Heather Humphreys (Cavan-Monaghan, Fine Gael)

I welcome the opportunity to speak on the Finance Bill and I commend the Minister for introducing it. The Bill will give effect to a number of measures announced in the budget in December. There are welcome measures in the Bill but there are also difficult choices that must be made. However, it is clear the Government has done its utmost to protect the most vulnerable in society and to help those who are most in need.

This is particularly true of the changes made in mortgage interest relief. Mortgage arrears are a serious matter and affect people across the country on a daily basis. Statistics from the Central Bank show more than 62,000 mortgages are now in arrears for more than 90 days, figures that give us an insight into the scale of the crisis we face. The Bill will allow for mortgage interest relief to be increased to 30% for first time buyers who purchased their homes between 1 January 2004 and 31 December 2008. It will be of significant benefit to those who bought their homes at the height of the boom.

Inevitably, there will be those who purchased their home just outside this time frame and they will not be entitled to the special rate of 30%. Unfortunately, a line had to be drawn somewhere. The aim is that the applicable time-frame will cover the period when house prices were at their peak, which is to be welcomed. I further welcome the fact that mortgage interest relief will be available at a 25% rate for first time buyers in 2012 because this should act as an incentive to young people who are looking to get on the property ladder.

The measures outlined will be of significant assistance to many people who are encountering problems with their mortgages. During the debate on the Keane report some months ago, the point was made that the objective of the Government must be to assist those who have genuine difficulties in meeting their mortgage repayments. That goal remains the same. The mortgage crisis in this country is different and must remain at the forefront of the Government's plans. In this regard, the publication of the personal insolvency Bill is a welcome development and should offer further assistance to homeowners who find themselves with an unsustainable mortgage.

Since taking office the Government has consistently sought to reward and incentivise work. One of its first actions was to reverse the cut to the minimum wage, which was introduced by the previous Government. The Minister has been consistent in trying to protect low earners, which was again demonstrated by the increase in the exemption threshold for the universal social charge. This means anyone who earns less than €10,036 will not have to pay the charge, which will have a positive impact on more than 300,000 in low paid jobs, particularly part-time workers and students.

At present the universal social charge hurts the lowest paid. In some circumstances it acts as a deterrent to taking up employment because by the time it is deducted from a person's wages, that person might be as well off on jobseekers' allowance. This situation cannot be allowed to continue as it discourages employment. Ultimately, the State and the taxpayer will pay the price for that.

One of the most welcome aspects of the Bill is what it does not include. There will be no increases in income tax. The Bill will not affect people's take home pay and that is welcome because it incentivises employment and encourages spending. As we are all aware, we live in difficult financial times, which means that tough decisions are unavoidable. As a Deputy from Cavan-Monaghan, in the Border region, the increase in VAT from 21% to 23%, which took effect on 1 January is not particularly welcome but I recognise that we cannot avoid making these decisions. It should be remembered a commitment to increase VAT by 1% in 2013 and a further 1% by in 2014 had been agreed by the last Government, therefore, this move simply brings the increases forward.

As the Minister stated, for the majority of the last 20 years, the VAT differential between the Republic and Northern Ireland has been 3.5%, rising to as much as 6.5% as recently as 2009. After this increase, the differential will be 3%, so there is no major change. It should be remembered the VAT on goods and services in the tourism sector remains at 9%. This measure, that was introduced as part of the jobs initiative last July, applies to hotels, restaurants and leisure facilities and is significantly lower than the VAT rate on similar services in Northern Ireland. We are, therefore, ideally placed to benefit from an increase in visitors from Northern Ireland and, as always, life on the Border has its ups and downs.

A further welcome measure in the Bill is the special assignee relief programme. This measure is a tax incentive aimed to encourage skilled individuals to take up a position in an Irish-based company and is a case of encouraging those with the necessary skill-set to come to work in Irish companies.

There is provision in the Bill to strengthen Revenue powers to combat the criminal laundering of marked oil, where a marked fuels trader's licence will be required for every trader producing, holding, dealing in or delivering marked gas, oil or kerosine. The issue of diesel and oil laundering is rampant in the Border region, particularly in County Monaghan. It is a situation that must be addressed urgently. I support any measures that will provide the Revenue Commissioners with sharper teeth to police the matter.

I support this Bill. It contains a number of measure that will be of significant benefit to people. The Government has adopted a fair approach in that the lowest paid and most vulnerable are protected.

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