Michael Noonan (Limerick City, Fine Gael) | Oireachtas source

I move amendment No. 68:

In page 79, to delete lines 30 and 31 and substitute the following:"obtains cash from an automated teller machine situated in the State by means of a cash card or a combined card;".

These amendments which propose to further amend sections 123B and 124 of the Stamp Duties Consolidation Act 1999 relate to the annual stamp duty charge that applies to the different types of card issued by financial institutions, including ATM cards, debit cards and credit cards. In regard to section 6 which amends section 123B of the 1999 Act, I announced in the Budget Statement that I was replacing the current flat rate charges for cash cards and debit cards of €2.50 and €5, respectively, with a charge of 12 cent for each cash withdrawal from an ATM. I am seeking to incentivise consumers to use more modern forms of payment such as debit cards instead of withdrawing cash from ATMs. I am also seeking to reduce the amount of cash in circulation. After the publication of the Finance Bill, my officials engaged in further consultation with representatives of the financial services sector. A number of amendments are proposed on foot of this consultation. The amendments are intended to address concerns that have been raised about the practical effects of changing from a flat rate charge to a charge based on usage. They will also generally update section 123B of the 1999 Act in order that it reflects current banking practice.

Amendment No. 69, the main amendment in the group, specifies 31 December in each year as the date that determines whether a charge arises. A charge will arise where the particular card is valid on that date and where the cardholder has an address in the State on that date. The charge is also being confined to cash withdrawals from ATMs situated in the State. Provision is being made for circumstances in which a card that is cancelled or expires during a year is replaced by another card before 31 December of that year. The original card and the replacement card are treated as a single card for the purposes of liability to the stamp duty charge and imposing the monetary cap on the charge.

There are a series of minor technical amendments in relation to the removal of references to debit cards as such cards, within the meaning of section 123B, have become redundant. In practice, cards that a debit function only have been replaced by cards that contain the dual functions of a cash card and a debit card. Section 123B refers to such cards as combined cards. The higher monetary cap of €5 compared to the lower cap of €2.50 is only applied where both functions of a "combined card" are used. Where only the cash card function is used the lower monetary cap applies.

An amendment that is not connected with the charge on the basis of charge was made to sections 123B and section 124 of the Finance Bill, as published, so as to update the definitions used in these sections for different types of financial institution. These definitions are based on those used in EU regulations. However, an unintended consequence of adopting the current EU regulation was to bring An Post and credit unions within the charge to stamp duty. These latest amendments to sections 123B and 124 exclude these bodies and maintain the status quoin relation to chargeable persons.

I recommend the amendments to the House.