Robert Troy
Ceist:301. Deputy Robert Troy asked the Minister for Finance if he will review the qualifying criteria for a primary medical certificate. [32452/24]
Amharc ar fhreagraPrimary Medical Certificates
Ceisteanna (301)
Freagraí scríofa
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 next National Disability Strategy is currently under development, which will be a whole-of-government strategy that will advance the implementation of the United Nations Convention on the Rights of Persons with Disabilities. Transport has been identified as a strong point of focus and is intended to be a pillar therein.
Under the aegis of the Department of Taoiseach officials from relevant Departments and agencies are meeting to discuss the issues arising from the NDIS report including how the DDS can be replaced.
The Department of Finance submitted a note to the group with my predecessor's approval in mid-January 2024. This note outlines a proposal for a replacement scheme for the DDS which would be a needs-based, grant-led approach for necessary vehicle adaptations. Further consideration is being given to this matter through the establishment of sub-group of the Department of Taoiseach working group. This sub-group met in July 2024 and is expected to report in the Autumn.
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.
Tax Yield
Ceisteanna (302)
Pearse Doherty
Ceist:302. Deputy Pearse Doherty asked the Minister for Finance the revenue raised in first-and full-year terms in each of the years 2025, 2026, 2027, 2028 and 2029, respectively, from increasing the rate of residential stamp duty from 1 to 2% for residential property of values between €700,000 and €1 million, and increasing the rate of residential stamp duty from 2 to 5% for residential property of values above €1 million. [33150/24]
Amharc ar fhreagraFreagraí scríofa
I am advised by Revenue that the estimated yield that would be generated by increasing the rate of residential stamp duty from 1% to 2% for residential property of values between €700,000 and €1 million and increasing the rate of residential stamp duty from 2% to 5% for residential property of values above €1 million is published on page 18 of the Ready Reckoner, available on the Revenue website at: www.revenue.ie/en/corporate/documents/statistics/ready-reckoner.pdf. The combined annual yield from both measures is estimated to be €110 million.
However, Ready Reckoner estimates do not take account of any potential change in behaviour by the taxpayers concerned in response to changes in the tax rate.
In addition, the Deputy will wish to note that an update of the Ready Reckoner is due to issue in the coming weeks.
I am further advised that Revenue cannot provide estimates for later years due to the unknown nature of the future tax base and future economic behaviour.
Tax Credits
Ceisteanna (303)
Richard Boyd Barrett
Ceist:303. Deputy Richard Boyd Barrett asked the Minister for Finance the estimated cost of index linking tax credits. [33265/24]
Amharc ar fhreagraFreagraí scríofa
As the Deputy will be aware, the Programme for Government, “Our Shared Future”, states that “From Budget 2022 onwards, in the event that incomes are again rising as the economy recovers, credits and bands will be index linked to earnings. This will be done to prevent an increase in the real burden of income tax, to prevent more low income workers being taken into the tax net because of no changes to the tax system and to ensure there is no increase in the number of people having to pay higher income tax and USC rates.”
In relation to the Deputy’s request, I would point out that, page 9 of Revenue’s Post-Budget 2024 Ready Reckoner (dated October 2023) includes the estimated cost of indexation at 1 percent, across the main tax credits and bands, as well as USC band rates and exemption limits. This information is available at the following link –
www.revenue.ie/en/corporate/documents/statistics/ready-reckoner.pdf.
An update of the Ready Reckoner is due to issue in the coming weeks.
Based on Revenue’s latest Ready Reckoner (Post-Budget 2024), it is estimated that the cost of indexing only the income tax credits by 1 percentage point would be in the region of €105 million in 2025 and €120 million in a full year.
Financial Services
Ceisteanna (304)
Rose Conway-Walsh
Ceist:304. Deputy Rose Conway-Walsh asked the Minister for Finance the effect Micro Finance Ireland and Strategic Banking Corporation of Ireland lending have on both net expenditure, expenditure ceilings, and general Government expenditure, in tabular form; and if he will make a statement on the matter. [33377/24]
Amharc ar fhreagraFreagraí scríofa
The CSO Register of Public Sector Bodies sets out the background and methodology applied to the classification of the general government sector. As set out in the Register, Microfinance Ireland (MFI) and the Strategic Banking Corporation of Ireland (SBCI) are classified as non-commercial entities within the general government sector. Therefore, the expenditure of these entities are included in general government expenditure. Lending by these entities is classified as a financial transaction on the general government balance sheet and therefore has no impact on general government expenditure.
In relation to the effect of MFI and SBCI lending on Departmental expenditure ceilings, the lending itself does not have any direct impact. However, allocations provided to cover inter alia grants, administrative costs and a first loss provision to meet the cost of loan defaults are incorporated in Departmental expenditure ceilings. In the case of certain schemes, a state guarantee was provided to the participating lender in the event of a borrower defaulting on the repayments. Claims paid on this basis would also be incorporated in Departmental expenditure ceilings.
In addition, under certain schemes, borrowers pay a premium for availing of the scheme. The premia income are submitted to Appropriations in Aid.
The amounts paid to SBCI and the impact on Departmental net expenditure is a matter for the Department of Enterprise, Trade and Employment, the Department of Agriculture, Food and the Marine and the Department of Environment, Climate and Communications. The amounts paid to MFI are a matter for the Department of Enterprise, Trade and Employment.
International Programmes
Ceisteanna (305)
Michael Fitzmaurice
Ceist:305. Deputy Michael Fitzmaurice asked the Minister for Finance for an update on the implementation of the 2022 International Monetary Fund Financial Sector Assessment Programme; and if he will make a statement on the matter. [30912/24]
Amharc ar fhreagraFreagraí scríofa
As the Deputy will be aware, Ireland's most recent IMF Financial Sector Assessment Programme took place in 2022, resulting in 19 recommendations for the Irish authorities to take forward.
An update on the implementation of the 2022 FSAP was most recently published in December 2023 as part of Ireland’s 2023 Article IV Consultation. The report can be found on the IMF website at the following location: https://www.imf.org/en/Publications/CR/Issues/2023/12/14/Ireland-2023-Article-IV-Consultation-Press-Release-and-Staff-Report-542470
As noted in the IMF report, the Irish Authorities either have completed or are on track to address the key recommendations of the 2022 FSAP. Annex II of the report outlines the progress made on each of the 19 key recommendations.
Officials are continuing to implement these recommendations. A further update on the on the status of implementation of the recommendations will form part of Ireland’s 2024 Article IV Consultation later this year, and is expected to be published following the conclusion of that consultation.
Tax Code
Ceisteanna (306)
Michael Fitzmaurice
Ceist:306. Deputy Michael Fitzmaurice asked the Minister for Finance his views on setting both the credit union stabilisation fund levy and credit institution resolution fund levy at 0% for 2025; and if he will make a statement on the matter. [30913/24]
Amharc ar fhreagraFreagraí scríofa
The Credit Institutions Resolution Fund (the Resolution Fund) and the Credit Union Stabilisation Fund (the Stabilisation Fund) are currently the subject of ongoing reviews. Consultation papers on both funds were issued to stakeholders on Friday 12 July 2024. These consultations are on foot of a request in September 2023 by my predecessor that the Department complete a comprehensive review of both the Credit Union Resolution and Stabilisation funds.
Stakeholders selected to participate in these consultations include the following: the Central Bank of Ireland, the Irish League of Credit Unions (“ILCU”), the Credit Union Development Association (“CUDA”), the Credit Union Managers Association (“CUMA”), the National Supervisors Forum (“NSF”) and a random selection of 20 credit unions operating in the Republic of Ireland as at 26 April 2024. The consultation papers are also published on the Departmental website and any credit union not randomly selected is also free to make a submission to these consultations, if they so choose to do so.
The consultation will remain open to 27 September 2024 giving stakeholders ample time to develop their responses. It is my hope that a broad range of the sector will take the time to input into these reviews.
When the consultation process is complete, the Department of Finance will review feedback received before issuing feedback statements to these consultations. The feedback received will play an important part in informing the Department of Finance’s recommendations to myself as Minister for Finance on the future of both the Resolution Fund and Stabilisation Fund.
The 2025 Resolution Levy must be made before 1 October 2024. As such, the 2025 Resolution Levy will be set before the completion of the review of the Resolution Fund. The Resolution Fund has a current target size of €65 million to be met by 2025. The Department will work with the Central Bank over the coming weeks (and complete the necessary statutory consultations) to assess the level of the Resolution levy to be collected in 2025. Once I reviewed the necessary information, I will make a decision on the 2025 Resolution Levy rate.
As the review of the Resolution Fund will be published after the 2025 Levy is set, recommendations made will relate to the future of the Fund (i.e. target size, levy collections) post-2025.
The 2025 Stabilisation Levy must be made before 1 January 2025. As such, it is expected that the review of the Stabilisation Fund will be completed before the 2025 Stabilisation levy is signed. The output of this review will assist in determining the level at which the 2025 Stabilisation Levy is set.
Credit Unions
Ceisteanna (307)
Michael Fitzmaurice
Ceist:307. Deputy Michael Fitzmaurice asked the Minister for Finance the amount and average value of mortgages outstanding by credit unions at end March 2023 and end March 2024; and if he will make a statement on the matter. [30914/24]
Amharc ar fhreagraFreagraí scríofa
At the end of March 2024, the total amount of house loans outstanding, reported by credit unions in prudential returns submitted to the Central Bank, was €614.9 million. At the end of March 2023, the total amount of house loans outstanding reported was €364.9 million.
For credit unions reporting house loans, the average house loan was €115,844 at 31 March 2024, an increase on the average house loan size of €92,825 as at 31 March 2023.
As defined in the 2016 Regulations (S.I. No. 1 of 2016), “house loan” means a loan made to a member secured by property for the purpose of enabling the member to:
(a) have a house constructed on the property as their principal residence;
(b) improve or renovate a house on the property that is already used as their principal residence,
(c) buy a house that is already constructed on the property for use as their principal residence, or
(d) refinance a loan previously provided for one of the purposes specified in (a), (b) or (c) for the same purpose;
Credit Unions
Ceisteanna (308)
Michael Fitzmaurice
Ceist:308. Deputy Michael Fitzmaurice asked the Minister for Finance the amount and average value of business lending outstanding by credit unions at end March 2023 and end March 2024; and if he will make a statement on the matter. [30915/24]
Amharc ar fhreagraFreagraí scríofa
At the end of March 2024, the total amount of business loans outstanding, reported by credit unions in prudential returns submitted to the Central Bank, was €173.76 million. At the end of March 2023, the total amount of business loans reported was €151.45 million.
For credit unions reporting business loans, the average business loan was €22,744 at 31 March 2024, an increase on the average business loan size of €20,764 as at 31 March 2023.
For the purposes of the 2016 Regulations, “business loan” means a loan other than a community loan, that is made to-
(a) a member of the credit union that is an approved housing body, or
(b) a member, or where there is more than one member, at least one of those members, that satisfies the following conditions:
(i) the loan is made for purposes of the person’s trade, business or profession;
(ii) the person is a micro, small or medium-sized enterprise within the meaning of Commission Recommendation 2003/361/EC;
(iii) the loan is not made for the purpose of financing, in whole or in part, the purchase, construction or refinancing of buildings or the purchase or refinancing of land that the person intends to rent to a third party in order to generate income.
“Commission Recommendation 2003/361/EC” means the Commission Recommendation of 6 May 2003 concerning the definition of micro, small and medium-sized enterprises.
Credit Unions
Ceisteanna (309)
Michael Fitzmaurice
Ceist:309. Deputy Michael Fitzmaurice asked the Minister for Finance his views on the appropriateness of the requirement for credit unions to require a business plan to be developed before business loans above €25,000 can be issued as per regulation 16(3) of Central Bank Statutory Instrument 1 of 2016; and if he will make a statement on the matter. [30916/24]
Amharc ar fhreagraFreagraí scríofa
The Credit Union Act 1997 (the 1997 Act) sets out provisions in relation to credit union lending and provides the Central Bank with regulation-making powers in relation to lending.
In making regulations under the 1997 Act, the Central Bank must have regard to the need to ensure that the requirements imposed by the regulations are effective and proportionate having regard to the nature, scale and complexity of credit unions, or the category or categories of credit unions, to which the regulations will apply.
Section 35(2) of the 1997 Act provides that ‘A credit union may make a loan to a member for such purpose as the credit union considers appropriate, upon such security (or without security) and terms as the rules of the credit union may provide. The ability of the loan applicant to repay shall be the primary consideration in the underwriting process of the credit union’.
In relation to business loans, where the total amount of business loans granted to a borrower, or group of borrowers who are connected, is €25,000 or more, the Credit Union Act 1997 (Regulatory Requirements) Regulations 2016 (the 2016 Regulations) require that "A credit union shall only grant a business loan, a community loan, or a loan to another credit union where a comprehensive business plan and detailed financial projections (supported by evidence-based assumptions), appropriate for the scale and complexity of the loan, have been provided to it before it grants the relevant loan." The assessment of a business plan should enable the credit union to be satisfied that the borrowing business has the capacity to generate sufficient income to repay the loan.
This Regulation "does not apply to a business loan granted by a credit union where the total amount of business loans granted to a borrower, or group of borrowers who are connected, is less than €25,000.”
In November 2019, following a review and public consultation – Consultation on Potential Changes to the Lending Framework for Credit Unions, CP125 - the Central Bank issued a Feedback Statement and Amending Regulations setting out new lending measures for credit unions.
The Amending Regulations came into effect on 1 January 2020 and did not make any changes to the requirement in the 2016 Regulations relating to business plans and detailed financial projections. In the Feedback Statement on CP125, the Central Bank clarified that its expectation is that more comprehensive business plans and detailed financial projections are sought by credit unions for more complex and larger scale loans.
In the same Feedback Statement, the Central Bank committed ‘to perform and publish an analysis of credit union sector lending three years post-commencement of the amending regulations in order to assess and analyse the actual impact which the changes to the lending regulations have had and to inform any decisions on the need for future change’. The Central Bank commenced this review in Q4 2023, with an initial analysis expected in H2 2024.
I am aware that Minister Richmond, Minister of State with responsibility for credit unions has engaged with many credit union stakeholders regarding lending limits, the requirement for business plans for loans above 25,000, and other issues facing the sector. I understand that Minister Richmond has engaged with the Central Bank on this issue and the Central Bank are reviewing this, and other aspects of the Regulation. As the Deputy is aware, the Central Bank is completely independent of Government and makes regulation to safeguard credit union members' funds.
Credit Unions
Ceisteanna (310)
Michael Fitzmaurice
Ceist:310. Deputy Michael Fitzmaurice asked the Minister for Finance the number of volunteer directors working on credit union boards of directors; and if he will make a statement on the matter. [30917/24]
Amharc ar fhreagraFreagraí scríofa
Each credit union has a volunteer board of directors (board) that is directly elected by its members. Generally speaking, the board is responsible for the general control, direction and management of the credit union.
Sections 53-57 of the 1997 Act set out the relevant legislative provisions relating to the directors of credit unions. In accordance with section 53, other than in limited circumstances, the number of directors must be specified in a credit union’s registered rules and must be no less than 7, no more than 11, and an odd number.
As at 18 July 2024, based on Annual Return data submitted by individual credit unions to the Central Bank, there were c.1,800 directors across the credit union sector, across 188 credit unions.
Each credit union submits an Annual Return to the Central Bank by 31 March latest each year - this return includes a listing of directors serving in the credit union as at the completion date of the Annual Return.
Budget 2025
Ceisteanna (311)
Pádraig O'Sullivan
Ceist:311. Deputy Pádraig O'Sullivan asked the Minister for Finance if he will consider tax measures to help the hospitality sector in Budget 2025; and if he will make a statement on the matter. [30998/24]
Amharc ar fhreagraFreagraí scríofa
As the Deputy will be aware, it is a longstanding practice of the Minister for Finance not to comment, in advance of the Budget, on any tax matters that might be the subject of Budget decisions.
Financial Services
Ceisteanna (312)
Robert Troy
Ceist:312. Deputy Robert Troy asked the Minister for Finance the reason the credit union will allow a client to hold up to €30,000 on deposit when the ceiling with regard to probate is €27,000; his views on whether these figures should be brought in line; and if he will ensure that deposit holders in financial institutions are made aware, through the relevant institution, of the rules regarding levels of deposit before probate is applied. [31070/24]
Amharc ar fhreagraFreagraí scríofa
I thank the Deputy for his question.
Just to inform the Deputy, there is a cap of €100,000, not €30,000 on member savings, as outlined in Regulation 35 of the Credit Union Act 1997 (Regulatory Requirements) 2016.
A number of credit unions were approved to retain individual member savings in excess of €100,000 that were held on commencement of the regulations under Regulation 36(2). Additionally, under Regulation 37, some credit unions with assets in excess of €100 million were approved to increase individual member savings in excess of €100,000. As the Deputy is aware, the Central Bank of Ireland makes all of its regulations independent of Government.
Individual credit unions make independent decisions to limit the amount of savings they accept from their members to less than €100,000, for example, a limit of €30,000 as per your question. This is a decision for the respective board of each independent credit union.
Under Section 21 of the Credit Union Act 1997 (an amended by the Credit Union Amendment Act 2023) , a Credit Union member is entitled to nominate a person to be the beneficiary of their savings following their death up to a limit of €27,000. This is a unique provision for credit union members.
Any amount in excess of €27,000 are deemed assets of the deceased's estate and credit unions are obliged to administer any such funds in accordance with the rules of probate (if there is a will), or the law of succession (if there is no will). The probate office of the High Court deals with all matters relating to rules of probate.
To summarise, the amount of savings a credit union member deposits and the nomination cap are separate and distinct provisions.
Nomination is an exclusive provision, specifically designed for credit union members, allowing the designated individual to access up to €27,000 from the deceased member’s funds, bypassing potentially lengthy legal processes.
It would not be suitable for me to provide further commentary on a credit union savings cap or any independent decisions made by credit union boards.
I trust this clarifies matters for the Deputy.
Tax Reliefs
Ceisteanna (313)
Niamh Smyth
Ceist:313. Deputy Niamh Smyth asked the Minister for Finance the number of people from all counties, including Cavan and Monaghan, who have to date availed of the mortgage relief scheme, as announced in Budget 2024, in tabular form; and if he will make a statement on the matter. [31160/24]
Amharc ar fhreagraFreagraí scríofa
Mortgage Interest Tax Relief is a one-year temporary relief, which is available to taxpayers in respect of their principal private residence in the State where the outstanding mortgage balance was between €80,000 and €500,000 as of 31 December 2022. The relief also extends to a qualifying property located in the State, which is the sole or main residence of the individual’s former or separated spouse or civil partner or a dependent relative.
The tax relief is at the standard rate of income tax and is based on the increase in interest paid in 2023 over interest paid in 2022. The value of the relief will be equal to the lesser of 20 per cent of this excess interest figure, or €1,250. This means that the maximum tax relief will be €1,250 per property.
Where the interest payments made in respect of either the 2022 or 2023 tax years are not for a full year, pro-rating of the relief will apply, to ensure interest is applied on a period of equivalence basis and that the cap is adjusted accordingly. Revenue’s systems will carry out the calculation of the relief at the point of claim.
In order to avail of the relief, the taxpayer must file a 2023 Income Tax Return and upload certificates of mortgage interest for both 2022 and 2023, together with confirmation of their mortgage balance as of 31 December 2022. Furthermore, the taxpayer must be compliant with Local Property Tax requirements and must have paid income tax in 2023. The relief operates by way of a credit offset against a taxpayer’s income tax liability for 2023.
I am advised by Revenue that as of 3 July 2024, 23,339 PAYE taxpayer units made a claim for this credit on their 2023 PAYE income tax return, and 20,530 claimants received a refund of tax, which may also include a refund in respect of other credits and reliefs, such as health expenses. Of these, 266 claimants received a partial refund as the tax paid was less than that claimed. A further 2,523 claimants are either in a balanced position or had an underpayment of tax reduced. An additional 286 claimants are not in a position to benefit as they did not pay any Income Tax in 2023.
Information is not yet available for self-assessed taxpayers as these taxpayers have until 31 October 2024 to submit their 2023 Income Tax Return.
Revenue have provided a county-by-county breakdown of all claims made below.
|
County |
No. of Taxpayer Units |
|
CARLOW |
318 |
|
CAVAN |
319 |
|
CLARE |
497 |
|
CORK |
2,529 |
|
DONEGAL |
406 |
|
DUBLIN |
7,038 |
|
GALWAY |
976 |
|
KERRY |
403 |
|
KILDARE |
1,730 |
|
KILKENNY |
451 |
|
LAOIS |
482 |
|
LEITRIM |
103 |
|
LIMERICK |
861 |
|
LONGFORD |
141 |
|
LOUTH |
804 |
|
MAYO |
340 |
|
MEATH |
1,701 |
|
MONAGHAN |
204 |
|
OFFALY |
371 |
|
ROSCOMMON |
181 |
|
SLIGO |
206 |
|
TIPPERARY |
640 |
|
WATERFORD |
690 |
|
WESTMEATH |
326 |
|
WEXFORD |
725 |
|
WICKLOW |
897 |
|
Total |
23,339 |
Tax Exemptions
Ceisteanna (314)
Alan Dillon
Ceist:314. Deputy Alan Dillon asked the Minister for Finance if he will consider increasing the tax exemption limits for people aged 65 years; if he will revert to 2011 tax exemption figures; and if he will make a statement on the matter. [31318/24]
Amharc ar fhreagraFreagraí scríofa
As the Deputy will be aware, the age exemption applies for any year of assessment where an individual is aged 65 years or over and his or her total income does not exceed €18,000 per annum. Where an individual is a married person or civil partner and is jointly assessed to tax, the age exemption will apply where either individual is aged 65 or over and where the couple’s total income does not exceed €36,000 per annum. The relevant income thresholds may be increased further if the individual has a qualifying child. The thresholds are increased by €575 in respect of both the first and second child, and €830 in respect of each subsequent child.
It is important to note that marginal relief may be available where the individual’s or couple’s income exceeds the relevant exemption limit but is less than twice that amount. Where marginal relief applies the individual or couple is taxed at 40 per cent on all income above the exemption limit to a ceiling of twice the exemption limit. The system of marginal relief ensures that in cases where an individual's or couple’s income rises above the exemption threshold that their net income will not decline, as the 40 per cent income tax rate only applies to the proportion of income above the threshold. Once the income exceeds twice the exemption limit marginal relief is no longer available and the individual pays tax under the normal tax system.
It should be noted, however, that where the individual’s income is greater than the exemption limit but below twice that limit, the taxpayer is entitled to the benefit of the more favourable treatment as between the use of marginal relief or the normal tax system of credits and bands.
I have no plans to increase the age exemption limits. However, it should be noted that in circumstances where the individual or couple no longer benefits from the age exemption or marginal relief, they will benefit from the increases to the main personal tax credits in recent Budgets.
For example, the increases to the main personal tax credits in Budget 2024 (€100 increase to the single, employee and earned income credits and a €200 increase to the credit for married couples / civil partnerships) means that the effective entry point to income tax has increased for all taxpayers, including those aged over 65. From 2024, the effective entry point to income tax for an individual in receipt of the single person credit, employee / earned income credit and the age credit has increased by €1,000 per annum from €18,975 to €19,975 per annum.
It is important to take into account that the current tax arrangements for persons aged 65 or older compare favourably with the tax treatment of the generality of taxpayers. For example, persons aged 65 or over may also avail of the age tax credit, which currently amounts to €245 per year for single persons or €490 per year for married couples or civil partners. Reduced rates of USC also apply for persons aged 70 or older where their total income is €60,000 or less per annum. In addition, it is important to point out that social welfare income such as the State Contributory Pension and State Non-Contributory Pension are excluded from the calculation when determining if an individual’s income has exceeded the €60,000 income threshold. Furthermore, the State Contributory Pension and the State Non-Contributory Pension are not chargeable to USC or Pay Related Social Insurance.
It should also be noted that the Commission on Taxation and Welfare recommended that age should be removed as a factor for determining the charge to income tax and USC. The report stated that the determination of an individual’s tax treatment based on age narrows the base and breaches the concept of horizontal equity, whereby those with similar income should pay the same proportion of that income in taxes. It also breaches the concept of intergenerational equity. Further details are set out in the Report of the Commission, located at the following link -
www.gov.ie/en/publication/7fbeb-report-of-the-commission/ .
Finally, as part of the Personal Tax Review published on Budget Day, my Department set out further analysis of the recommendations of the Commission on Taxation and Welfare, including in respect of the age exemption limits. The Report is available at the following link -
www.gov.ie/pdf/?file=https://assets.gov.ie/273335/96f70eb1-64e1-4f02-9096-e36f306a048b.pdf#page=null .
Departmental Legal Cases
Ceisteanna (315)
Patrick Costello
Ceist:315. Deputy Patrick Costello asked the Minister for Finance the number of legal cases taken by his Department, or by agencies or bodies under his Department’s aegis, against another Department, Government agency or State body in each of the past five years; and if he will make a statement on the matter. [31363/24]
Amharc ar fhreagraFreagraí scríofa
I wish to advise the Deputy that neither my Department nor the bodies under the aegis of my Department have taken legal cases against another Department, Government agency or State body in the timeframe specified.
Departmental Staff
Ceisteanna (316)
Sorca Clarke
Ceist:316. Deputy Sorca Clarke asked the Minister for Finance the number of WTE economists, by grade, in his Department in 2023 and to date in 2024, in tabular form. [31424/24]
Amharc ar fhreagraFreagraí scríofa
I wish to inform the Deputy that the Economics Division of my Department comprises the following staff at Administrative Officer, Assistant Principal Officer, Principal Officer and Specialist grades, headed by the Chief Economist at Assistant Secretary Level.
|
- |
Number of Staff in 2023 |
Number of Staff in 2024 |
|
Administrative Officer |
15 |
20 |
|
Assistant Principal |
12 |
14 |
|
Principal Officer |
5 |
5 |
|
Specialist |
3 |
3 |
These technical roles are supported by 3 administrative staff members to date in 2024 and 2 administrative staff members in 2023. In addition, staff members across the Department entered the Civil Service via the IGEES stream or possess economics qualifications.
Prize Bonds
Ceisteanna (317)
Michael Lowry
Ceist:317. Deputy Michael Lowry asked the Minister for Finance if the case of a prize bond will be examined (details supplied); and if he will make a statement on the matter. [31484/24]
Amharc ar fhreagraFreagraí scríofa
The NTMA has advised me that there were some complexities regarding the original holder address and the Prize bond number, but these have now been resolved.
The Prize Bond Company will be in direct contact with the customer to verify current personal details relating to the holding in question and I trust that the query will be resolved to the satisfaction of all concerned.
Budget 2025
Ceisteanna (318)
Robert Troy
Ceist:318. Deputy Robert Troy asked the Minister for Finance if he plans to scrap USC as part of Budget 2025, and in particular, if he will examine the case of retired teachers, who only receive a Department of Education pension but still have to pay USC. [31541/24]
Amharc ar fhreagraFreagraí scríofa
The Universal Social Charge (USC) was designed and incorporated into the Irish taxation system in 2011 to replace two other charges, namely the Health and Income Levies. The primary purpose of the USC 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.
It is important to point out that 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. €5.4 billion in 2023, and a projected yield of €5.6 billion is expected in 2024. If USC were to be abolished, it would be necessary to raise this amount from other sources.
Currently individuals with incomes of less than €13,000 per annum are exempt from USC, which can include modest occupational pensions. For 2024, it is estimated that 37 per cent of all taxpayer units will be exempt from USC.
The USC like the income levy before it, does not apply to social welfare payments, such as the contributory and non-contributory State pensions. However, a retired public servant in receipt of an occupational pension, is liable to the USC if their payment is greater than the annual exemption threshold. It also worth pointing out that persons aged 70 or older can benefit from a reduced rate of USC where their total income is €60,000 per annum or less.
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 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.
Tax Code
Ceisteanna (319)
Steven Matthews
Ceist:319. Deputy Steven Matthews asked the Minister for Finance the status of the review of deposit interest retention tax and its related exemptions and conditions; when this was completed; if a further review is proposed; and if he will make a statement on the matter. [31606/24]
Amharc ar fhreagraFreagraí scríofa
The Deputy will be aware that Deposit Interest Retention Tax (DIRT) is deducted at source by deposit takers (e.g. banks, building societies, credit unions, An Post, etc.) from interest paid or credited on deposits of Irish residents. DIRT is currently charged at 33%. DIRT has been considered in a number of reviews.
In 2018, my Department carried out a review of the taxation of DIRT and Life Assurance Exit Tax (available at: assets.gov.ie/5082/201218111955-d71b3530135c4ed8b556f4dcba3f7e50.pdf ). A further review was again undertaken in the 2020 TSG paper (www.gov.ie/pdf/?file=https://assets.gov.ie/87003/0bd8793d-3466-4870-8b57-70155844307d.pdf). These reviews, however, did not consider the exemptions from DIRT in detail.
Interest is exempted from DIRT in a number of circumstances, including where an account is held by an individual where the individual or his or her spouse or civil partner is aged 65 years or older, and his or her total income in a year (including interest earned) is below the relevant income tax annual age exemption limit.
The annual exemption limits are €18,000 in the case of a single person and €36,000 in the case of a married couple or civil partnership.
These exemption limits were recently considered as part of the Review of the Personal Tax System carried out by my Department last year. The review is available at www.gov.ie/pdf/?file=https://assets.gov.ie/273335/96f70eb1-64e1-4f02-9096-e36f306a048b.pdf#page=null.
No further review is currently proposed at this time.
As with all tax policy, DIRT and its exemptions will be kept under review throughout the annual budgetary and Finance Bill process.
Official Engagements
Ceisteanna (320)
Paul Donnelly
Ceist:320. Deputy Paul Donnelly asked the Minister for Finance if he has spoken with the new UK Chancellor of the Exchequer. [31638/24]
Amharc ar fhreagraFreagraí scríofa
There have been a number of contacts with Chancellor Reeves since her appointment earlier this month. Following a letter of congratulations which I sent to her, we spoke last week by phone and agreed to meet in London soon.
The bilateral economic and trading relationship between Ireland and Great Britain is of great importance to both countries - indeed Ireland is the UK's fourth-largest export destination and its tenth-largest source of imports. When we spoke last week, the Chancellor and I agreed that we would work together to play our full part in our governments' work to reset and renew British-Irish relations in the time ahead.
I look forward to our forthcoming meeting, which should provide an excellent opportunity to discuss matters of mutual interest, including the economic and fiscal outlook at national, regional and global levels; as well as opportunities and challenges which we face.