Written Answers Nos. 188-197
188. Deputy Pearse Doherty asked the Minister for Finance further to Parliamentary Questions No. 394 and 395 of 14 June 2022, the number of persons availing of tax relief on pension contributions in 2019 disaggregated by salary band in intervals of €10,000, on an individual level given that the PAYE data on employee pension contributions is now reported to the Revenue Commissioners. [33268/22]
View answer189. Deputy Pearse Doherty asked the Minister for Finance further to Parliamentary Questions No. 394 and 395 of 14 June 2022, the cost to the Exchequer of tax relief on pension contributions in 2019 disaggregated by salary band in intervals of €10,000, on an individual level given that the PAYE data on employee pension contributions is now reported the Revenue Commissioners. [33269/22]
View answerI propose to take Questions Nos. 188 and 189 together.
I am advised by Revenue that the number of individuals making pension contributions through employment in 2019, broken down by income range is published on the Revenue website at www.revenue.ie/en/corporate/documents/research/pmod-statistics-paper.pdf (Table 7).
I am also advised by Revenue that deductions to taxable income take place at a taxpayer unit level, where individuals who are jointly assessed are treated as one taxpayer unit, and their taxable income and tax liability is computed on the totality of their incomes, credits, deductions and reliefs. Therefore, it is not possible to provide an estimate of tax relief on pension contributions at an individual level. The analysis on a taxpayer unit level is available on the Revenue website at www.revenue.ie/en/corporate/information-about-revenue/statistics/income-distributions/pension-contributions.aspx.
190. Deputy Neale Richmond asked the Minister for Finance his views that the gap between the exit tax of 41% and the capital gains tax of 33% with an inclusion of a €1,250 exemption is to be maintained; his further views that the 41% rate of exit tax should be lowered; and if he will make a statement on the matter. [33292/22]
View answerThe Deputy should note at the outset that, while I acknowledge that there is a range of perspectives on the issue of exit taxes, I currently have no plans to make any change to either the exit tax or capital gains tax regime.
Capital gains tax (CGT) is a tax you pay on any capital gain (profit) made when you dispose of an asset. It is the chargeable gain that is taxed, not the whole amount you receive. The gain is usually the difference between the price you paid for the asset and the price you disposed of it for or the market value at the time of disposal.
There are a number of investment products which are subject to exit tax including life assurance policies, collective investment funds and ETFs. The normal tax treatment afforded to these products is that the funds invested are allowed to grow on a tax-free basis within the fund. This is known as the ‘gross roll-up’ regime. The income is taxed at the level of the investor rather than the fund, as is standard international practice.
The general thrust of the regime is that there is no annual tax on income or gains arising to a fund. However, a fund has responsibility to deduct exit tax in respect of payments made to certain unit holders in that fund when a ‘chargeable event’ occurs.
Finance Act 2006 introduced the concept of a deemed disposal as a new chargeable event. A disposal is deemed to occur 8 years following acquisition of a fund and then every 8 years thereafter. Any gain on the investment which arises from the date of acquisition to the date of the deemed disposal is subject to tax. This ensures that income cannot be rolled up indefinitely in the fund without being taxed. On the ultimate disposal of the investment any tax paid which arose as a result of a deemed disposal is allowed as a credit against any final tax liability on disposal.
Comparison of the rate of CGT and exit tax on a headline rate basis does not account for the fact that individual disposals within a fund are rolled up which allows the gross income earned or gains made to be reinvested by the fund until the occurrence of a chargeable event.
As the Deputy will be aware, as with all taxes, both CGT and exit tax are subject to ongoing review which includes the consideration and assessment of the rate along with any associated reliefs and exemptions. Tax policy and legislation are reviewed by the Tax Strategy Group as part of the annual Budget and Finance Bill process.
191. Deputy Patrick Costello asked the Minister for Finance if he will consider an amendment to the Credit Union Act 1994 to permit credit unions to include a statement when issuing the notice of the AGM to each eligible member in the notice to the effect that the annual accounts may be obtained on the website of the credit union or at the registered office of the credit union (details supplied); and if he will make a statement on the matter. [33302/22]
View answerThe Credit Union Act (the Act) currently requires credit unions to deliver a copy of the annual accounts, along with the notice of the AGM, to every eligible member which must be delivered to each member, unless the member has specifically opted in to receive the notice electronically.
Notice of general meetings
Section 80(2)(d) of the Act provides that notice of a general meeting must be delivered personally or by post to the auditor and to each member of the credit union and, if delivered by post to any member, must be so delivered to the address of that member as recorded in the books of the credit union.
Annual accounts
In respect of the annual general meeting, section 78(5) of the Act requires, among other things, that a copy of the annual accounts for the financial year in respect of which the meeting is held be delivered, together with the notice of the meeting, to every person entitled to receive such a notice.
Some credit unions are issuing notices of annual general meetings, including a copy of the annual accounts, to members by email (where individual members have opted in to this approach).
In Issue 7 of its sectoral Credit Union News publication (June 2017), the Central Bank included an article on electronic communications, which noted that while credit unions have specific legal obligations with regard to member notifications, many of these may be undertaken through electronic means, subject to them being in compliance with all legal requirements. The Central Bank also set out its expectations where credit unions wish to communicate with members by email.
Changes to Legislation
I am aware that this matter has been raised with my officials, who are examining it for potential inclusion in the Programme for Government Review of Policy of Framework which will propose legislative amendments to the Act.
In considering whether to make an amendment to the manner in which credit union members receive the annual accounts as part of notice of the AGM it is important to be mindful that the accounts should be accessible to all members.
192. Deputy James Browne asked the Minister for Finance the position regarding inheritance tax (details supplied); and if he will make a statement on the matter. [33317/22]
View answerI am advised by Revenue that for Capital Acquisitions Tax (CAT) purposes the relationship between the person giving a gift or inheritance (i.e. the disponer) and the person receiving it (i.e. the beneficiary) determines the maximum amount, known as the “Group threshold”, below which CAT does not arise.
The Group A threshold (currently €335,000) applies, inter alia, where the beneficiary is a child (including adopted child, stepchild and certain foster children) of the disponer. The Group B threshold (currently €32,500) applies where the beneficiary is a brother, sister, nephew, niece or lineal ancestor or lineal descendant such as a grandchild of the disponer. The Group C threshold (currently €16,250) applies in all other cases. The respective thresholds apply to all gifts and inheritances received within the same Group - they are never doubled. Therefore, a child will not be entitled to a Group threshold of €670,000 in any circumstance.
Any prior gift or inheritance received by a beneficiary since 5 December 1991 from within the same Group threshold is aggregated for the purposes of determining whether any tax is payable on a benefit. Where a person receives gifts or inheritances that are in excess of his or her relevant tax-free threshold, CAT at a rate of 33% applies on the excess.
Accordingly, where a person receives a gift or inheritance from a parent, the Group A threshold of €335,000 applies. In the circumstances described by the Deputy, the receipt by each child of benefits from his or her surviving parent will be aggregated with any benefits received from the parent who has died for the purposes of determining whether the threshold of €335,000 has been exceeded.
In addition to the above, a person may receive gifts up to a total value of €3,000 from any person in any calendar year without having to pay CAT (the “small gifts exemption”). Gifts within this limit are not taken into account in computing tax and are not included for aggregation purposes. For the purposes of determining whether the small gifts exemption is due, the relationship between disponer and beneficiary are not relevant, and the exemption is not transferable. In the circumstances described by the Deputy, each child would be entitled to receive gifts up to the value of €3,000 from the surviving parent in any calendar year. Prior to the death of their other parent, each child would have been entitled to receive gifts up to the total value of €3,000 from each parent free of tax, potentially having a combined total value of €6,000 each year.
193. Deputy Patricia Ryan asked the Minister for Finance his plans to address the rising cost of home heating oil; and if he will make a statement on the matter. [33405/22]
View answerThe Government is acutely aware of the increase in consumer prices in recent months, especially the increase in fuel and other energy prices including home heating oil, and for this reason it designed a package of measures to alleviate the impact of increased energy prices on households.
The package of measures includes:
- an energy credit of €200 including VAT, estimated to impact just over 2 million households
- a lump sum payment of €125 on the fuel allowance paid to 390,000 recipients
- an additional lump sum payment of €100 paid to all households in receipt of the fuel allowance
- a temporary reduction in public transport fares of 20% from the end of April to the end of the year. This will impact approximately 800,000 daily users of Bus Éireann, Iarnród Éireann, Dublin Bus, Go Ahead, Luas, DART and Local Link services.
- a reduction of the Drug Payment Scheme from €144 to €80 benefitting just over 70,000 families
- the working family payment budget increase was brought forward from 1 June to 1 April
- reduced caps for multiple children on school transport fees to €500 per family post primary and €150 for primary school children.
This package of measures built on measures already introduced in Budget 2022, provides support to all domestic electricity users via the energy credit and also provides targeted support to vulnerable households via the welfare system. Low income households have received an overall increase of 55% in Fuel Allowance support provided during the most recent Fuel Allowance season as compared to the previous season taking the €5 increase in the weekly payment introduced as part of the Budget last October, the €125 lump sum payment provided earlier this year together and the €100 extra May payment.
The Government announced a temporary reduction in the excise duties charged on petrol, diesel and marked gas oil. This measure, to the value of €320 million, was introduced with effect from 10 March reducing the VAT inclusive excise duty on petrol, diesel and MGO by 20, 15 and 2 cent per litre respectively. These reductions mitigate the cost of a fill of a 60 litre tank by some €12 for petrol and €9 for diesel. This assists all transport users, rural and urban, including commuters, business and farmers. These measures have been extended to 11 October 2022, with an additional 3 cent reduction for MGO. The extended measures will cost a further €97m.
In addition to these measures, the Government took the decision to reduce the rate of VAT on the supply of gas and electricity from 13.5% to 9% until October 31, 2022, costing an estimated €46m and resulting in estimated annual savings of €49 on gas and €69 on electricity bills for households. In relation to VAT on home heating oil, the position is that a reduced rate of 13.5% VAT currently applies to it. This rate is applied on the basis of a historical derogation from the standard VAT rate that should apply. The rate applied to domestic energy supplies such as oil and solid fuels is 13.5%. As this is a ‘parked’ rate it cannot be reduced below 12%.
The Government is of course very much aware of concerns regarding the ongoing impacts of increased energy prices and Government Departments will continue to monitor energy markets and consumer prices to ensure evidence based policy guidance in advance of Budget 2023.
In conclusion, I propose to keep the taxation of fuel including home heating oil under review as part of preparations for Budget 2023.
194. Deputy Patricia Ryan asked the Minister for Finance his plans to address the rising cost of petrol and diesel; and if he will make a statement on the matter. [33406/22]
View answerThe Government is very aware of the impact of rising fuel prices on households and businesses. These trends are driven primarily by global factors. The key drivers of this increase are increases in wholesale energy prices as a result of the rapid rebound in global demand, global supply chain disruptions and the imbalance between demand and supply that emerged as economies re-opened. More recently, as a result of the war in Ukraine, oil and gas prices have risen further. It is not possible for the Government to fully insulate consumers against these price impacts, however, a number of very significant steps have been taken to lessen the impact of increased fuel prices.
On fuel excise, a package of measures, to the value of €320 million, was introduced with effect from 10 March reducing the VAT inclusive excise duty on petrol, diesel and MGO by 20, 15 and 2 cent per litre respectively. These reductions mitigate the cost of a fill of a 60 litre tank by some €12 for petrol and €9 for diesel. This assists all transport users, rural and urban, including commuters, business and farmers. These measures have been extended to 11 October 2022, with an additional 3 cent reduction for MGO. The extended measures will cost a further €97m.
It should be noted that the above changes were made within the constraints of the Energy Tax Directive (ETD). The ETD prescribes minimum tax rates for fuel with which all Member States must comply. ETD provisions on mineral oils are transposed into national law in Finance Act 1999 (as amended). Finance Act 1999 provides for the application of excise duty, in the form of Mineral Oil Tax (MOT), to specified mineral oils, such as petrol, diesel, and kerosene, that are used as motor or heating fuels.
In addition to the above rate changes, I also brought forward legislation in Finance Act 2021 to provide for a temporary reduction of 1 cent per litre inclusive of VAT to MOT on petrol and diesel . This reduction came into effect on 1 April. I took this step to partially offset the expected rise in fuel costs arising from an increase in the Biofuel Obligation for transport fuels proposed by my colleague the Minister for Transport. Both rate cuts will remain in place until 11 October this year.
MOT rates on petrol since Budget night last year are summarised in the table below, along with comparisons with the ETD minimum rate.
|
Petrol rates/1,000L from |
MOT non-carbon |
MOT carbon |
Total MOT |
ETD minimum |
MOT > ETD minimum by |
|
13 October 2021 |
€541.84 |
€94.87 |
€636.71 |
€359.00 |
€277.71 |
|
10 March 2022 |
€379.24 |
€94.87 |
€474.11 |
€359.00 |
€115.11 |
|
1 April 2022 |
€371.11 |
€94.87 |
€465.98 |
€359.00 |
€106.98 |
MOT rates on auto-diesel are summarised in the table below, along with comparisons with the ETD minimum rate. Current rates will remain in place until 11 October this year.
|
Auto-diesel rates/1,000L from |
MOT non-carbon |
MOT carbon |
Total MOT |
Effective MOT incl. DRS |
ETD minimum |
MOT rate > ETD min. by |
Effective MOT > ETD minimum by |
|
13 October 2021 |
€425.72 |
€109.74 |
€535.46 |
€460.46 |
€330.00 |
€205.46 |
€130.46 |
|
10 March 2022 |
€303.77 |
€109.74 |
€413.51 |
€338.51 |
€330.00 |
€83.51 |
€8.51 |
|
1 April 2022 |
€295.64 |
€109.74 |
€405.38 |
€330.38 |
€330.00 |
€75.38 |
€0.38 |
The Diesel Rebate Scheme (DRS) was introduced in 2013 with the aim of providing support to road haulage and bus transport operators when the retail price of diesel is relatively high. The DRS operates on a sliding scale basis, whereby a partial rebate of MOT is available when the retail price of diesel exceeds €1.00 per litre excluding VAT. The repayment rate increases gradually as the retail price increases, up to a maximum repayment rate of 7.5 cents per litre/€75.00 per 1,000 litres. At current retail prices the repayment rate is at this maximum.
It is important to note that the effective MOT rate on auto-diesel must be considered in ensuring compliance with the ETD. The effective rate includes the maximum MOT rate repayable under the Diesel Rebate Scheme (DRS), currently €75.00 per 1,000 litres. The current MOT rate on auto-diesel is €405.38 per 1,000 litres, which is €75.38 above the ETD minimum. However, when the DRS is taken into account, the effective MOT rate is €0.38 per 1,000 litres, or 0.038 cents per litre, above the ETD minimum, meaning that any material reduction in the effective MOT rate would be incompatible with EU law.
Any reduction in the VAT on fuel/petrol would require the standard rate of VAT (23%) to be reduced. The estimated cost of a 1% reduction is €542m annually.
In conclusion, I propose to keep the taxation of fuel under review as part of preparations for Budget 2023.
195. Deputy Bernard J. Durkan asked the Minister for Finance if the Revenue Commissioners will meet with a person (details supplied) in order to further discuss their qualification as a new business owner; and if he will make a statement on the matter. [33552/22]
View answerFurther to my reply to Question 31645/22, the Deputy will be aware that the Employment Wage Subsidy Scheme (EWSS), as provided for in Section 28B of the Emergency Measures in the Public Interest (Covid-19) Act 2020, is administered under the care and management of the Revenue Commissioners. Revenue acknowledges that a significant number of businesses have been severely impacted by the COVID-19 pandemic and is aware that businesses relied on the unprecedented support of the EWSS to continue commercial operations. Revenue has confirmed that the scheme was operated as set out in the legislation and was administered on a “self-assessment” basis.
Revenue continues to work closely with businesses who have availed of the EWSS. With regard to the Deputy's specific question, I am advised by Revenue that while it has engaged extensively with the business in question. It is open to continued engagement with the business and is happy to meet them and their representatives to clarify any issues or queries they have. A Revenue official will contact the business/agent to discuss next steps.
196. Deputy Aengus Ó Snodaigh asked the Minister for Public Expenditure and Reform the reason that there is a closing time on gate into the Irish National War Memorial Gardens on Con Colbert Road, Dublin 8, given that other gates are never closed; if this is an oversight from the days when all gates closed at same time; and if consideration will be given by the OPW to leaving the gate open till later for example until 10 pm during summer months; and if there is a logical security and safety issue involved in relation to same. [33315/22]
View answerThe Irish National War Memorial Gardens are a beautiful amenity which open to the public from 8 am each morning. While the Park is accessible at all times, due to a public right of way, the OPW close all other gates. There is no public lighting in the Park which limits the time it can be safely accessed by the public. The closure of the gate at night helps to discourage anti-social behaviour when there are no OPW staff on site. This maintains and preserves the solemn, serene atmosphere of this elegant garden so that visitors can relax and reflect, on what this Memorial Garden represents. It should be noted that the closing times of these gardens are similar to those in other city parks.
The timing of the closure of the gate is operational as the staff involved have responsibilities at other sites. There is no consideration being given to changing the current closing time of 8:30 pm during the summer months.
197. Deputy Mick Barry asked the Minister for Public Expenditure and Reform if he will consider extending the special leave with pay scheme for public service staff; the measures that he will take to ensure those with long-Covid will not face cuts in income; and if he will make a statement on the matter. [33367/22]
View answer198. Deputy Richard O'Donoghue asked the Minister for Public Expenditure and Reform if discussions are expected in relation to the special leave for healthcare workers with long-Covid which they contracted through their work in a healthcare setting to be extended beyond the end of June 2022 given that many have the additional expense of travelling to Dublin for the necessary care; and if he will make a statement on the matter. [33416/22]
View answer199. Deputy Paul Kehoe asked the Minister for Public Expenditure and Reform the current position regarding the payment of long-term sick payments to front-line healthcare workers who suffer from long-Covid; the plans that are in place for the continued payment of these public sector employees; and if he will make a statement on the matter. [33496/22]
View answerI propose to take Questions Nos. 197 to 199, inclusive, together.
Reflecting the obligations to self-isolate laid down in public health advice and to assist in the prevention of the possible onward spread of the virus in the workplace, special leave with pay for COVID-19 arrangements were introduced by my Department in March 2020. This was a temporary measure in response to the unprecedented circumstances presented by the COVID pandemic. Special Leave with Pay has been used in lieu of sick leave across the Public Service to assist in the prevention of the possible onward spread of COVID-19 in the work premises.
From the outset of the pandemic my officials have been clear, via the “Guidance and FAQs for Public Service Employers during COVID-19” document, that Special Leave with Pay is a temporary measure which is kept under regular review. Changes have been made to the arrangements over the course of the last two years in line with changes to public health, Government guidance and the general return to the workplace.
It is important to note that Special Leave with Pay is not ending. From 1 July 2022, Special Leave with Pay for COVID-19 will continue to be available for the stated self-isolation period, which is currently 7 days. This is in keeping with the rationale of assisting in the prevention of the possible onward spread of COVID-19 in the work premises.
I would also point out that the Public Service Management (Sick Leave) Regulations were introduced in 2014. It was a significant reform development that standardised and simplified paid sick leave arrangements across all sectors of the Public Service. All illnesses are treated equally under the Public Service Sick Leave Regulations and equity is a fundamental part of the Scheme.
The Public Service Sick Leave scheme provides for the payment of the following to staff during periods of absence from work due to illness or injury:
- A maximum of 92 days on full pay in a rolling one year period
- Followed by a maximum of 91 days on half pay in a rolling one year period
- Subject to a maximum of 183 days paid sick leave in a rolling four year period
There is the potential for access to additional sick leave in certain circumstances as guided by the Critical Illness Protocol.
I understand that the Department of Health are working on a proposal to deal with certain "long COVID" cases in the health sector and my officials will examine any proposals as soon as they are finalised.
