Sean Fleming
Question:40. Deputy Sean Fleming asked the Minister for Transport the current position in relation to a ring road around Mountmellick, County Laois; and if he will make a statement on the matter. [45993/24]
View answerRoad Projects
Questions (40)
Written answers
As Minister for Transport, I have responsibility for overall policy and exchequer funding in relation to the National Roads Programme. Under the Roads Acts 1993-2015 and in line with the National Development Plan (NDP), the planning, design and construction of individual national roads is a matter for Transport Infrastructure Ireland (TII), in conjunction with the local authorities concerned. This is also subject to the Infrastructure Guidelines and the necessary statutory approvals. In this context, TII is best placed to advise you on the status of this project.
Noting the above position, I have referred your question to TII for a direct reply. Please advise my private office if you do not receive a reply within 10 working days.
A referred reply was forwarded to the Deputy under Standing Order 51.
Bus Services
Questions (41)
Pádraig O'Sullivan
Question:41. Deputy Pádraig O'Sullivan asked the Minister for Transport when the Kerry Pike and Clogheen bus will be operational in County Cork; and if he will make a statement on the matter. [45994/24]
View answerWritten answers
As Minister for Transport, I have responsibility for policy and overall funding in relation to public transport.
The National Transport Authority (NTA) has statutory responsibility for securing the provision of public passenger transport services nationally. The NTA also has national responsibility for integrated local and rural transport, including delivering the Connecting Ireland Rural Mobility Plan and New Town Services. The rollout of transport services in County Cork under the Connecting Ireland Rural Mobility Plan is dependent on the Annual Estimates Process.
In light of the NTA's responsibilities for the rollout of new and enhanced services, I have referred your question to the NTA for direct reply to you. Please advise my private office if you do not receive a reply within ten working days.
A referred reply was forwarded to the Deputy under Standing Order 51.
Bus Services
Questions (42)
Bernard Durkan
Question:42. Deputy Bernard J. Durkan asked the Minister for Transport whether a bus shelter might be provided at Robertstown West, Robertstown, County Kildare; and if he will make a statement on the matter. [46021/24]
View answerWritten answers
As Minister for Transport, I have responsibility for policy and overall funding in relation to public transport. The National Transport Authority (NTA) has responsibility for the planning and development of public transport infrastructure, including the provision of bus stops/shelters nationally.
Noting the NTA's responsibility in the matter, I have referred the Deputy's question to the NTA for a direct reply. Please contact my private office if you do not receive a reply within 10 days.
A referred reply was forwarded to the Deputy under Standing Order 51.
Primary Medical Certificates
Questions (43)
Danny Healy-Rae
Question:43. Deputy Danny Healy-Rae asked the Minister for Finance for an update on changes to a scheme (details supplied); and if he will make a statement on the matter. [45514/24]
View answerWritten answers
The Deputy should note that my Department and I share concerns that the Disabled Drivers and Disabled Passengers Scheme or DDS is no longer fit-for-purpose and believe it should be replaced with a needs-based, grant-led approach for necessary vehicle adaptations that could serve to improve the functional mobility of the individual.
However, this is very much a matter for Government as whilst my Department has oversight of the DDS, I do not have responsibility for disability policy.
As the Deputy is aware the National Disability & Inclusion Strategy or NDIS Transport Working Group recommended that the DDS be replaced with a modern, fit-for-purpose vehicular adaptation scheme. This is in line with the general view that we need to move away from a medical criteria-based approach to a needs-based approach.
Under the aegis of the Department of the Taoiseach, the sub-group convened to progress NDIS proposals for needs-based, grant-aided, modern vehicle adaptation supports to replace the DDS, have generated a report that is currently being finalised.
In that context, any further changes to the existing DDS would run counter to NDIS proposals to entirely replace the scheme with a modern, fit-for-purpose vehicular adaptation scheme.
Employment Rights
Questions (44)
Richard Bruton
Question:44. Deputy Richard Bruton asked the Minister for Finance if he is aware the new Revenue Commissioners rulings following a Supreme Court ruling on the boundary between self-employment and employee status appears to have required that media companies making advertisements which might be extremely short contracts are being obliged to treat people as employees, whereas in the UK, the Revenue system recognises the special conditions which apply in that subsector; and if he will make a statement on the matter. [45527/24]
View answerWritten answers
On 20 October 2023, the Supreme Court, in a unanimous decision, delivered an important judgment on the key factors to be considered when classifying an individual’s employment status for Irish income tax purposes.
The detailed judgment was delivered by Mr. Justice Brian Murray in The Revenue Commissioners v. Karshan (Midlands) Ltd. t/a Domino’s Pizza. The case was concerned with whether delivery drivers were independent contractors under a “contract for service” and taxable under Schedule D of the Taxes Consolidation Act 1997, or employees under a “contract of service”, and taxable under Schedule E of that Act (PAYE).
The judgment provides an extensive review of relevant case law, and succinctly summarises it through the provision of a five-step decision-making framework. The decision-making framework consists of five questions that are to be used to resolve the question of whether a contract is one of service (employee) or for service (self-employed). Under the self-assessment tax system, each business making payments to individuals is obliged to correctly determine whether individuals are employed or self-employed, based on the facts and circumstances of each relationship and payment, through the application of the five-step framework. While the judgment related to a company engaging individuals as delivery drivers, as a decision of the Irish Supreme Court, the judgement has application across all sectors, including media companies making advertisements.
Regarding the Deputy’s comment about the approach taken in the UK, it is important to note that the UK has an entirely different legislative framework to that which operates in Ireland. The approach taken in the UK cannot be adopted in Ireland as it would be contrary to Irish legislation and its interpretation, as laid down by the Supreme Court judgment. Revenue, in carrying out its statutory function, is obliged to apply the judgment and has no discretion whatsoever on this matter.
To assist taxpayers in understanding their tax obligations, Revenue publishes detailed guidance on many topics, on its website and in the various Tax and Duty Manuals. Revenue developed a detailed Tax and Duty Manual (TDM) to outline its position in relation to the application of the judgment and to assist businesses who engage individuals to carry out work. The TDM (Part 05-01-30) was published 21 May 2024 and is available on the Revenue website at the following link: www.revenue.ie/en/tax-professionals/tdm/income-tax-capital-gains-tax-corporation-tax/part-05/05-01-30.pdf.
The TDM provides general guidance and commentary but cannot cover every eventuality and circumstance. The key message in the TDM is that, in determining whether an individual is self-employed or an employee, the business (entity engaging the person) must apply the five-step framework by reference to the facts and circumstances of the individual case.
The Deputy mentions that businesses involved in the making of advertisements are now required to employ persons who provide services to them for short-term contracts. The judgment outlines different types of arrangements where the engagement may result in a worker being considered as an employee for tax purposes only, including confirming that a single engagement can give rise to such an outcome. However, the judgement is clear that each payment and engagement must be considered separately considering the full facts and circumstances of that specific engagement.
The TDM represents Revenue guidance, however, I am informed by Revenue that it has not imposed any approach as it is the Supreme Court who has set down the conditions that need to be applied when classifying an individual’s employment status. It is important to note that the judgement also relates to employment status for income tax purposes only and not employment law generally. It has also always been a matter for a business engaging the individual to determine whether that individual is an employee for tax purposes.
Businesses are free to disagree with elements of the TDM and self-assess based on the facts and circumstances of their own case. Revenue will then, in the normal way, look at cases based on risk and make assessments or amended assessments where appropriate and a right of appeal exists, which may lead to future litigation in this area.
Primary Medical Certificates
Questions (45)
Pádraig O'Sullivan
Question:45. Deputy Pádraig O'Sullivan asked the Minister for Finance when the report on the proposed changes to the criteria for the primary medical certificate will be published; if his Department has seen the report; and if he will make a statement on the matter. [45375/24]
View answerWritten answers
The Deputy should note that my Department and I share concerns that the Disabled Drivers and Disabled Passengers Scheme or DDS is no longer fit-for-purpose and believe it should be replaced with a needs-based, grant-led approach for necessary vehicle adaptations that could serve to improve the functional mobility of the individual.
However, this is very much a matter for Government as whilst my Department has oversight of the DDS, I do not have responsibility for disability policy.
As the Deputy is aware the National Disability & Inclusion Strategy or NDIS Transport Working Group recommended that the DDS be replaced with a modern, fit-for-purpose vehicular adaptation scheme. This is in line with the general view that we need to move away from a medical criteria-based approach to a needs-based approach.
The current position is under the aegis of the Department of the Taoiseach, the sub-group convened to progress NDIS proposals for needs-based, grant-aided, modern vehicle adaptation supports to replace the DDS, have generated a report that is currently being finalised.
In that context, any further changes to the existing DDS would run counter to NDIS proposals to entirely replace the scheme with a modern, fit-for-purpose vehicular adaptation scheme.
Insurance Industry
Questions (46, 76)
Ruairí Ó Murchú
Question:46. Deputy Ruairí Ó Murchú asked the Minister for Finance the short- to medium-term plans by Government to ensure reductions in premiums for insurance products, particularly public liability insurance; and if he will make a statement on the matter. [45385/24]
View answerBernard Durkan
Question:76. Deputy Bernard J. Durkan asked the Minister for Finance the extent to which the insurance industry here remains competitive when compared with insurance costs throughout the European Union notwithstanding any national difference that may apply; the work in hand to reduce the cost of insurance across all sectors; and if he will make a statement on the matter. [46040/24]
View answerWritten answers
I propose to take Questions Nos. 46 and 76 together.
Insurance reform is a priority for this Government, and is being delivered via the Action Plan for Insurance Reform. This whole-of-Government initiative is designed to ensure the affordability and accessibility of this key financial service. The vast bulk of objectives contained within the Action Plan are now complete, and the importance Government places upon it is demonstrated by the fact that it is overseen by a Cabinet Committee Sub-Group on Insurance Reform, chaired by the Tánaiste. The Action Plan for Insurance Reform has included significant achievements since 2020, most notably the rebalancing of the Duty of Care, reforming the Injuries Resolution Board and introducing the new Personal Injury Guidelines. These will benefit all insurance lines including, personal, commercial and liability cover. In addition, in part due to the more attractive operating environment here, new competitors such as OUTsurance, Revolut and Fastnet have entered the motor insurance market, enhancing competition and capacity. This key motor insurance segment best reflects the impact of our domestic reforms. There has been a reduction in premiums of the order of 40 percent since December 2016 in this country, versus a 20 percent increase across the euro area.
Minister of State Neale Richmond has held a number of meetings with the main insurers in the Irish market to set out the Government’s expectation that savings arising from this whole-of-Government reform agenda will be reflected via reduced premiums, as well as increased availability of cover. Indeed, we have recently seen a number of new entrants to the market with some existing incumbents expanding their risk appetite to new areas, including hospitality, SMEs, sports and leisure activities. This represents a vote of confidence in the Government’s reforms and the wider insurance market here. It should be noted that more widely, the global insurance market shows signs of hardening and that Government policy seeks to reform the domestic insurance environment to ensure that Ireland is well-placed to compete for international capital, thereby consolidating the gains made through the Government reform agenda.
In conclusion, I wish to reassure the Deputy that Government policy is firmly targeted on ensuring that the benefits arising from the entire reform programme are realised, for consumers, businesses, and community and voluntary groups across Ireland.
Insurance Industry
Questions (47)
Ruairí Ó Murchú
Question:47. Deputy Ruairí Ó Murchú asked the Minister for Finance to provide an update on the work of the Office for the Promotion of Competition in the Insurance Market, particularly in relation to reducing the cost of public liability insurance; and if he will make a statement on the matter. [45386/24]
View answerWritten answers
Insurance reform is a key priority for this Government and is being delivered via the Action Plan for Insurance Reform. The latest Implementation Report demonstrates that significant progress has been made, with 95 percent of the actions contained in the Action Plan now either delivered or initiated.
The establishment of the Office to Promote Competition in the Insurance Market is a Programme for Government commitment. Chaired by Minister of State Richmond, its aims are to help expand the risk appetite of existing insurers and explore opportunities for new market entrants. Since its establishment, the Office has played a role in helping to encourage the availability of insurance cover including for various “pinch-point” sectors including equestrian activities, inflatable hire, and childcare. Through leveraging the Government's insurance reform agenda, the Office has successfully helped facilitate the availability of insurance in previously challenging areas, in turn contributing to a more competitive market.
This collaborative approach involves connecting groups facing insurance challenges with relevant stakeholders and separately engaging with IDA Ireland to help attract new insurers to the Irish market. We have seen encouraging signs of heightened competition in the market recently, with new entrants OUTsurance, Revolut and Fastnet offering further choice and competition to consumers.
In addition, Minister Richmond has chaired a number of insurance roundtables with sectoral stakeholders, and has received positive feedback on increasing international interest in the Irish market. The Deputy will be interested to know that some participants at the recent Brokers roundtable noted a decline in insurance rates and an increase in available capacity. This is a sign that the Government’s reform agenda is having the desired effect. In tandem with this, the Office has observed an increase in Managing General Agent activity within the market, which points towards a growing specialisation and a competitive environment for niche areas which had traditionally sought cover from overseas.
As well as the above, Minister Richmond has met with the main insurers in the State on a number of occasions in his capacity as Chair of the Office and impressed upon them the need to pass on savings achieved through the reform agenda in the form of reduced premiums and expanded risk appetite. At these meetings, he has received positive feedback on the expansion of product lines, improving risk appetite, the implementation of the Government reform agenda, and the regulatory environment.
In conclusion, I wish to assure the Deputy of my intention to continue to work closely with my Government colleagues to ensure further implementation of the Action Plan which, in tandem with the work of the Office to Promote Competition, should have a positive impact on the affordability and availability of insurance for all consumers.
Banking Sector
Questions (48)
Rose Conway-Walsh
Question:48. Deputy Rose Conway-Walsh asked the Minister for Finance for an update on his engagement with the Banking and Payments Federation and his Department with respect to the defective concrete blocks redress scheme; and if he will make a statement on the matter. [45420/24]
View answerWritten answers
As the Deputy is aware, the overall Government response relating to the defective concrete blocks grant scheme is led by my colleague the Minister for Housing, Local Government and Heritage who has put in place a scheme of financial support to help affected homeowners.
As part of this engagement, I am aware that the Minister for Housing has established an Implementation Steering Group to work through administrative issues around the scheme as they arise and make recommendations if further changes to the regulations or guidelines of the scheme are needed.
In order to explore certain financial issues facing homeowners, the Department of Housing established a subgroup of the Implementation Group, which is chaired by that Department and attended by officials from the Department of Finance and the BPFI, as well as officials from Local Authorities, the Housing Agency, the Homeowners’ Liaison Officer and affected homeowners.
My Department maintains contact with the BPFI on an on-going basis across a range of issues. At an official level, there is also ongoing engagement on a range of matters, as required, between the Department of Housing, Local Government and Heritage and the Department of Finance.
The Government fully understands the importance of this issue in the communities affected by defective concrete blocks and I will continue to work with my Government colleagues, as necessary, to ensure that the Scheme operates effectively and consistently for all affected homeowners who access it.
Banking Sector
Questions (49)
Rose Conway-Walsh
Question:49. Deputy Rose Conway-Walsh asked the Minister for Finance to provide an update on his engagements with the retail banking sector regarding the provisions for forbearance measures and financing for mortgage holders whose homes are affected by defective blocks; and if he will make a statement on the matter. [45421/24]
View answerWritten answers
I understand the very difficult situation faced by homeowners whose houses are affected by defective concrete blocks and, as the Deputy is aware, the Government response on this issue is led by my colleague the Minister for Housing, Local Government and Heritage.
In relation to impacted households who have a mortgage with a Central Bank regulated entity, the provisions of the relevant financial services regulatory framework is available to protect and assist such borrowers. This includes the Central Bank Code of Conduct on Mortgage Arrears 2013 (CCMA) which provides important protections for borrowers who are in, or who are facing, arrears on a mortgage which is secured on a primary residence.
The CCMA requires that all regulated mortgage entities have fair and transparent processes in place to deal with relevant borrowers and it sets out the process that such entities must follow when a borrower is experiencing repayment difficulty. It also provides that due regard must be given to the fact that each case of mortgage repayment difficulty is unique and that it needs to be considered on its own merits.
Also, all cases must be handled sympathetically and positively by the regulated entity, with the objective at all times of assisting the borrower to meet his or her mortgage obligations. In the case of a mortgage repayment difficulty, entities must explore all of the options for alternative repayment arrangements (ARAs) offered in order to determine which ARA, if any, is appropriate and sustainable for the borrower’s individual circumstances. The CCMA also provides for an appeals mechanism, including where the entity declines to offer an ARA or where the borrower is not willing to enter into the ARA offered by the regulated entity.
In relation to any request for new credit, subject to compliance with the applicable consumer protection regulatory framework governing the provision of credit to consumers, the decision on such applications are a commercial matter for the individual lender. Regulated entities must also ensure that their staff are adequately trained to deal with the type of arrears (and pre-arrears) cases presenting to them and with any mortgage application.
This regulatory framework should ensure that all Central Bank regulated entities will deal with defective concrete block impacted households in an appropriate and supportive manner having regard to the unique circumstances that they face and I would call on all regulated mortgage entities to ensure that all such mortgaged households are supported in their difficult situation.
Small and Medium Enterprises
Questions (50)
Brendan Smith
Question:50. Deputy Brendan Smith asked the Minister for Finance the taxation measures that will be introduced in 2025 to ease the pressures on small and medium enterprises; and if he will make a statement on the matter. [45430/24]
View answerWritten answers
SMEs are the foundation of the Irish economy, accounting for the majority of employment in the State. Their vital importance to our economy is reflected in our Programme for Government commitments. The tax system contains a number of incentives and reliefs designed to support SMEs. This Government has been proactive in both reviewing these measures and introducing targeted new supports, and I have progressed this work by enhancing existing schemes in Budget 2025.
Tax Incentives for investments in small and medium enterprises
One issue which is consistently raised by the SME community is difficulty in raising finance. Taxation measures which are available to help SMEs to access investment, scale-up and expand include the Employment Investment Incentive (EII), the Start-Up Relief for Entrepreneurs (SURE), the Start-Up Capital Incentive, and the new Investor Relief for business angels.
I announced enhancements to EII, SURE and SCI in Budget 2025. The reliefs will be extended for a further two years to the end of 2026. The investment limit on the amount that an investor can claim relief on under the reliefs will be doubled from €500,000 up to €1 million. For SURE, the maximum qualifying investment in respect of which an investor may claim relief on over a seven-year period is being increased to €980,000 (€140,000 per annum).
Recognising the Government’s commitment to cultivate a thriving business angel investment ecosystem in Ireland, I announced on Budget Day that the lifetime limit on gains that an investor may avail of the reduced Capital Gains Tax rate is being increased from €3 million to €10 million.
Section 486C Start Up Relief
Section 486C Start Up Relief provides a corporation tax relief for new small companies in the first 5 years of trading. In broad terms, it allows relief of up to €40,000 per year against Corporation Tax (CT) liabilities, which may be carried forward where not fully used in the five years.
The relief is currently calculated by reference to Employers’ PRSI, up to a maximum of €5,000 per employee. Budget 2025 will extend the qualifying criteria to allow up to €1,000 of Class S PRSI per individual to count towards the €40,000 cap. Company directors who are owner/managers are generally liable to Class S PRSI, which does not have an Employers’ PRSI component, therefore small owner-operated companies may not have qualified for this relief to date. This will provide much needed support for small, owner-managed start-up companies.
Research and Development Tax Credit
In order to support companies undertaking smaller Research and Development (R&D) projects, in Budget 2025 I have increased the first-year payment threshold of the R&D Tax Credit from €50,000 to €75,000. This means that the first €75,000 of an R&D corporation tax credit can be paid in full in the first year of the claim, rather than being spread over the normal three-year payment window. This will be a valuable cash-flow support to all companies engaged in R&D projects.
This change maintains the Government’s focus on enterprise supports for productive and innovative businesses in the State.
Deduction for stock exchange listing expenditure
I announced in Budget 2025 a new tax deduction for expenses relating to a first listing (IPO) on a stock exchange in Ireland or the wider EEA. An overall cap of €1 million of expenses per listing will apply, with the relief being claimable by a company in the year of first successful listing. This measure will support businesses in the scale-up phase of their growth and development. It is aimed at encouraging more stock exchange listings - thereby providing wider positive benefits for the Irish economy.
VAT Registration Thresholds
From 1 January 2025, the existing VAT Registration Thresholds will be increased from €40,000 for services and €80,000 for goods to €42,500 for services and €85,000 for goods. This will assist small businesses with recent rises in inflation.
Participation Exemption for Foreign Dividends
I am introducing a new Participation Exemption for Foreign Dividends to simplify the existing double taxation relief provisions. The participation exemption for foreign-sourced dividends will work by providing alternative double tax relief for dividends by exempting qualifying dividend income received from corporation tax. This will provide businesses, including SME companies with a foreign subsidiary, an alternative, much simplified mechanism for double tax relief by reducing the complexity and administrative burden of the current system of double tax relief.
Small Benefit Exemption
The Small Benefit Exemption allows an employer to provide limited non-cash benefits or rewards to their workers without the payment of income tax, PRSI and USC.
As announced on Budget Day, I am increasing the annual limit provided for in the exemption from €1,000 to €1,500 and will also permit five non-cash benefits to be granted by an employer in a single year under this exemption. This change will allow employers greater flexibility in giving non-tax rewards to their employees. This means that workers may receive up to three additional tax-free rewards or gifts, for instance to reward exceptional performance, or mark significant life events.
Further information on these incentives is available on the Revenue website at www.revenue.ie.
Small and Medium Enterprises
Questions (51)
Brendan Smith
Question:51. Deputy Brendan Smith asked the Minister for Finance if he will outline his recent engagement with the SME sector, with particular reference to the sector’s concern about increased costs; and if he will make a statement on the matter. [45431/24]
View answerWritten answers
Small and medium enterprises are the life-blood of the Irish economy, accounting for the majority of employment in the State, and this government is committed to supporting small businesses so they can continue to thrive. SME’s vital importance to our economy is reflected in our Programme for Government commitments.
As Minister for Finance I have proactively engaged with SMEs and SME representative bodies covering almost every sector, from technology companies to small local retailers. Over the last number of weeks and months I have listened to the concerns raised by small businesses and industry bodies from across the country, in particular during the Budgetary process. I am cognisant of the challenges facing SMEs. A number of supports have been put in place by Government to assist SMEs with these challenges.
Supports under the remit of my Department include tax based measures and I have announced a number of enhancements to schemes in Budget 2025. Examples of these changes include an increase to the VAT registration thresholds, an increase in the R&D Tax Credit, enhancements to the to the Employment Investment Incentive and adjustments to the Small Benefit Exemption.
Moreover, the Strategic Banking Corporation of Ireland falls under my Department’s remit. It currently has two schemes open for applications from SMEs (and farmers) which aim to facilitate access to credit at competitive prices in these areas important to SMEs and Government, namely challenges arising from invasion of Ukraine by Russia, growing businesses and investing in sustainability. The Ukraine Credit Guarantee Scheme and the Growth and Sustainability Loan Scheme were both developed in conjunction with the Department of Enterprise, Trade and Employment, and the Department of Agriculture, Food and the Marine.
The Ukraine Credit Guarantee Scheme opened for applications on 20 March 2023 and provides a lending capacity of €1.2 billion, offering low cost working capital to SMEs, primary producers (i.e. farmers and fishers) and small mid-caps (businesses with fewer than 500 employees), which have been affected by the economic consequences of the conflict in Ukraine. Loans under this scheme can range from €10,000 to €1 million, repayable over a maximum of six years. Loans of up to €250,000 do not require collateral or a personal guarantee.
The €500 million Growth and Sustainability Loan Scheme was launched on 19 September 2023. This scheme is targeted towards the support of SMEs and farmers to grow their businesses, increase their resilience and enable them to transition to environmentally sustainable practices and systems. It provides for loans to SMEs, including primary producers, ranging from €25,000 to €3 million, for terms of seven to ten years. Loans of up to €500,000 can be provided on an unsecured basis.
Furthermore, I have worked closely with colleagues in Government in particular the Minister for Enterprise, Trade and Employment who has policy responsibility for SMEs in ensuring the concerns of SMEs are taken on board.
The Department of Enterprise, Trade and Employment has a number of initiatives in place specifically targeted at supporting SMEs. The SME package announced on Budget day focused on retail and hospitality sectors in particular. For example, the Power Up Grant was announced in Budget 2025, targeted at businesses in the retail and hospitality sectors. It offers a one-off flat payment of €4,000 to eligible businesses, and is administered via Local Authorities. This grant is a follow-up to the Increased Cost of Business scheme which has paid out over €244 million this year to approximately 75,000 SMEs (38,000 in the retail and hospitality sectors).
Further information on these incentives is available on the Revenue website at www.revenue.ie and on the National Enterprise Hub at www.neh.gov.ie.
Small and Medium Enterprises
Questions (52)
Richard Bruton
Question:52. Deputy Richard Bruton asked the Minister for Finance if an analysis of VAT returns reveals a pattern of a difficult time for small high-street businesses in the form of trends in yields, business closures or payment difficulties; and if he will make a statement on the matter. [45435/24]
View answerWritten answers
I am advised by Revenue that the periodic VAT returns represent a high-level summary in respect of VAT payable and/or VAT reclaimable and do not provide sufficiently detailed data to support the type of analysis sought by the Deputy.
Regarding payment difficulties, Revenue’s clear preference is always to engage with taxpayers and businesses, and, where possible, to agree mutually acceptable payment arrangements in preference to deploying debt collection/enforcement sanctions. Revenue has a strong track record of successfully working with individuals and businesses to resolve their payment difficulties. In most cases, a mutually satisfactory solution is found without resorting to enforcement action. For example, taxpayers can enter into a Phased Payment Arrangement to pay off their debt in instalments over a period of time.
On completion of the Debt Warehousing Scheme in May 2024, over 12,700 Phased Payment Arrangements were agreed with taxpayers to secure a total of €1.2 billion of tax debt. I am advised by Revenue that this is the highest ever number of payment arrangements. The vast majority of these arrangements are still in place and being serviced by customers.
I am also advised by Revenue that, while the number of insolvencies to date this year has risen in comparison with the last few years, it is back to the levels that applied in 2018/2019.
Departmental Reports
Questions (53)
Richard Bruton
Question:53. Deputy Richard Bruton asked the Minister for Finance if he has studied the recent report from his Department on the difficulty of securing funding for multi-unit developments, and if there are implications for public policy; and if he will make a statement on the matter. [45439/24]
View answerWritten answers
As the Deputy is aware, overall housing policy is the responsibility of my colleague the Minister for Housing, Local Government and Heritage.
In relation to the availability of funding for residential development specifically, viability remains the primary challenge for securing funding for residential housing development. When a project is viable, funding is available.
However, as the Deputy is aware, viability is a challenge in certain segments. For the development of houses, there is an active funding market across all tenure types. There is strong competition across the segment, with domestic banks, secondary and alternative lenders and State-backed entities all very active in funding the delivery of housing developments.
Houses can be built and sold in phases, which reduces risk and allows for development capital to be recycled for further phases of the development. Furthermore, houses are less costly to develop than apartments, resulting in higher demand for finished products and less concerns on affordability for purchasers.
Apartment development, on the other hand, is more challenged on viability grounds. Apartments are costly to develop, very capital intensive and higher risk from both a lending and development perspective.
As the Deputy is aware, Government policy acknowledges the need for a consistent supply of housing for all tenure types and Housing for All sets out the range of actions necessary to increase the supply of housing across all tenure types. Through the implementation of Housing for All, the Government has invested unprecedented levels in housing delivery, including a number of measures to support viability, supporting the completion of 32,695 homes in 2023 and the commencement of 49,007 homes in the first nine months of 2024.
Tax Data
Questions (54)
David Stanton
Question:54. Deputy David Stanton asked the Minister for Finance further to Parliamentary Question No. 200 of 7 March 2024, the number of vacant homes tax (VHT) returns received by the Revenue Commissioners, by each local authority area, from 31 October 2023 to date, in tabular form; the number of exemptions to the VHT applied for; the number of these applications allowed; the amount collected in respect of each local authority area; and if he will make a statement on the matter. [45464/24]
View answerWritten answers
Vacant Homes Tax (VHT) is administered by Revenue in accordance with Part 22B of the Taxes Consolidation Act 1997 (TCA 1997). A residential property will be within the scope of the tax if it has been occupied as a dwelling for less than 30 days in a chargeable period. Each chargeable period commences on 1 November and ends on 31 October of the following year.
The first chargeable period commenced on 1 November 2022 and ended on 31 October 2023. The first self-assessed returns were due on 7 November 2023 and the associated tax payable on or before 1 January 2024. The second chargeable period commenced on 1 November 2023 and ended on 31 October 2024, with self-assessed returns due on 7 November 2024 and the associated tax payable on or before 1 January 2025.
VHT operates on a self-assessment basis, where the number of properties in scope and the amount of tax payable depends on the self-assessed returns submitted by property owners, the number of properties declared as liable, and the number of property owners entitled to claim available exemptions from the tax. Chargeable persons are required to retain records to verify that the information declared on their VHT return is accurate. These records may include, but are not limited to, documents relating to the use of a residential property during a chargeable period, any claim for exemption from VHT or any evidence relating to the property being outside the scope of VHT for a chargeable period.
Further information regarding VHT, including VHT exemptions, is available on the Revenue website at: www.revenue.ie/en/property/vacant-homes-tax/index.aspx
I am advised by Revenue that, as of 5 November 2024, 6,655 returns have been filed for the first VHT chargeable period (1 November 2022 to 31 October 2023) where the property has been declared as vacant. Of these, 3,942 are liable for VHT and 2,713 are declared on the self-assessed return as exempt from VHT. Revenue notes that the data may be subject to revision if returns are amended.
The table below provides a breakdown of VHT returns and VHT liability by Local Authority for the first VHT chargeable period.
Information in relation to the second chargeable period is not yet available, as the return filing deadline for this chargeable period has not yet passed.
|
Local Authority |
Total VHT Returns |
of which: VHT Payable |
of which: VHT Exempt |
VHT Liability: €M |
|
Carlow |
51 |
25 |
26 |
0.01 |
|
Cavan |
164 |
117 |
47 |
0.03 |
|
Clare |
119 |
76 |
43 |
0.04 |
|
Cork City |
213 |
85 |
128 |
0.05 |
|
Cork County |
567 |
339 |
228 |
0.14 |
|
Dun Laoghaire-Rathdown |
225 |
97 |
128 |
0.16 |
|
Donegal |
455 |
308 |
147 |
0.09 |
|
Dublin City |
745 |
342 |
403 |
0.62 |
|
Fingal |
201 |
105 |
96 |
0.14 |
|
Galway City |
112 |
62 |
50 |
0.03 |
|
Galway County |
213 |
146 |
67 |
0.06 |
|
Kerry |
472 |
298 |
174 |
0.15 |
|
Kildare |
188 |
114 |
74 |
0.07 |
|
Kilkenny |
101 |
61 |
40 |
0.02 |
|
Laois |
120 |
96 |
24 |
0.01 |
|
Leitrim |
85 |
52 |
33 |
0.01 |
|
Limerick |
441 |
302 |
139 |
0.10 |
|
Longford |
53 |
31 |
22 |
0.01 |
|
Louth |
169 |
94 |
75 |
0.03 |
|
Mayo |
370 |
236 |
134 |
0.08 |
|
Meath |
124 |
71 |
53 |
0.04 |
|
Monaghan |
60 |
36 |
24 |
0.01 |
|
Offaly |
76 |
52 |
24 |
0.02 |
|
Roscommon |
110 |
68 |
42 |
0.03 |
|
Sligo |
163 |
97 |
66 |
0.03 |
|
South Dublin |
143 |
63 |
80 |
0.06 |
|
Tipperary |
202 |
117 |
85 |
0.04 |
|
Waterford City |
165 |
106 |
59 |
0.04 |
|
Westmeath |
77 |
42 |
35 |
0.01 |
|
Wexford |
244 |
149 |
95 |
0.06 |
|
Wicklow |
227 |
155 |
72 |
0.16 |
|
Total |
6,655 |
3,942 |
2,713 |
2.36 |
Economic Policy
Questions (55, 83)
Bernard Durkan
Question:55. Deputy Bernard J. Durkan asked the Minister for Finance to indicate the extent to which this country’s economy continues on a stable footing, notwithstanding any potential threat; and if he will make a statement on the matter. [45466/24]
View answerBernard Durkan
Question:83. Deputy Bernard J. Durkan asked the Minister for Finance how he sees this country’s economy progressing and comparable to other EU economies; and if he will make a statement on the matter. [46047/24]
View answerWritten answers
I propose to take Questions Nos. 55 and 83 together.
The Irish economy is in relatively good shape at an aggregate level, reflecting the easing in inflation and the solid growth in the domestic economy over recent quarters. The brightest spot in the Irish economy has undoubtedly been the labour market. There were over 2.75 million people in employment in the second quarter of 2024 as participation rates reached a record high. The unemployment rate also remains low by historical standards and consistent with full employment.
Inflation has fallen rapidly throughout the year, with headline inflation at or below 2 per cent since March. The fall in inflation has largely been driven by energy price decreases, however domestic price pressures have also eased over recent months.
Looking ahead, real income growth should support a continued expansion of consumer spending this year and next. Indeed, consumer spending is expected to act as the primary driver of growth in the domestic economy. My Department now forecasts Modified domestic demand (MDD), the preferred measure for the domestic economy, to grow by 2.6 per cent for this year and 2.9 per cent next year.
From a comparative perspective, there was subdued growth (0.4 per cent) in the European economy last year. While growth has picked-up somewhat this year, the outlook remains relatively muted. This is reflected in recent high frequency indicators with Eurostat’s preliminary flash estimates for the third quarter pointing to EU growth of 0.3 per cent.
Overall, the IMF project growth to rebound to 1.1 per cent in the EU this year, as inflation continues to decline, services activity is strong, and trade has rebound. However, the large dispersion in growth rates across member states is expected to continue, with forecasts ranging from 5 per cent in Malta to a 0.9 per cent contraction in Estonia.
The IMF expect economic activity in Ireland to shrink by 0.2 per cent in 2024. As GDP is an unreliable indicator in an Irish context, MDD and consumer spending as well as labour market conditions outlined above provide a better insight into the domestic economy.
Notwithstanding these positive developments, there of course remains uncertainty surrounding the growth outlook. Risks to the near-term outlook are two-sided. On the domestic side, demand could be stronger-than-assumed which could result in overheating pressures. On the external side, developments in the global economy remain a key source of risk to the Irish growth outlook. The most pressing risks are the potential for weaker global demand, or slowdowns in global trade. These affect Ireland in particular due to the concentrated nature of the multinational sector.
In this context, it remains important to monitor developments, to ensure the sustainability of the public finances, and to deliver structural reforms to improve our competitiveness and boost productivity.
Departmental Priorities
Questions (56)
Bernard Durkan
Question:56. Deputy Bernard J. Durkan asked the Minister for Finance to outline his proposals to address the important issues now arising and likely to present a challenge in the future to family households and the productive/caring sectors as required and necessary; and if he will make a statement on the matter. [45467/24]
View answerWritten answers
The Irish economy is in relatively good shape at an aggregate level, reflecting the easing in inflationary pressures, the solid growth in the domestic economy and strength of the labour market.
The brightest spot in the Irish economy has undoubtedly been the labour market, with over 2.75 million people in employment in the second quarter of 2024. The unemployment rate is also expected to remain low by historical standards and consistent with full employment.
Cost of living pressures which had weighed heavily on households and businesses over recent years have now eased significantly. Indeed, the inflation rate in Ireland has been at or below 2 per cent since March 2024.
However, even as the headline rate of inflation has declined, I am acutely aware that many are still struggling as price levels throughout the economy remain elevated. That is why Budget 2025 includes a cost of living package, designed to support the most vulnerable and ease the financial burden over the winter months.
Budget 2025 included a personal income tax package amounting to just under €1.6 billion in 2025 and €1.8 billion in a full year and builds on the significant progress made over the lifetime of this Government. The package was built around 3 key pillars: changes to tax credits, the standard rate band and Universal Social Charge (USC). The tax package was designed in a manner which allowed the Government to use these levers to distribute the benefit of the package as effectively as possible. For the fourth year in a row, the main tax credits and the Standard Rate Cut-Off Point were increased.
The package also had a particular focus on Carers, and tackling child poverty by providing a suite of tax enhancements to support and assist such individuals and families. The Home Carer Tax Credit, Single Person Child Carer Credit and the Incapacitated Child Tax Credit were all increased. In addition, the Dependent Relative Tax Credit and the Blind Person’s Tax Credit were increased.
Furthermore, the 4 per cent rate of USC was reduced to 3 per cent and the ceiling of the band for the 2 per cent rate of USC was increased to €27,382 (from €25,760) in line with an increase in the National Minimum Wage.
Looking ahead, real income growth should support a continued expansion of consumer spending this year and next. Indeed, consumer spending is expected to act as the primary driver of growth in the domestic economy. My Department now forecasts Modified Domestic Demand (MDD), the preferred measure for the domestic economy, to grow by 2.6 per cent for this year and 2.9 per cent next year.