79. Deputy Louise O’Reilly asked the Minister for Finance the historical mechanisms used to hypothecate funding from a tax for specific purposes; the details of previous taxes or levies in tax history that have been ring-fenced for a specific purpose; and if he will make a statement on the matter. (Question 20546/18 asked on 10 May 2018 - Tax Code)

Minister for Finance (Deputy Paschal Donohoe): Hypothecation involves linking specific expenditure to an explicit revenue source and the Deputy will be aware that it is not a feature of the Irish tax system in general. It is only used in limited circumstances where there is a strong justification because it can cause difficulties for the efficient and effective management of the public finances. Furthermore, it also exposes specific expenditure dependent solely on a hypothecated revenue to any v...

119. Deputy Michael McGrath asked the Minister for Finance if sparkling water is included in the sugar sweetened drink tax; if his attention has been drawn to cases in which retailers have increased prices of soft drinks and sparkling water in advance of the tax introduction; and if he will make a statement on the matter. (Question 19737/18 asked on 08 May 2018 - Tax Code)

Minister for Finance (Deputy Paschal Donohoe): Sugar Sweetened Drinks Tax is provided for by Chapter 2 of Part 1 of the Finance Act 2017. The tax commenced on 1 May 2018 and applies to first supplies in the State of sugar sweetened drinks. Sugar sweetened drinks are water and juice based drinks, in ready to consume or concentrated form, that contain added sugar and have a total sugar content of 5 grams or more per 100 millilitres in their ready to consume form.
Sparkling water is not subject t...

123. Deputy Tom Neville asked the Minister for Finance the reason an incorrect tax certificate was issued to a person (details supplied). (Question 19927/18 asked on 08 May 2018 - Tax Code)

Minister for Finance (Deputy Paschal Donohoe): I am advised by Revenue that the tax position of the person in question has been examined and is correct.
Revenue has also confirmed that it has already been in direct contact with the person in regard to the issue, which seems to relate to payroll processing by their employer.
 ...

124. Deputy Eugene Murphy asked the Minister for Finance the reason a person (details supplied) who is newly employed by the Education and Training Board, ETB, is deemed exempt from the universal social charge, USC, in the last quarter of the person’s first year in employment in view of the fact the Revenue Commissioners is seeking to recoup the USC from the person in the following year causing financial hardship; and if he will make a statement on the matter. (Question 20032/18 asked on 08 May 2018 - Tax Code)

Minister for Finance (Deputy Paschal Donohoe): I am advised by Revenue that the person had an underpayment of Universal Social Charge for 2016. The underpayment arose because Revenue was not informed of the change in his employment circumstances. This resulted in his tax credits for the year being applied at previous years’ rates which were below the USC threshold.
Revenue originally advised the person that the shortfall would be collected by reducing his tax credits over the course of 2018. ...

208. Deputy Thomas P. Broughan asked the Minister for Finance if he will remove VAT and VRT from advanced driver assistance systems on new or older vehicles to incentivise the public to drive much safer vehicles and promote the Vision Zero policy of road safety; and if he will make a statement on the matter. (Question 15744/18 asked on 17 Apr 2018 - Tax Code)

Minister for Finance (Deputy Paschal Donohoe): I propose to take Questions Nos. 208 and 249 together.
I am advised by The Revenue Commissioners that the chargeable value for the calculation of Vehicle Registration Tax, the open market selling price (OMSP), is provided for in the Finance Act 1992, section 133. This section provides that the OMSP comprises the price, inclusive of all taxes, duties, enhancements or accessories, that a motor distributor might reasonably expect to fetch for a vehicl...

211. Deputy Aengus Ó Snodaigh asked the Minister for Finance if VAT charges will be removed from the rental of disability aids during the interim period when the person is awaiting the delivery or installation of same; the reason that when disability aids are purchased, they are exempted from VAT but VAT is charged when hiring disability aids; and his views on whether this charge should be removed or reimbursed to persons who had to await delivery and installation of the disability aid. (Question 16067/18 asked on 17 Apr 2018 - Tax Code)

Minister for Finance (Deputy Paschal Donohoe): I am advised by The Revenue Commissioners that the VAT rating of goods and services is subject to EU VAT law, with which Irish VAT law must comply. In accordance with the EU VAT Directive, the supply of the rental of a disability aid is considered to be a service of hiring and is liable to VAT at the standard rate, currently 23%. The VAT Directive provides for particular categories of goods and services to which a Member State may apply a lower VA...

221. Deputy Clare Daly asked the Minister for Finance the reason the standard cut-off income rate for PAYE taxation is different for married couples with one income as distinct from married couples with two incomes; if an assessment has been carried out of the discriminatory impact this has on married persons who stayed at home to raise their children; his plans regarding same; and if he will make a statement on the matter. (Question 15154/18 asked on 17 Apr 2018 - Tax Code)

Minister for Finance (Deputy Paschal Donohoe): The move towards a system of individualisation commenced in 1999, and is now integral to the overall income tax system. When first announced, the stated purposes of individualisation were to ease the burden on single persons which accounted for 65% of the work force, to take workers on the average industrial wage out of the higher rate of tax and more generally to facilitate a reduction in the numbers paying tax at the higher rate. Prior to this, ...

237. Deputy Colm Brophy asked the Minister for Finance his views in relation to the excise of heated tobacco products; and if he will make a statement on the matter. (Question 15412/18 asked on 17 Apr 2018 - Tax Code)

Minister for Finance (Deputy Paschal Donohoe): The tax treatment of tobacco products in EU member states is provided for in Directive 2011/64/EU (the ‘Tobacco Products Tax Directive’), but it does not provide explicitly for heated tobacco products.  
I am advised by Revenue that heated tobacco products, which are also known as heat-not-burn tobacco products, are a relatively recent innovation and have yet to enter the Irish market. In the event that they were to be launched on the Irish market, ...

240. Deputy Pearse Doherty asked the Minister for Finance the estimated budgetary implications of the delay in introducing the sugar tax; and if he will make a statement on the matter. (Question 15459/18 asked on 17 Apr 2018 - Tax Code)

Minister for Finance (Deputy Paschal Donohoe): I propose to take Questions Nos. 240 and 251 together.
Ireland has engaged in extensive and constructive discussions with the European Commission to ensure that once commenced, the Sugar Sweetened Drinks Tax does not infringe EU State aid law. Following these constructive discussions with, and a formal notification to, the European Commission, a positive decision is expected very soon to allow for the commencement of the tax on 1 May 2018. 
While a...

249. Deputy Thomas P. Broughan asked the Minister for Finance his plans to remove VAT and VRT from advanced driver assistance systems on new or older vehicles to incentivise the public to drive much safer vehicles and promote the Vision Zero policy of road safety; and if he will make a statement on the matter. (Question 15743/18 asked on 17 Apr 2018 - Tax Code)

Minister for Finance (Deputy Paschal Donohoe): I propose to take Questions Nos. 208 and 249 together.
I am advised by The Revenue Commissioners that the chargeable value for the calculation of Vehicle Registration Tax, the open market selling price (OMSP), is provided for in the Finance Act 1992, section 133. This section provides that the OMSP comprises the price, inclusive of all taxes, duties, enhancements or accessories, that a motor distributor might reasonably expect to fetch for a vehicl...

251. Deputy Kevin O’Keeffe asked the Minister for Finance when he plans to introduce the sugar tax as agreed in Budget 2018; his views on the fact that this delay is now causing administrative and logistical problems for many companies; and if he will make a statement on the matter. (Question 15829/18 asked on 17 Apr 2018 - Tax Code)

Minister for Finance (Deputy Paschal Donohoe): I propose to take Questions Nos. 240 and 251 together.
Ireland has engaged in extensive and constructive discussions with the European Commission to ensure that once commenced, the Sugar Sweetened Drinks Tax does not infringe EU State aid law. Following these constructive discussions with, and a formal notification to, the European Commission, a positive decision is expected very soon to allow for the commencement of the tax on 1 May 2018. 
While a...

142. Deputy Michael McGrath asked the Minister for Finance the tax rules surrounding the early extraction of pension funds, specifically if a person wishes to extract funds from their pension and invest it directly in sovereign bonds; if such a transaction is taxed; if the person wishes to transfer the funds to another registered pension fund if it would be subject to exit tax; and if he will make a statement on the matter. (Question 14370/18 asked on 28 Mar 2018 - Tax Code)

Minister for Finance (Deputy Paschal Donohoe): I am advised by Revenue that approval of occupational pension schemes under the Taxes Consolidation Act 1997 is given on the basis that retirement benefits are generally paid at normal retirement age which cannot fall before age 60. Approval may also provide, however, for early retirement from age 50 where scheme rules allow and with the employer’s consent. In such situations benefits are restricted. In the case of approval of personal pension arr...

74. Deputy Thomas P. Broughan asked the Minister for Finance his strategy on the EU Commission’s proposals to tax digital revenues in each country of the EU; and if he will make a statement on the matter. (Question 13626/18 asked on 27 Mar 2018 - Tax Code)

Minister for Finance (Deputy Paschal Donohoe): I propose to take Questions Nos. 74 and 121 together.
On Wednesday 21 March last the European Commission published detailed proposal for two different Directives on taxation and digitalisation. 
The proposals have been prepared by the Commission with limited input from Member States and we will need to study them in detail.  The proposals will now be debated, discussed and amended by Member States working together in Council.  Unanimity between all ...

94. Deputy Pearse Doherty asked the Minister for Finance his views on the concerns of the Central Bank that cash buyers such as international funds are putting home ownership beyond the reach of families; and his plans from a tax point of view to level the playing field. (Question 13654/18 asked on 27 Mar 2018 - Tax Code)

Minister for Finance (Deputy Paschal Donohoe): In the 2016 Finance Act, my predecessor introduced provisions to address concerns raised in both the media and the Dáil regarding the use of section 110 companies and certain Irish collective investment vehicles by international investors to minimise their tax payments on Irish property transactions.
Section 22, Finance Act 2016 made certain changes to the taxation of qualifying companies, within the meaning of section 110 Taxes Consolidation Act 19...

102. Deputy Maureen O’Sullivan asked the Minister for Finance further to Parliamentary Question No. 90 of 30 January 2018, if he will consider adopting a system similar to the Australian model on inheritance tax whereby there is no capital acquisition tax and instead adopt a system in which capital gains tax applies in certain circumstances; and if he will make a statement on the matter. (Question 13642/18 asked on 27 Mar 2018 - Tax Code)

Minister for Finance (Deputy Paschal Donohoe): I am advised by Revenue that section 573 of the Taxes Consolidation Act 1997 provides that the transfer of assets on the death of a person is not regarded as a disposal for capital gains tax purposes.  The assets of a deceased person are treated as having been acquired by the personal representatives or beneficiaries at their market value at the date of death.  Consequently, a CGT charge does not arise on the death of a person and any increase in va...

121. Deputy Jan O’Sullivan asked the Minister for Finance his views on digital taxation in particular current developments in the EU; and if he will make a statement on the matter. (Question 13621/18 asked on 27 Mar 2018 - Tax Code)

Minister for Finance (Deputy Paschal Donohoe): I propose to take Questions Nos. 74 and 121 together.
On Wednesday 21 March last the European Commission published detailed proposal for two different Directives on taxation and digitalisation. 
The proposals have been prepared by the Commission with limited input from Member States and we will need to study them in detail.  The proposals will now be debated, discussed and amended by Member States working together in Council.  Unanimity between all ...

173. Deputy Pearse Doherty asked the Minister for Finance his plans to update Ireland’s limited partnership legislation with regard to the funds industry; and if he will make a statement on the matter. (Question 13592/18 asked on 27 Mar 2018 - Tax Code)

Minister for Finance (Deputy Paschal Donohoe): The Irish Funds Industry Association developed proposals consistent with IFS2020 and timed to take advantage of the Capital Markets Union agenda to promote the establishment of private equity and venture capital funds vehicles in Ireland. Private Equity are typically constituted as partnerships and such funds are not common in Ireland. 
The Department of Finance analysed the proposals put forward by industry and as the proposals have implications o...

59. Deputy Niall Collins asked the Minister for Finance if he will provide an overview of the accelerated capital allowance scheme for crèches and gyms as published in the Action Plan for Jobs 2018 that has been submitted to the European Commission for state aid approval. (Question 12736/18 asked on 20 Mar 2018 - Tax Code)

Minister for Finance (Deputy Paschal Donohoe): Finance Act 2017 introduced a scheme of accelerated capital allowances for the construction of buildings and structures for use in the provision of childcare services or fitness centre facilities by employers to employees. The scheme also provides relief for expenditure incurred on related equipment. 
The rationale for introducing the relief is to help tackle the cost and availability of childcare facilities, both of which have been cited as barrie...

60. Deputy Niall Collins asked the Minister for Finance his views on proposals by the European Commission to introduce an EU wide digital services tax which would possibly threaten Ireland’s industrial policy for retaining and attracting foreign direct investment; and the steps he and his ministerial colleagues are taking at EU Council level to ensure Ireland’s interests are protected. (Question 12981/18 asked on 20 Mar 2018 - Tax Code)

Minister for Finance (Deputy Paschal Donohoe): It is my understanding that the the European Commission will bring forward proposals on Digital Taxation on 21 March. It would be premature of me to comment in advance of the publication, let alone the discussions which must take place among Member States.
We believe that further analysis is needed to achieve a globally agreed, evidence based solution, sustainable in the long run and focussed on aligning taxing rights with the location of real subs...

116. Deputy Catherine Martin asked the Minister for Finance his plans to extend income tax relief to routine dental expenses, such as fillings and extractions, in view of the introduction of the sugar tax; and if he will make a statement on the matter. (Question 12946/18 asked on 20 Mar 2018 - Tax Code)

Minister for Finance (Deputy Paschal Donohoe): Section 469 of the Taxes Consolidation Act 1997 provides for relief at the standard rate of income tax (currently 20%) on certain health expenses incurred in the provision of health care.
For the purposes of the section “Health Care” is defined as the “prevention, diagnosis, alleviation or treatment of an ailment, injury, infirmity, defect or disability” but excluding routine ophthalmic treatment, routine dental treatment and unnecessary cosmetic su...

1055. Deputy Pat Deering asked the Minister for Housing, Planning and Local Government his plans to introduce an incentive, tax or other, for persons to downsize their homes (details supplied). (Question 12662/18 asked on 20 Mar 2018 - Tax Code)

Minister for Housing, Planning and Local Government (Deputy Eoghan Murphy): The issue of the possible introduction of tax incentives is a matter for my colleague the Minister for Finance. 
My Department is committed to supporting older people to live in their own home with dignity and independence for as long as possible, as this has the best outcomes both for the individual and for society as a whole. Rebuilding Ireland aims to ensure that older people have a range of housing choices available ...

51. Deputy Mick Barry asked the Minister for Finance if he will direct the Revenue Commissioners to respond to the past four letters sent to them by PDFORRA regarding the status of flat rate expenses. (Question 11386/18 asked on 08 Mar 2018 - Tax Code)

Minister for Finance (Deputy Paschal Donohoe): I am advised by Revenue that the legislation governing the deductibility of expenses incurred in employment, as set out in section 114 of the Taxes Consolidation Act 1997, provides that, for an expense to qualify as a deduction against income from an office or employment, the expense must be wholly, exclusively and necessarily incurred in the performance of the duties of the office or employment. 
For ease of administration, where a large number of ...

153. Deputy Catherine Martin asked the Minister for Finance if there is an interdepartmental committee in operation examining the possibility of taxing civil servants’ car parking as a benefit in kind; if so, the length of time it has been in existence; when it last met; the outcomes that have resulted; his plans to introduce such a scheme; and the estimated amount of revenue that could be realised by such a measure. (Question 10068/18 asked on 27 Feb 2018 - Tax Code)

Minister for Finance (Deputy Paschal Donohoe): I am informed by Revenue that employer-provided parking is not currently subject to benefit-in-kind taxation. I do not currently have any plans to change this. My officials are unaware of a committee such as the Deputy describes.
 ...

158. Deputy Maureen O’Sullivan asked the Minister for Finance the rationale for imposing a rate of 23% VAT on dog grooming services when veterinary services are taxed under the 13.5% rate; his plans to amend the rate (details supplied); and if he will make a statement on the matter. (Question 9328/18 asked on 27 Feb 2018 - Tax Code)

Minister for Finance (Deputy Paschal Donohoe): The supply of dog grooming services is liable to VAT at the standard rate, currently 23%. The VAT rating of goods and services is subject to the requirements of EU VAT law with which Irish VAT law must comply and under the VAT Directive there is no provision to allow the reduced rate to be applied to the supply of dog grooming services. 
An exception to this rating is grooming that is required in the course of a medical or surgical treatment of ani...

162. Deputy Billy Kelleher asked the Minister for Finance the introduction date for the sugar sweetened drink tax; and if he will make a statement on the matter. (Question 9461/18 asked on 27 Feb 2018 - Tax Code)

Minister for Finance (Deputy Paschal Donohoe): I propose to take Questions Nos. 162 to 164, inclusive, together.
It is my intention to introduce the Sugar Sweetened Drinks Tax on 6 April 2018 which coincides with the introduction of a similar tax being introduced in the UK on that date.
The estimated yield for 2018 is in the region of €30m with the yield for 2019 and subsequent years €40m per annum. The yield could potentially decrease over time as consumers opt for cheaper non-tax products com...