221,843.26 |
|
H Transportation and Storage |
€6,137,544.12 |
|
M Professional, scientific and technical activities |
€3,836,745.85 |
|
N Administrative and support service activities |
€3,455,224.68 |
|
L Real estate activities |
€1,248,112.58 |
|
S Other services activities |
€1,225,043.89 |
|
K Financial and Insurance Activities |
€1,175,849.17 |
|
E Water supply; Sewerage, Waste management and remediation activities |
€815,464.11 |
|
P Education |
€766,419.32 |
|
R Arts, entertainment and recreation |
€751,908.06 |
|
Q Human health and Social Work activities |
€603,851.03 |
|
O Public administration and defence; compulsory social security |
€122,064.10 |
|
A Agriculture, forestry and fishing |
€116,548.73 |
|
All other Sectors/Unknown |
€33,072.89 |
|
Grand Total |
€88,489,210.14 |
Businesses are reminded on an ongoing basis that it remains a key condition of the Tax Debt Warehousing scheme that current liabilities are filed and paid on time. Revenue is actively engaging with businesses in the scheme to ensure they are complying with this key condition in order to retain the benefits of the scheme. However, where there is a continued lack of engagement and persistent non-compliance with current tax obligations, businesses will lose the benefit of the debt warehouse scheme.
At the end of September 2023, there were 11,816 businesses/individuals with warehoused debts totalling €312 million that had their warehouse status revoked due to persistent non-compliance with the scheme conditions. Where a business addresses their non-compliance issues and brings their current taxes up to date, the business can have its warehouse status reinstated.
Where payment difficulties arise, particularly in relation to current tax obligations, I am assured that Revenue will work proactively with businesses who engage early to resolve these payment difficulties.
315. Deputy Matt Carthy asked the Minister for Finance the engagements his Department, or any agency or body under his direction, has had with the Government of Israel, any state body of the Government of Israel, or any engagement within or with Israel, in 2021, 2022 and to date in 2023; and if he will make a statement on the matter. [47806/23]
Amharc ar fhreagra316. Deputy Matt Carthy asked the Minister for Finance the engagements his Department, or any agency or body under his direction, has had with the Palestinian Authority, any organ of the Palestinian Authority, or any engagement within, or with organisations in, the occupied Palestinian territory, in the years 2021, 2022 and to date in 2023; and if he will make a statement on the matter. [47824/23]
Amharc ar fhreagraI propose to take Questions Nos. 315 and 316 together.
On 17th May 2023, officials from my Department met Rahav Shalom Revivo, Head of Financial-Cyber Innovation and International Engagement at the Israeli Ministry of Finance to discuss cyber security in the financial sector. The regulatory landscape for financial services in Israel and Ireland was discussed and Ms Shalom Revivo provided an overview of her work on the development crisis management frameworks to mitigate the impact of cyber-attacks.
On 18th May 2023, Minister of State Jennifer Carroll MacNeill and Department of Finance officials met Ms Shalom-Revivo at Dublin Castle. Ms. Shalom-Revivo was a speaker on the Fraud, Error and Debt Panel at the Global Government Fintech Lab at Dublin Castle on 18 May. Topics discussed at the meeting included the work of the Israeli Ministry of Finance in the area of cybersecurity, the cyber threats to the financial services sector and ensuring women are encouraged to take up senior positions in the sector.
The bodies under the aegis of my Department have advised as follows:
Since 2021, the Ireland Strategic Investment Fund (ISIF), which is a part of the National Treasury Management Agency (NTMA), has had only one direct engagement in Israel and that was in May 2021 with the Israeli Innovation Authority by email. As part of ISIF’s Sustainability and Responsible Investment (SRI) Strategy, ISIF pursues Active Ownership through its engagement manager, EOS at Federated Hermes, who would engage with a variety of companies both within the Occupied Palestinian Territory and Israel.
For completeness, NTMA staff in other areas, such as New ERA and Funding and Debt Management, will have been in attendance at Organisation for Economic Co-operation and Development (OECD) Working Parties and at other fora where Israeli delegates would also have been in attendance.
ISIF has had no direct engagement with the Palestinian Authority, any organ of the Palestinian Authority, or any engagement within, or with organisations in, the Occupied Palestinian Territory, in the years 2021, 2022 and to-date in 2023.
The Office of the Comptroller and Auditor General (OCAG) did not have bi-lateral engagement with the government of Israel, any state body of the government of Israel, or any engagement within or with Israel in the years 2021, 2022 and to-date in 2023. However, OCAG is a member of the International Organisation of Supreme Audit Institutions (INTOSAI) and the European Organisation of Supreme Audit Institutions (EUROSAI), which are autonomous, independent and non-political organisations. Israel is also a member of both organisations. As a member of both organisations, representatives of OCAG attended/presented at number of conferences/webinars.
OCAG has had no engagement with the Palestinian Authority, any organ of the Palestinian Authority, or any engagement within, or with organisations in, the Occupied Palestinian Territory, in the years 2021, 2022 and to-date in 2023.
The International Tax Division of the Revenue Commissioners has regular engagement with the tax administrations and Ministries of Finance of other jurisdictions, including Israel, in the performance of its functions. Details of engagements during the period 2021, 2022 and to date in 2023 are as follows:
• Ireland and Israel are among 101 jurisdictions that are signatories and parties to the OECD Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (“MLI”). The effect of the MLI is to modify the application of signatories covered tax treaties to implement the MLI’s agreed minimum standards and best practices. Signatories can develop, in consultation with their treaty partner, synthesised texts to help to ensure a consistent interpretation of the application of the MLI’s provisions to each covered tax treaty. Revenue follows this good administrative practice. In that regard, Revenue and the Israeli Ministry of Finance have had email exchanges for the purposes of developing a synthesised text for the application of the Double Taxation Treaty between Ireland and Israel as modified by the MLI.
• The International Cooperation unit assisted a tax official from the Israel Tax Authority with two requests regarding our general taxation system.
• Ireland and Israel are part of the 147 jurisdictions that participate in the Convention on Mutual Administrative Assistance in Tax Matters to allow for exchange of information on tax matters and are signatories of the Multilateral Competent Authority Agreements to allow for automatic exchange of information under the Common Reporting Standard and Country by Country Reporting. The exchanges themselves, including whether or not an exchange took place, are confidential.
• In addition, it should be noted that both Ireland and Israel are members of the OECD and participate in forums, bodies and working parties facilitated by the OECD’s Centre for Tax Policy and Administration. Such forums and bodies include the Forum on Tax Administration and its network the Joint International Taskforce on Shared Intelligence and Collaboration (JITSIC), the Global Forum on Transparency and Exchange of Information for Tax Purposes and the Forum on Harmful Tax Practices. Working parties include those focusing on international taxation issues such as tax conventions, tax policy analysis and tax statistics, consumption taxes, Exchange of Information and tax compliance and aggressive tax planning.
The Office of the Revenue Commissioners has had no engagement with the Palestinian Authority, any organ of the Palestinian Authority, or any engagement within, or with organisations in, the Occupied Palestinian Territory, in the years 2021, 2022 and to-date in 2023.
The Central Bank of Ireland (CBI) engages with a large number of other central banks internationally, both directly and through its involvement in international organisations. The following are the engagements with Israel since 2021:
• On February 8th 2021, the Governor of the CBI received a letter from the former Ambassador of Israel in Ireland, with regard to Israel’s request to join the Asian Development Bank (ADB). The Governor responded via letter on February 17th 2021, advising that the Minister for Finance was Ireland’s representative and Governor at the ADB, and that the Ambassador’s letter had been forwarded to the Department of Finance.
• On May 27th 2021, officials from CBI virtually met with officials of the Bank of Israel. The meeting was requested by the Bank of Israel, and was to discuss the CBI’s Innovation Hub, including the purpose and mission of the Innovation Hub and how it is structured, managed and operated. After the meeting, the CBI followed up via email with responses to questions from the Bank of Israel.
• Officials from the Bank of Israel attended an International Operational Risk Working Group virtual event in May 2021, which was hosted by the CBI. This is an international group, covering around 100 central banks and monetary authorities, in which both the CBI and Bank of Israel are members.
• On January 10th 2023, CBI officials met virtually with officials from the Bank of Israel to discuss organisational risk related issues. The meeting was requested by the Bank of Israel.
• On January 27th 2023, Sharon Donnery (Deputy Governor, Financial Regulation) attended a Holocaust memorial event in the European Central Bank alongside Israeli dignitaries and other international representatives.
• Following an introduction from the Department of Environment, Climate and Communications, the Israeli Embassy arranged a visit to the CBI for the Head of Financial-Cyber Innovation and International Engagement in the Israel Ministry of Finance to exchange views on financial cyber issues. The visit took place on May 17th 2023. There has been no follow up engagement since the meeting.
• In June 2023, staff from the Central Credit Register (which is established by the CBI under the Credit Reporting Act 2013), met some Bank of Israel staff informally at the 2023 ACCIS Annual Conference, which many different organisations attend. Consequent to this, the CBI responded briefly via e-mail to some technical questions concerning how it manages SME credit within the Irish Central Credit Register and associated matters. There has been a recent approach regarding a potential future meeting, but nothing has been agreed in that regard.
In addition, over the course of the period specified, CBI officials have responded by email to information requests from the Bank of Israel, including on topics such as corporate governance, administrative budgeting, and risk management.
Throughout this period, Israeli delegates will have attended various international fora which the Central Bank is involved in (i.e. the Bank for International Settlements, the IMF Spring/Annual Meetings, etc.).
The following are the engagements by the CBI with the Palestinian Monetary Authority since 2021:
• In May 2021, officials from the Palestinian Monetary Authority (PMA) attended an International Operational Risk Working Group virtual event, which was hosted by the CBI. This is an international group, covering around 100 central banks and monetary authorities, in which both the CBI and Palestinian Monetary Authority are members.
• In March 2023, the CBI hosted a study visit from the PMA. The visit was organised and funded by the European Commission, European Neighbourhood Policy and Enlargement Negotiations as part of its Technical Assistance and Information Exchange Instrument (TAIEX) programme, which supports the public administrations of partner countries with regard to the approximation, application and enforcement of EU legislation as well as facilitating the sharing of EU best practices. The purpose of the visit was to provide an overview on the CBI’s approach to resolution and crisis management.
Throughout the period referred to, Palestinian delegates may have attended various international fora which the Central Bank was also involved in.
318. Deputy Louise O'Reilly asked the Minister for Finance if, given that it has been stated that Irish contract law allows for a shop or other business to place a sign saying, for example, 'card only' (details supplied), and that the act of displaying this sign constitutes a contract binding on the customer, he will outline the grounds of "Irish contract law", specifically, legislation and articles, on which his interpretation is based. [47853/23]
Amharc ar fhreagraAs the Deputy will be aware, where a business places no restrictions on the means of payment it is prepared to accept, it must accept cash as legal tender when offered by a customer to settle a debt that has arisen. If a business specifies payment must be in a form other than cash, the customer cannot subsequently claim a legal right to pay in cash. This can be achieved by, for example, placing a sign stating, “cash not accepted” or “card payment only” at the store entrance or check out area.
As a matter of common law, contracts are formed by offer and acceptance. In general terms, a contract is formed between a retailer and a customer when a retailer accepts an offer made by a customer. The terms which apply to such a contract are a matter for the parties to determine and will depend on the circumstances of the case. The Consumer Rights Act 2022, which was sponsored by the Minister for Enterprise Trade & Employment, applies to contracts entered into between retailers and consumers on or after 29 November 2022.
The Deputy should also be aware that one of the recommendations of the Retail Banking Review was that the Department of Finance should lead on the preparation of a new National Payments Strategy to be completed in 2024.
The National Payments Strategy will set out a roadmap for the future evolution of the entire payments system, taking account of developments in digital payments, the use of cheques and other issues, and guide how future changes should be made to the entire payments system. The Strategy should also be informed by, and aligned with, the retail payment strategies of both the EU Commission and the Eurosystem.
319. Deputy Ged Nash asked the Minister for Finance for an update on the implementation of the recommendations of the banking review; if has considered the merits of establishing a review group to oversee the project; and if he will make a statement on the matter. [47856/23]
Amharc ar fhreagraThe Government approved the publication of the Retail Banking Review and the implementation of its recommendations on 29 November 2022. Each recommendation identifies the body or bodies responsible for delivery of that recommendation and in some cases contain timelines for delivery of the recommendation, where appropriate. It is for the relevant bodies to consider and implement the recommendations addressed to them.
Implementation of many of the recommendations requires close collaboration between my Department and the Central Bank. The implementation of the recommendations that are directed at the Department of Finance have been embedded in the business plans of the relevant areas.
A key issue identified by the Review was access to banking services, particularly the ability to withdraw and deposit cash, and a number of recommendations address this. There is a dedicated team in place working on this issue that is currently developing legislation and preparing heads of bill to be ready by the end of the year.
These heads of bill will include requiring the larger retail banks to provide reasonable access to cash, based on existing levels of access. This work involves significant consultation with the Central Bank and other stakeholders.
The Central Bank has informed me that it is also working on the implementation of recommendations addressed to it. The Bank is currently undertaking a major review of the Consumer Protection Code and the outcome of this significant piece of work is likely to address several of the recommendations of the Review.
Other recommendations require implementation by other State agencies, such as the Competition and Consumer Protection Commission (CCPC), Government departments and other relevant stakeholders.
It is also crucial that the retail-banking sector ensures the interest of consumers are a priority in their organisations and seek to work together, where possible, to deliver the best outcomes for the economy and citizens. The retail-banking sector has been contacted regarding their role in carrying out those recommendations which fall to them.
320. Deputy Carol Nolan asked the Minister for Finance to clarify what protections are in place for persons who feel they are not being treated fairly by so-called 'vulture funds' (details supplied); and if he will make a statement on the matter. [47865/23]
Amharc ar fhreagraThe Deputy will be aware that I cannot comment on individual cases or particular arrangements that may be agreed between a borrower and a regulated entity in order to address a specific repayment difficulty.
There is a robust consumer protection framework in place in Ireland. This framework provides the same protections for borrowers, regardless of the regulated entity with whom they are dealing, be that a bank, retail credit firm (RCF) or credit servicing firm (CSF). These regulated entities must be authorised and supervised by the Central Bank of Ireland, and are subject to the full suite of relevant regulatory requirements and financial services legislation, including the Code of Conduct on Mortgage Arrears (CCMA).
I would draw the Deputy's attention to paragraph 44 of the CCMA which states that a lender must carry out a review of an alternative repayment arrangement at any time, if requested by the borrower.
The CCMA has been designed to protect consumers and regulated lenders are legally obliged to comply with it. I would encourage any individual experiencing difficulty with their repayment arrangements to first contact their provider directly and use the official complaints procedure. If they are unhappy with the response and efforts to improve the service they are receiving, they have the option to make a complaint to the Financial Services and Pensions Ombudsman. Information on the complaints procedure is available on the FSPO website.
321. Deputy Cian O'Callaghan asked the Minister for Finance if he will provide a scenario analysis post-budget 2024 for a person who is a first-time buyer, single and earning €35,000 per year, and how budget 2024 affects them in housing terms; and if he will make a statement on the matter. [47919/23]
Amharc ar fhreagraFor a person who is a first-time buyer, single and earning €35,000 per year, the following changes made in Budget 2024 may be of relevance:
The Help to Buy (HTB) incentive is a scheme to assist first-time purchasers with the deposit they need to buy or build a new house or apartment. The incentive gives a refund on Income Tax and Deposit Interest Retention Tax paid in the State over the previous four years, subject to limits outlined in the legislation.
Budget 2024 extended the Help to Buy scheme for an additional year to the end of 2025, to give certainty to prospective home buyers and to the market.
Also in Budget 2024 the scheme was amended to enhance its interaction with the Local Authority Affordable Purchase Scheme (LAAP). This amendment will enable the use of the affordable dwelling contribution received through the LAAP scheme for the purposes of calculating the 70 per cent loan-to-value requirement, thereby facilitating access to a greater number of LAAP purchasers to the HTB scheme.
The Rent Tax Credit introduced last year, provides support to certain taxpayers in tenancies registered with the Residential Tenancies Board and certain rent a room arrangements. Budget 2024 increases the amount that can be claimed from €500 to €750, or from €1,000 to €1,500 for a jointly assessed couple. This increase will take effect from 1 January 2025.
322. Deputy Claire Kerrane asked the Minister for Finance if consideration has been given to adjusting the flat-rate VAT scheme for farmers (details supplied); if he has engaged with the Minister for Agriculture, Food and the Marine on the scheme; and if he will make a statement on the matter. [47999/23]
Amharc ar fhreagraI am advised by Revenue that the VAT registration thresholds are subject to the requirements of EU VAT law, with which Irish VAT law must comply. Ireland’s threshold for a business supplying services is €37,500 and our threshold for a business supplying goods is €75,000. Businesses whose annual turnover is below these levels are not obliged to register for VAT, although they may opt to do so.
Currently, EU VAT law provides that registration thresholds may only be raised by Member States to maintain their value in real terms, that is, they may not be increased above inflation. Ireland’s VAT thresholds were increased to their current values on 1 May 2008. As part of Budget 2024, I announced that the VAT registration thresholds for goods would rise to €40,000 and €80,000 for services and goods respectively. The new thresholds will apply from 1 January 2024.
It is not possible to raise the VAT threshold to €250,000.
323. Deputy Réada Cronin asked the Minister for Finance if his Department engages a company (details supplied); if so, the duration and nature of the work; the cost of same to the Exchequer; and if he will make a statement on the matter. [48011/23]
Amharc ar fhreagraThe Department of Finance has not engaged the named company.
324. Deputy Michael Healy-Rae asked the Minister for Finance the reason VAT cannot be claimed back on calf feeders under the TAMS grant (details supplied); and if he will make a statement on the matter. [48089/23]
Amharc ar fhreagraAs the Deputy will be aware, the VAT treatment of goods and services is subject to EU VAT law, with which Irish VAT law must comply. In accordance with the EU VAT Directive farmers can elect whether or not to register for VAT in respect of their farming business.
Farmers who register for VAT have an entitlement to reclaim VAT on costs incurred in relation to the agricultural business. A farmer who has elected to register for VAT and charges VAT on their supplies can claim a deduction for VAT incurred on costs that are used for the purposes of their taxable supplies. A VAT registered farmer would be entitled to reclaim VAT incurred on automatic calf feeders through their VAT returns. Alternatively, farmers can remain unregistered and opt for the Flat Rate Farmer’s Scheme.
The Scheme is designed to reduce the administrative burden for farmers and allows them to remain outside the normal VAT system thereby avoiding the obligations of registration and returns. Unregistered farmers may avail of a VAT refund on certain expenses allowed for under the Value-Added Tax (Refund of Tax) (Flat-rate Farmers) Order 2012 (S.I. No. 201/2012). The VAT refund order allows for refunds to be claimed on outlay incurred on the construction, extension, alteration or reconstruction of a farm building or structure, on fencing, draining and reclamation of farmland, and the construction of qualifying equipment for the purpose of micro-generation of electricity for use in a farm business. The refund order does not provide for relief from VAT suffered on the acquisition of moveable goods such as farm machinery. As such, outlay incurred on the installation of certain feed systems has been allowed in certain circumstances where their installation is considered an alteration or reconstruction of a farm building or structure. However, Revenue consider that automatic calf feeders constitute movable goods and are therefore not provided for under the order.
Revenue is aware that there are numerous types of feed systems and that certain feed systems have changed or evolved to an extent that they do not require reconstruction of a building to install. Instead, they may be removed without causing significant damage. I am advised that Revenue has not changed their approach to the refund order, instead each product is assessed on its own merits. Products that do not meet the conditions of the refund order cannot qualify for a refund of the VAT.
325. Deputy Éamon Ó Cuív asked the Minister for Finance the annual contribution to the EU by the Exchequer in each of the past ten years, including an estimate of the contribution forecast for the whole of 2023; the income from the EU to the Exchequer in each of these years, including an estimate for this year; whether it is expected that Ireland's net contribution to the EU will increase in the coming ten years; and if he will make a statement on the matter. [48304/23]
Amharc ar fhreagraThe annual net contribution of Ireland to the EU Budget (payments) and income (receipts), from 2013 until 2021 is outlined in full in Table 1 below.
Table 2 outlines Ireland’s actual gross contribution (payment) for 2022 together with current forecasts for the gross contribution (payment) for the remaining years until the end of the current Multiannual Financial Framework period which ends in 2027.
Data on Ireland’s EU Budget receipts is published annually for the previous year in the Department of Finance Budgetary Statistics, before the end of each year.
For instance, 2022 receipt data will be published before the end of 2023. My Department is currently finalising the collation of the receipts data for 2022 and, it is not yet possible to confirm Ireland’s receipts from the EU Budget for 2022, but this information will be published by my Department before the end of the year.
My Department does not forecast EU Budget receipts due to the inherent difficulties in doing so, as receipts are contingent on a number of factors such as project implementation. That said, my Department anticipates that Ireland’s receipts for the remainder of the Multiannual Financial Framework (2021-2027) will be in the range of approximately €2 - 2.5 billion each year.
Table 1. EU Budget receipts and payments 2013-2021
|
Year |
Receipts from EU Budget €m |
Payments to EU Budget €m |
Net Receipts €m |
|
2013 |
1673 |
1726 |
-53 |
|
2014 |
1420 |
1686 |
-266 |
|
2015 |
1783 |
1952 |
-169 |
|
2016 |
1622 |
2023 |
-401 |
|
2017 |
1779 |
2016 |
-237 |
|
2018 |
2006 |
2519 |
-513 |
|
2019 |
2000 |
2432 |
-432 |
|
2020 |
2116 |
2569 |
-453 |
|
2021 |
2543 |
3507 |
-964 |
Table 2. EU Budget contributions - actual payment 2022 and payment forecasts 2023-2027
|
2022 (€m) |
2023 (€m) |
2024 (€m) |
2025 (€m) |
2026 (€m) |
2027 (€m) |
|
3557 |
3950 |
3950 |
4125 |
4325 |
4500 |
Based on my Department’s forecasts, Ireland’s contribution to the EU Budget will continue to grow over the remainder of the Multiannual Financial Framework (2021-2027). This is dependent on a number of factors, in particular Ireland’s economic performance which is reflected in the system of EU Budget contributions based to a considerable extent on the existing Gross National Income own resource.
In addition, a potential midterm revision of the Multiannual Financial Framework (2021-2027), which is currently under negotiation at EU level, would likely result in increased expenditure over the remainder of the of the current Multiannual Financial Framework and could impact on Member States' EU contributions.
Beyond 2028, agreement on the composition of the next Multiannual Financial Framework will be key to determining Member States' contributions over the next long term EU Budget cycle, which should cover a period of 5 or 6 years if following longstanding practice.
Potential future changes to the system of own resources, which fund the EU Budget, could also affect Member States' EU Budget contributions if agreed. The European Commission brought forward proposals in relation to new own resources in June and I recently set out my concerns on a proposed new own resource based on a statistical measure of Corporate Profits. On this, I would refer the Deputy to my response to a Parliamentary Question from Deputy Doherty (PQ 43392/23).
326. Deputy Thomas Pringle asked the Minister for Finance the number and details of contracts currently held by his Department with a company (details supplied); and if he will make a statement on the matter. [48309/23]
Amharc ar fhreagra335. Deputy Thomas Pringle asked the Minister for Finance the number and details of contracts currently held by his Department with a company (details supplied); and if he will make a statement on the matter. [48657/23]
Amharc ar fhreagra336. Deputy Thomas Pringle asked the Minister for Finance the number and details of contracts currently held by his Department with a company (details supplied); and if he will make a statement on the matter. [48690/23]
Amharc ar fhreagra337. Deputy Thomas Pringle asked the Minister for Finance the number and details of contracts currently held by his Department with a company (details supplied); and if he will make a statement on the matter. [48706/23]
Amharc ar fhreagraI propose to take Questions Nos. 326 and 335 to 337, inclusive, together.
The ‘National Public Procurement Policy Framework’ issued by the Office of Government Procurement (OGP) in November 2019, sets out the procurement procedures to be followed by government departments and state bodies in accordance with EU rules and national guidelines.
In addition, my Department has its own internal policy and guidance documents to assist staff to comply with all procurement regulations.
My Department does not hold currently hold any contracts with the companies named.
However, I am informed that following an open and competitive procurement process my Department appointed a panel of financial services advisors in October 2022. PwC were successful in being placed on that panel. The panel was appointed for an initial period of three years with an option to extend by one additional year. The members of the panel have each signed a framework agreement with my Department. Neither PwC or any other company are guaranteed work through that framework agreement. Engagement from the panel is subject to a further procurement process, generally with a competitive request for tender issued to the members of the panel. PwC do not hold any current contracts from this panel.
327. Deputy Barry Cowen asked the Minister for Finance to provide details on the position taken by Ireland in the European Union's decision to support the OECD's July 2023 Safe Harbour on UTPR; and the analysis considered in taking that position; and if he will make a statement on the matter. [48353/23]
Amharc ar fhreagraThe Deputy will recall that a Government decision was taken for Ireland to sign up to a global agreement on a two-pillared solution at the OECD Inclusive Framework to address the tax challenges associated with the digitalisation of the economy in October 2021. Pillar Two of that agreement sees the implementation of a global minimum tax of 15%. This decision was not taken lightly and came on the back of a broad public consultation process that sought the views of interested parties, including stakeholders from the business community.
It is important to recall the very real and substantial risks associated with potentially staying outside the OECD Agreement. As a small and open economy we have strong ties with the EU, US and other G20 countries and it remains essential for our long term competitiveness to ensure that we are remain in line with key partners.
At EU level, the Minimum Tax Directive has been agreed by all EU Member States. The directive ensures that there is a consistent application of Pillar Two of the OECD agreement across all Member States. Therefore, all EU Member States are legally bound to transpose the EU Minimum Tax Directive, and bring the primary rules into effect, by 31 December 2023.
The GloBE rules are a series of three interlocking rules designed to ensure the application of a 15% minimum effective corporate tax rate globally. It should be noted that there is also a specific rule order in respect of these rules which has been agreed at the OECD. This is salient in relation to the Undertaxed Payments Rule (UTPR) safe harbour which you have expressed concerns about.
The UTPR is designed to operate as a backstop to the IIR which itself comes after the QDTT in the globally agreed rule order. The UTPR enters into force a year later than the QDTT and the IIR to allow those rules an opportunity to bed in prior to the introduction of the backstop rule. The UTPR will be important in ensuring that the minimum tax is applied consistently across the globe.
A transitional UTPR Safe Harbour has been developed at the OECD. This will provide that, where the ultimate parent entity (UPE) of an MNE is located in a jurisdiction that has not implemented Pillar Two rules, and where that jurisdiction applies a domestic corporate income tax rate of at least 20%, the UTPR does not apply in respect of the UPE and any other group entities in that UPE jurisdiction.
These rules have been designed to mitigate complexity and disputes for businesses and tax administrations alike in year one. The safe harbour also recognises the challenges facing jurisdictions globally in implementing Pillar Two by providing a limited additional grace period before the UTPR takes effect.
Ireland will continue to play to the strengths of its wider offering beyond the tax system, a dynamic well-educated English speaking workforce, our common law legal system and business friendly environment, seeking to ensure our continued competitiveness in light of the impacts of Pillar Two implementation.
328. Deputy Ged Nash asked the Minister for Finance his views on a matter (details supplied); if his officials briefed him and-or his immediate predecessor on reported claims made by the senior official; when was he briefed by officials on these concerns; what action he took to address these concerns; if he plans to address these issues by means of amending legislation; and if he will make a statement on the matter. [48368/23]
Amharc ar fhreagraThe Deputy may wish to note that EU sanctions have direct effect in all Member States of the EU, and they are legally binding on all natural and legal persons. As such, a natural or legal person who contravenes a provision of an EU sanctions regulation would be guilty of an offence and liable to prosecution.
Ireland has strongly supported sanctions in response to Russia’s unjust and illegal invasion of Ukraine in February of 2022 while also consistently emphasising the importance of effective implementation. Eleven packages of sanctions have been agreed by the EU to date. A twelfth package of sanctions will be discussed in the coming weeks.
It is important to note that there is nothing specific in the Section 110 regime that is of particular relevance to Russian investors or originators. Therefore, all such vehicles are in scope of the sanctions regime.
In terms of the issues referred to in the article the Deputy has referenced, in April 2022, my predecessor was informed, as part of a summary of sanctions-related matters, that a concern had been raised regarding the need to ensure that adequate enforcement powers were in place to effectively implement EU sanctions and that an inter-Departmental Review Group was progressing work in this regard.
The Cross-Departmental International Sanctions Committee (CDISC) monitors, reviews, and coordinates the implementation, administration and exchange of information on sanctions in Ireland.
A review of domestic implementation of sanctions commenced in late 2021 which the inter-Departmental Review Group was tasked with overseeing. Given the shift in context for sanctions implementation following Russia’s invasion of Ukraine, this work has fundamentally evolved and progressed with a significant increase in the number and range of sanctions. The framework for domestic sanctions implementation in Ireland continues to be assessed by CDISC. Work is ongoing at CDISC to address any areas identified as requiring action.
Ireland has three competent authorities for all sanctions: the Department of Foreign Affairs, the Department of Enterprise, Trade & Employment and the Central Bank of Ireland. They oversee the different aspects of restrictive measures.
The Central Bank is responsible for the administration and enforcement of financial sanctions. In administering financial sanctions, the Central Bank undertakes the following:
(1) Receives notifications from the financial services industry of assets/funds that have been frozen under the sanctions legislation. In this regard, all natural and legal persons, entities and bodies are required to report information to the Central Bank on assets held by them on behalf of individuals or entities that are subject to an asset freeze. The Central Bank collates the reports of frozen assets for onward transmission to the Department of Foreign Affairs. Currently, approximately €1.8 billion in sanctioned assets has been frozen and notified to the Central Bank by Irish credit and financial institutions. (2) Assesses applications for derogations that are permitted under the restrictive measures legislation, such as Regulation 269/2014, in respect of financial sanctions.(3) Engages with the other domestic Competent Authorities and the European Commission to ensure that restrictive measures and financial sanctions are being implemented correctly and consistently. With respect to the EU’s implementation of sanctions, following Russia’s invasion of Ukraine, the Central Bank wrote to Special Purpose Entities (SPEs) with potential Russian links to seek confirmation of their adherence to the sanctions. The Central Bank engaged further with these identified firms, seeking confirmation of the specific steps they had taken to ensure compliance with financial sanctions and restrictive measures, reminding them of their ongoing obligations in this regard.
The Central Bank undertook an assessment of the information received, and based on that assessment, the Central Bank was satisfied that the identified SPEs had taken the necessary steps and had appropriate control frameworks in place to comply with the EU sanctions. The Central Bank did not uncover any actual or suspected breaches of EU sanctions in the course of this assessment. A breach of a financial sanction is a criminal offence under Irish legislation, and therefore, where the Central Bank is aware a breach has occurred or suspects a breach may occur, the matter is reported to An Garda Síochána.
In addition to the above assessment, since the implementation of the sanctions arising from the Russian invasion of Ukraine in February of 2022, the Central Bank has significantly increased its engagement with the financial services sector in order to support and ensure compliance with the EU sanctions. The Central Bank, as part of its ongoing supervision of credit and financial institutions, continues to engage with firms, both regulated and unregulated, to ensure that they have appropriate controls frameworks in place to meet their obligations in respect of financial sanctions and restrictive measures legislation.
The Deputy may also be interested to note that on 2 December 2022 the European Commission put forward a proposal for a Directive to harmonise criminal offences and penalties for the violation of EU restrictive measures (denoted as sanctions). The proposal sets out common EU rules which will make it easier to investigate, prosecute and punish violations of restrictive measures in all Member States alike. As this Directive has a Title V legal basis, Ireland has notified the Presidency of the Council of our intention to opt into this measure under Article 3 of Protocol 21. At last June’s Justice and Home Affairs Council, Ministers agreed a Council General Approach and trilogue negotiations are currently ongoing between the Council, European Parliament and European Commission in order to agree a final text.
329. Deputy Ged Nash asked the Minister for Finance to confirm how many enforcement actions the Central Bank has taken against Russian individuals or entities who are on the EU sanctions list since the current sanctions regime became operational in 2022, and who have a presence in the Irish financial services system vis a vis ‘Section 110’ Special Purpose Vehicles; how many live investigations are ongoing; and if he will make a statement on the matter. [48377/23]
Amharc ar fhreagraThe Deputy may wish to note that EU sanctions have direct effect in all Member States of the EU, and they are legally binding on all natural and legal persons. As such, a natural or legal person who contravenes a provision of an EU sanctions regulation would be guilty of an offence and liable to prosecution.
The Central Bank of Ireland is one of three Competent Authorities in Ireland tasked with the administration and enforcement of restrictive measures - tasked with the administration and enforcement of restrictive measures the others being the Department of Foreign Affairs and the Department of Enterprise Trade and Employment.
The Central Bank is responsible for the administration and enforcement of financial sanctions. In administering financial sanctions, the Central Bank undertakes the following:
• Receives notifications from the financial services industry of assets/funds that have been frozen under the sanctions legislation. In this regard, all natural and legal persons, entities and bodies are required to report information to the Central Bank on assets held by them on behalf of individuals or entities that are subject to the asset freeze. The Central Bank collates the reports of frozen assets for onward transmission to the Department of Foreign Affairs and the EU Commission.
• Assesses applications for derogations that are permitted under the restrictive measures legislation, such as Regulation 269/2014, in respect of financial sanctions.
• Engages with the other domestic Competent Authorities and the European Commission to ensure that restrictive measures and financial sanctions are being implemented correctly and consistently.
With respect to the EU’s implementation of sanctions, following Russia’s unjust and illegal invasion of the Ukraine in February of 2022, the Central Bank wrote to Special Purpose Entities (SPEs) with potential Russian links seeking confirmation of their adherence to the sanctions. The Central Bank engaged further with these identified firms to seek confirmation of the specific steps they had taken to ensure compliance with financial sanctions and restrictive measures while reminding them of their ongoing obligations in this regard.
The Central Bank undertook an assessment of the information received and, based on that assessment, the Central Bank was satisfied that the identified SPEs had taken the necessary steps and had appropriate control frameworks in place to comply with the EU sanctions. The Central Bank did not uncover any actual or suspected breaches of EU sanctions in the course of this assessment. A breach of a financial sanction is a criminal offence under Irish legislation and, as a result, where the Central Bank is aware a breach has occurred or suspects a breach may occur, the matter is reported to An Garda Síochána.
In addition to the above assessment, since the implementation of sanctions relating to the Russian invasion of Ukraine, the Central Bank has significantly increased its engagement with the financial services sector in order to support and ensure compliance with the EU sanctions. This work includes:
• The Central Bank wrote to firms to notify them of the imposition of the Russia/Ukraine sanctions and provided firms with a link to our dedicated web page on these sanctions. Furthermore, we reminded firms of the necessity to have robust processes in place to comply fully with their sanctions obligations and mitigate the risk to their businesses posed by the sanctions. Following this initial communication, and as part of our ongoing supervisory engagements with regulated entities, there has been a significant focus on Russian/Ukrainian-related issues and sanctions compliance.
• The Central Bank has required a very significant number of firms to submit specific information on their control frameworks for restrictive measures and financial sanctions. The Bank is analysing the information provided by these firms to identify any potential issues. Where appropriate, the Bank will take actions with respect to any identified issues.
• The Central Bank continues to engage with the European Commission, our European peers, the two other Irish Competent Authorities and regulated entities to ensure that there is strong and ongoing awareness of, and focus on, the EU sanctions regime, combined with the need for firms to continue to effectively implement all EU sanctions.
• Continuous updating of the Central Bank web page dedicated to the sanctions related to the Russian invasion of Ukraine, and use of appropriate social media channels to ensure that regulated entities have access to up-to-date information on financial sanctions and restrictive measures as well as the Central Bank’s expectations in relation to compliance with these measures.
In addition to the communication and ongoing engagement with regulated entities, the Central Bank wrote to various representative bodies in the non-regulated sector to alert them to their obligations under the sanctions regulations and to remind them in particular of the obligation to freeze and report the assets of sanctioned individuals.
