Written Answers Nos. 344-363
346. Deputy Pa Daly asked the Minister for Finance to outline the planned increases to the carbon tax over the next five years, per fuel, in tabular form; if halting the carbon tax increases was considered as part of the draft Programme for Government; and if he will make a statement on the matter. [1723/25]
View answerBudget 2010 announced the introduction of a carbon tax on fossil fuels in Ireland. Carbon taxation of petrol and auto-diesel came into effect in December 2009. It was extended to other liquid fuels and natural gas in 2010, and to solid fuels in 2013. Ireland’s carbon tax regime is a carbon pricing mechanism which directly links the taxation of fossil fuels to carbon dioxide emissions: a single price is set for a tonne of carbon dioxide, and this price is then applied as a tax to each fuel according to the level of carbon dioxide emitted by that fuel when it is combusted. In this way, the carbon tax applying to each fuel reflects the level of emissions that it causes when used.
The 2020 Programme for Government committed to increase the basis of carbon tax rates from €26 to €100 per tonne of carbon dioxide by 2030, and to use the additional revenue generated in specific expenditure programmes. Legislation was introduced in Finance Act 2020 to provide for annual carbon tax rate increases up to 2030: annual increases of €7.50 per tonne of carbon dioxide up to the final year increase of €6.50 meaning that carbon tax rates on all liable fuels will be based on charging €100 per tonne of carbon dioxide by May 2030.
There are three separate legislative frameworks within tax law to apply the carbon taxation regime across liquid fuels, natural gas and solid fuels.
Natural Gas Carbon Tax (NGCT) and Solid Fuel Carbon Tax (SFCT) rates are currently based on a charge of €56 per tonne of carbon dioxide emissions. This amount is legislated to increase to €63.50 on 1 May 2025 with further increases each May to 2030. Tables with current and future NGCT and SFCT rates, as provided for in legislation, are available in the Excise Duty Rates - Energy Products and Electricity Taxes Manual which is published on the Revenue website at www.revenue.ie/en/tax-professionals/tdm/excise/excise-duty-rates/energy-excise-duty-rates.pdf.
Carbon taxation of liquid fuels, and vehicle gas is applied as Mineral Oil Tax (MOT). MOT comprises a carbon and a non-carbon component. The carbon component is also referred to as carbon tax. MOT carbon component rates for petrol and auto-diesel, which are currently based on charging €63.50 per tonne of carbon dioxide, are legislated to increase each October up to and including 2029. Rates for other fuels liable to MOT (such as heating kerosene and Marked Gas Oil) are currently based on charging €56 per tonne of carbon dioxide. These rates are legislated to increase on 1 May 2025 and each May thereafter up to and including 2030. A table of current MOT rates, broken down into their carbon and non-carbon components, is available in the Excise Duty Rates - Energy Products and Electricity Taxes Manual available at www.revenue.ie/en/tax-professionals/tdm/excise/excise-duty-rates/energy-excise-duty-rates.pdf.
Inclusive of VAT, carbon tax rate increases, up to the final year of the trajectory, will annually add approximately 2.1 cents to a litre of petrol, 2.5 cents to auto-diesel, 2.2 cents to heating kerosene and 2.3 cents to Marked Gas Oil. I am advised by Revenue that a non-statutory consolidation of MOT law, which includes total MOT rates and MOT carbon component rates up to 2030 in tabular form, is published on the Revenue website at www.revenue.ie/en/companies-and-charities/documents/excise/legislation/mot-primary-law.pdf. Carbon tax rate increases as per Schedule 2a of Finance Act 2020 are published on page 40 of this document.
During Programme for Government negotiations, it was agreed to continue with the planned carbon tax increases, aligning with recommendations from the Climate Change Advisory Council and scientific experts, and to continue to use the additional revenues to fund social welfare measures, agri-environmental schemes and retrofitting.
This approach encourages a shift away from fossil fuels and ensures those who are most vulnerable receive targeted support, making the transition to a sustainable future fair and equitable.
347. Deputy James Geoghegan asked the Minister for Finance the full address and Eircode of each property that is directly occupied by his Department where that address is located in Dublin, in tabular form; and if he will make a statement on the matter. [1763/25]
View answerI assume the Deputy’s question relates to locations where my Department’s staff work.
In that regard please see the table below;
|
Building Address |
Eircode |
|
Government Buildings, Upper Merrion Street, Dublin 2 |
D02 R583 |
|
14-16 Merrion Street, Upper Merrion Street, Dublin 2 |
D02 K728 |
|
7-9 Merrion Row, Dublin 2 |
D02 V223 |
|
Floor 1, Block 1, Miesian Plaza, 50 - 58 Lower Baggot Street, Dublin 2 |
D02 XW14 |
348. Deputy Aidan Farrelly asked the Minister for Finance to provide a schedule of all foreign travel undertaken by him and his accompanying officials in 2023 and 2024, including flight, hotel, transfers and other miscellaneous costs. [1860/25]
View answerIt was not possible for my Department to provide the information sought in the time available. I will, however, make arrangements to provide the information to the Deputy as soon as possible.
349. Deputy Pa Daly asked the Minister for Finance if he would consider lowering the VAT rate for domestically and sustainably produced wood pellet products, firewood stove, pellet stove and pellet boilers. [2002/25]
View answerThe VAT rating of goods and services is subject to the requirements of EU VAT law, with which Irish VAT law must comply. In general, the EU VAT Directive provides that all goods and services are liable to VAT at the standard rate, unless they fall within categories of goods and services specified in Annex III of the VAT Directive, in respect of which Member States may apply a lower rate of VAT. Currently, Ireland has a standard rate of 23% and two reduced rates of 13.5% and 9%.
A reduced rate of 13.5% already applies to firewood and other solid fuels.
It should be noted that lower VAT rates cannot be applied to domestically produced renewable and sustainable fuel. In the application of VAT rates, the Directive does not provide discretion for Member States to consider the degree to which goods or services are sourced domestically or are sourced from other countries, nor does it allow different VAT rates to apply to goods depending on whether they are produced here or are brought into the State from elsewhere.
In accordance with EU law, Member States can decide to apply a reduced rate of VAT on “the supply and installation of highly efficient low emissions heating systems”, provided that the products meet the requirements of certain EU regulations concerning emissions and energy labelling.
Further to this provision in the Directive, in Budget 2025, I announced that, with effect from 1 January 2025, the 9% rate of VAT will apply to the supply and installation of heat pump heating systems.
The purchase of all other heating systems and of heating appliances continues to be subject to the standard rate of VAT, which is currently 23% in Ireland. However, where there is a contract for the “supply and installation” of a heating system, then, under VAT law, the “two-thirds rule” may apply. The two-thirds rule provides that if the cost of the goods used in carrying out the work does not exceed two-thirds of the total price, then the VAT rate which applies to the service is the rate that applies to the entire transaction. This means that, in such cases, the supply and installation would be subject to the 13.5% reduced rate of VAT, rather than the 23% standard rate.
Finally, the Deputy should note that as with other VAT rate reductions, while the VAT charged must always be correct a company can increase the base price of a product so that the final consumer does not benefit from the VAT reduction.
350. Deputy Jerry Buttimer asked the Minister for Finance if there is any plan to reform the current situation where tips are taxed in the hospitality sector as a temporary relief for employees and employers. [2023/25]
View answerIt is a general principle of taxation that, as far as possible, income from all sources should be subject to taxation. This is a well-established and broadly accepted principle.
Section 19 of the Taxes Consolidation Act (TCA) 1997, sets out that tax under Schedule E shall be charged in respect of every public office or employment of profit. Section 112 of the TCA 1997 brings into charge all salaries, fees, wages, perquisites or profits of any kind arising from an office or employment. Therefore, the long-standing position is that all tips, gratuities and service charges arising from an office or employment are chargeable to income tax under Schedule E in accordance with Section 112.
Gratuities from customers, for example service charges in hotels or tips in restaurants, paid to the employer and subsequently paid out to an employee should be included in pay for the income tax week or month in which they are paid out. These tips constitute pay for the purposes of the PAYE system. However, in a situation where an employee receives tips directly from customers, the employer is not obliged to operate PAYE and in that case, the tips and gratuities are fully taxable and should be included by the employee in his or her income tax return.
As you may be aware, the Payment of Wages (Amendment) (Tips and Gratuities) Act 2022 was enacted on 20 July 2022 and came into effect on 1 December 2022. The Act, which is under the remit of the Department of Enterprise, Trade and Employment, introduced new rules about how employers must share tips, gratuities, and service charges amongst employees. It also prohibits the practise of using tips or gratuities to top up wages/contractual rates of pay.
In addition, the legislation provides transparency to customers, as it requires businesses to clearly display their policy on how tips, gratuities and service charges are distributed. Further, any charge called a ‘service charge’ or anything that would lead a customer to believe it is a charge for service, has to be distributed to staff as if it were a tip or gratuity received by electronic means.
For the reasons I have outlined in my reply, I have no plans to amend the tax treatment of tips and gratuities.
351. Deputy Holly Cairns asked the Minister for Finance to provide details of any public contracts in his Department provided to companies or individuals who do not pay tax in Ireland, including the names of the contractor, value of the contract and purpose of the contract, in tabular form. [2034/25]
View answerThe principle of competitive tendering for Government contracts is used by my Department for the acquisition of goods and services. This is a requirement in accordance with the Directive on Public Procurement and the European Union (Award of Public Authority Contracts) Regulations 2016. Central to those procedures is the requirement to allow fair competition between suppliers through the submission of tenders following advertising of the tender competition on the eTenders site and on the Official Journal of the European Union, where appropriate. It is open to companies and individuals who are tax resident outside of Ireland to participate in tender competitions.
It is a condition of a contract award that successful tenderer(s) shall for the term of such contract(s), comply with all EU and domestic tax laws. My Department requires that successful tenderers supply a Tax Clearance Access Number and Tax reference Number to facilitate online verification of its tax status prior to making payment. However, this does not provide my Department with information as to the tax residency of suppliers.
Therefore, the information requested is not collated by my Department. I am unable to make any statement in relation to the matter.
352. Deputy Holly Cairns asked the Minister for Finance to provide details of any public contracts issued to a company (details supplied) over the last 10 years, including the value of the contract and the purpose of the contract, in tabular form. [2052/25]
View answerI can advise the Deputy that my Department does not have any record of contracts awarded by it to the companies mentioned in the details supplied over the last 10 years.
353. Deputy Barry Ward asked the Minister for Finance if he will consider providing tax deductibility at the lower rate for any person employing staff on a full-time basis, for whatever purpose but particularly for childcare, or other care, purposes; and if he will make a statement on the matter. [2074/25]
View answerI am advised by Revenue that there is tax relief available to individuals who have incurred costs in employing a person to take care of himself or herself, or a spouse or a relative in certain circumstances.
Section 467 of the Taxes Consolidation Act (“TCA”) 1997 provides for relief for employing a carer where the person being cared for is incapacitated by reason of physical or mental infirmity. The relief is available in respect of the costs incurred by an individual of employing another person, including a person whose services are provided by or through an agency, to take care of himself or herself, a spouse, or a relative, who, throughout the relevant tax year, is totally incapacitated by reason of physical or mental infirmity – subject to a maximum expenditure of €75,000 in the case of each incapacitated person. “Relative” in this context includes a relation by marriage and a person in respect of whom the individual is or was the legal guardian.
The tax relief, which is granted by reducing the individual’s taxable income, is allowed at the individual’s marginal rate of income tax (up to 40%) in respect of expenditure up to €75,000 in each case of an incapacitated person. Any amount recoverable from the HSE, or any other source, in respect of costs incurred in employing a carer, does not qualify for relief. Where two or more persons employ the carer, the allowance of €75,000 is apportioned.
Detailed guidance on tax relief for employing a carer can be found in Revenue’s Tax and Duty Manual Part 15-01-20, which can be accessed using the following link:
www.revenue.ie/en/tax-professionals/tdm/income-tax-capital-gains-tax-corporation-tax/part-15/15-01-20.pdf.
By way of background, where an individual directly employs a carer for an incapacitated individual as detailed above or employs someone in ‘domestic employment’, he or she has certain obligations as an employer under section 985 TCA 1997, including registering with Revenue as an employer and making the appropriate Income Tax, USC and PRSI deductions from the wages paid to the employee.
Where an individual directly employs someone in ‘domestic employment’, it is chargeable to income tax and USC and qualifies for the employee tax credit. The amount of tax due, if any, will depend on the circumstances of each case.
A ‘domestic employee’ is an individual, e.g., an Au Pair, who is employed by a domestic employer solely on domestic duties (including the minding of children) in the employer’s private dwelling house. The domestic employee may have other employments with different employers.
Under section 986(6) of TCA 1997, certain qualifying employers (‘domestic employers’) who employ an individual to provide domestic duties for a few hours a week are removed from this obligation to register as an employer.
A qualifying ‘domestic employer’ is one who:
• is an individual (organisations, companies, clubs etc. do not qualify),
• has only one domestic employee who is employed solely on domestic duties in the home, and
• pays less than €40 a week to that employee.
A domestic employer who:
• pays €40 or more a week to a domestic employee, or
• has more than one domestic employee concurrently,
must register as an employer and operate PAYE in the normal way.
Where the domestic employer is a qualifying domestic employer and is therefore not required to register as an employer, they are however, liable to pay employer’s PRSI at the rate of 0.5% (Class J). The domestic employer should register with the DSP at the commencement of the employment. The PRSI is payable by the employer in a single sum at the end of the tax year to the PRSI Special Collection Section of DSP.
Detailed information on the process to register as an employer for Pay As You Earn (“PAYE”) can be found on Revenue’s website using the following link:
www.revenue.ie/en/employing-people/becoming-an-employer-and-ongoing-obligations/registration-of-employers-for-paye-purposes/index.aspx#:~:text=If%20you%20hire%20an%20employee,ROS)%20before%20paying%20your%20employee.
For information on PRSI, please see leaflet SW14 - the Employers’ Guide to PRSI Contributions on the Department of Social Protection (“DSP”) website which can be found at the below link:
www.gov.ie/en/publication/d00d4-prsi-employer-guide/#prsi-contribution-rates-and-user-guide-sw14.
In regard to the introduction of any new measure proposals for tax expenditure measures are assessed in accordance with my Department's Tax Expenditure Guidelines. These make clear that any policy proposal which involves tax expenditures should only occur in limited circumstances where there are demonstrable market failures and where a tax-based incentive is more efficient than a direct expenditure intervention.
Furthermore, I must always be mindful of the public finances and the many demands on the Exchequer. Tax reliefs, no matter how worthwhile in themselves, lead to a narrowing of the tax base and a strong and convincing case for the benefits and outcomes needs to be articulated in order for due consideration to be given for the commitment of scarce taxpayer resources for such reliefs.
I have no plans at present for a new tax measure along the lines suggested by the Deputy.
354. Deputy Barry Ward asked the Minister for Finance if he will further increase the level at which liability for capital acquisitions tax accrues, specifically to return it to at least €500,000; and if he will make a statement on the matter. [2076/25]
View answerYou have clarified that you are referring to the Capital Acquisition Tax (CAT) Threshold A. CAT is a tax which applies to both gifts and inheritances. For CAT purposes, the relationship between the person giving a gift or inheritance (i.e. the disponer) and the person who receives it (i.e. the beneficiary) determines the maximum amount, known as the “Group threshold”, below which CAT does not arise.
In Budget 2025, the Group A threshold was increased from €335,000 to €400,000, Group B from €32,500 to €40,000 and Group C from €16,250 to €20,000.
You should be aware that there would be a significant cost in making further substantial changes to the CAT thresholds. The options available for setting CAT thresholds must be balanced against competing demands, and as part of the annual Budget and Finance Bill process.
355. Deputy Barry Ward asked the Minister for Finance if he will give consideration to varying the rate of capital acquisitions tax when it comes to residential property; and if he will make a statement on the matter. [2077/25]
View answerCapital Acquisition Tax (CAT) is a tax on gifts and inheritances. Individuals may receive gifts and inheritances up to a set threshold over their lifetime before having to pay CAT. Once due, it is charged at the rate of 33%. In Budget 2025, the Group A threshold was increased from €335,000 to €400,000, Group B from €32,500 to €40,000 and Group C from €16,250 to €20,000.
It is worth noting that there is an exemption from CAT where dwelling houses are bequeathed to individuals who:
• have lived there for a specified period of time before the inheritance,
• will continue to live there for a specified period of time after the inheritance, and
• who have no beneficial interest in any other residential property at the date of the inheritance.
The policy rationale behind the dwelling house exemption is to protect the family home by ensuring that a beneficiary who has been living with the disponer, and will continue to reside there after the inheritance, does not have to sell that family home to pay a CAT liability and thus will continue to have somewhere to live. It is not necessary for the beneficiary of an inheritance under the dwelling house exemption to be a child or relative of the disponer.
You should be aware that there would be a significant cost in making substantial changes to the rate of CAT. The options available for setting CAT rates and thresholds must be balanced against competing demands, and as part of the annual Budget and Finance Bill process.
356. Deputy Barry Ward asked the Minister for Finance his views on the elimination of the universal social charge, including a timeline; and if he will make a statement on the matter. [2078/25]
View answerThe USC was designed and incorporated into the Irish taxation system in 2011 to replace the Health and Income Levies. Its primary purpose was to widen the tax base and to provide a steady income to the Exchequer to provide funding for public services.
The USC is an individualised tax, meaning that a person’s liability to the tax is determined on the basis of a person’s own individual income and personal circumstances. It is a more sustainable charge than those it replaced and is applied at a low rate on a wide base, which ensures that it is a stable and sustainable source of revenue for the State.
In 2016 joint Department of Finance/Economic and Social Research Institute (ESRI) research found that USC represented a more stable form of revenue than income tax. The findings highlighted that USC revenues would fluctuate by less than income tax revenues whenever income is volatile, for example where the economy moves from a boom into a bust. Given the openness of the Irish economy and consequent susceptibility to economic shocks, the contribution that the USC makes to the stability of the State’s revenue sources is considerable.
The USC has played a vital role in meeting the many expenditure demands placed on the Exchequer. The USC yield was c. €5.7 billion in 2024, and a projected yield of €5.6 billion is expected in 2025. If USC were to be abolished, it would be necessary to raise this amount from other sources.
Currently individuals with income of less than €13,000 per annum are exempt from USC. In addition, USC does not apply to social welfare payments, such as the contributory and non-contributory State Pensions. For 2025, it is estimated that over 1.1 million taxpayer units (33 per cent of all taxpayer units) will be exempt from USC.
Ireland has one of the most progressive personal income tax systems in the world, which plays a crucial role in the process of income redistribution. Our redistributive tax system has been acknowledged by the IMF, the OECD and the ESRI. It is my view that a broad-based, progressive income tax system, where the majority of income earners make some contribution but according to their means, is the most fair and sustainable income tax system in the long term.
As such, I have no plans to abolish the USC.
357. Deputy John Connolly asked the Minister for Public Expenditure, National Development Plan Delivery and Reform if discussions with the respective landowner regarding the acquisition of a site, for the development of the Cleggan Coast Guard station have concluded; and if he will make a statement on the matter. [1509/25]
View answerThe Irish Coast Guard (IRCG), a Division of the Department of Transport, has 44 Units based in 58 Coast Guard Stations. The Coast Guard building programme, which includes the provision of new or upgraded facilities at a number of locations across the country, is managed by the Office of Public Works (OPW) on behalf of the Department of Transport, who fund the programme. The Cleggan Unit is a priority within the IRCG Building Programme.
The OPW identified a potentially suitable site in Cleggan for the IRCG and discussions with the landowner regarding the acquisition of this site are ongoing in light of of the land owners future plans for the development of the overall site.
Following any agreement on the transfer of land, the next steps require authorisation of funding by the Department of Transport, completion of the due diligence and acquisition of the preferred site. Once a suitable site is acquired, the OPW will assign a project team to commence the planning and detailed design stages of the project, subject to resources being available.
The Cleggan building project is part of a larger project pipeline that involves ongoing high-level collaboration between the OPW and the Department of Transport. This collaboration aims to continue building on the significant progress achieved to date and to ensure a strategic approach to the advancement of the Building Programme.
358. Deputy Michael Murphy asked the Minister for Public Expenditure, National Development Plan Delivery and Reform for an urgent update on the new Garda community headquarters for south Tipperary to be located in Clonmel (details supplied); the status of the tender process; if a contractor has been appointed; and the likely start date on this new facility. [1807/25]
View answerI wish to inform the Deputy that the tender assessment and evaluation stage for the Main Contractor is currently underway on the Clonmel Garda Station project by the Office of Public Works along with consultants appointed to work on the Clonmel Garda Station project. Once this is completed the OPW will proceed to the next stage of the process which is the assessment and evaluation of Reserved Specialist tenders.
359. Deputy Barry Ward asked the Minister for Public Expenditure, National Development Plan Delivery and Reform the status of the former Garda barracks building in Leenane, County Galway; and if he will make a statement on the matter. [1955/25]
View answerI am advised by the Commissioners of Public Works (OPW) that the former Garda station and residence in Leenane, Co. Galway is in private ownership.
The OPW have not had responsibility for the property since the 30th April 2021, following the sale of the property at a public auction.
360. Deputy Jerry Buttimer asked the Minister for Public Expenditure, National Development Plan Delivery and Reform to provide a report on the status of the progress of the upgrade and re-development of Bishopstown Garda station. [2017/25]
View answerI am informed by the Office of Public Works (OPW) that they have appointed a Design Team to develop an upgrade and redevelopment scheme for Bishopstown Garda Station. A sketch scheme has been signed off by Garda Estate Management. The Design Team are currently undertaking planning consultations with the Local Authority, with a view to submitting a planning application. Site investigations have been initiated to inform the detailed design thereafter.
The OPW are awaiting the National Transport Authority's latest design for a bus route which is proposed to run along the front boundary of Bishopstown Garda Station, and may influence the design of the site entrance. This information will be required for inclusion in the planning application.
The commencement/completion dates for the scheduled works are subject to the final sign off of operational and design requirements by An Garda Síochána and will be informed by planning approval, tendering and procurement processes.
361. Deputy Michael Fitzmaurice asked the Minister for Public Expenditure, National Development Plan Delivery and Reform the number of civil servants in his Department, and in agencies under the aegis of his Department, who were on career break in 2023 or 2024, by month and grade, and by length of career break; the number of civil servants in his/her Department and in agencies under the aegis of his Department who were on career break for longer than five years or longer than six years in 2023 or 2024, by month, grade, and length of career break, in tabular form; and if he will make a statement on the matter. [46196/24]
View answerThe information requested by the Deputy is set out in the tables below in respect of my Department and the bodies under its aegis. I am advised that the Office of Public Works will respond to the Deputy directly.
362. Deputy Michael Fitzmaurice asked the Minister for Public Expenditure, National Development Plan Delivery and Reform the number of vacancies, by month and by grade, in his Department, and in agencies under the aegis of his Department, in 2023 and 2024; and if he will make a statement on the matter. [46214/24]
View answerThe information requested by the Deputy in respect of my Department and the bodies under its aegis is set out in the tables below.
363. Deputy Michael Fitzmaurice asked the Minister for Public Expenditure, National Development Plan Delivery and Reform to provide an assurance that no civil servant has had their career break extended beyond five years where there is a suitable vacancy in their home Department or agency; that, where a civil servant has had their career break extended beyond five years on account of there being no suitable vacancy in their home Department or agency, that they have been placed on a redeployment panel; that, where a civil servant has had their career break extended beyond six years, consideration has been given to facilitating them on a supernumerary basis; and if he will make a statement on the matter. [46232/24]
View answerI wish to advise the Deputy that the Department of Public Expenditure, National Development Plan Delivery and Reform fully adheres to Circular 4/2013: Career Break Scheme in the Civil Service. The Department currently facilitates staff returning from career break as soon as they wish to return and has had no instances where a career break has been extended due to not having an appropriate vacancy.
