Simon Harris (Wicklow, Fine Gael) | Oireachtas source

For three years I have tried to convince the Deputy to agree with me on an issue so let us give it a go. Much of what the Deputy referenced relates more to the Construction Contracts Act than to the tax side and, therefore, it would be important to get that Act implemented. Responsibility for the Construction Contracts Act has been given to the Minister of State at the Department of Jobs, Enterprise and Innovation, Deputy Gerald Nash. It is hoped to have the legislation activated by next year and that is the appropriate route to take. In terms of the need to examine public contracts, we are carrying out a review of public contracts at the moment. I have responsibility for it as it comes under the remit of the Office for Government Procurement.
On the broader issue of the potential difficulties posed by public contracts, I would very much like to receive correspondence from the Deputy on the matter and I shall get back to him about it. It would be useful for me to read out the speaking note as the section is quite technical. This is essentially a technical change to address two issues. First, to remove any suggestion that it is possible for a payment to be taxed twice and second, to ensure that penalties are proportionate.
Where a principal contractor has failed to operate the relevant contracts tax, section 530F(3)(a) of the Taxes Consolidation Act 1997 provides that where the principal submits details of the relevant payment, and submits to Revenue any further information required such as a contract notification, Revenue will then establish the amount of tax which would have been due from the principal in respect of the payment using the subcontractors deduction rate and this will then become the tax due from the principal. I told the Deputy that this was a technical provision.