Peter Fitzpatrick (Louth, Fine Gael) | Oireachtas source

The Government decided to bring budget day forward from the first week in December to on or before 15 October. The Bill includes the measures announced on budget day and also contains details of a number of other changes, including many of a technical or administrative nature.

The Bill provides for changes to the research and development tax credit regime announced by the Minister on budget day. The research and development outsourcing limit will be increased from 10% to 15% of qualifying expenditure, while the annual limit applied to the alternative volume basis for relief will be increased from €200,000 to €300,000. Where it is established by Revenue that a company's research and development tax credit was deliberately false or overstated and the company surrendered part or all of the credit to a key employee, the tax forgone shall be recovered from the company rather than the employee.

Some 25 pro-business and pro-jobs measures were introduced in the budget. The retention of the 9% rate of VAT for the tourism and hospitality sectors will support the increased number of jobs created and the creation of new jobs and will, therefore, continue to apply to a range of services, including restaurants and catering, hotel accommodation, newspapers, hairdressing, admission to cinemas, theatres and museums.

A scheme of tax relief for home renovation work will be available for expenditure incurred between 25 October 2013 and 31 December 2015 on the repair, renovation or improvement of an individual's principal private residence in the State. Relief will be granted at a rate of 13.5% on qualifying expenditure up to a maximum of €30,000, excluding VAT. The minimum level of expenditure must be €5,000, excluding VAT. Relief will be granted by way of tax credit split over two years following the year in which the works are carried out. Restrictions apply where expenditure is grant-aided or met from insurance compensation. The contractor must be registered and tax compliant.

As an employment activation measure, the start-your-own business incentive will provide for an exemption from income tax up to a maximum of €40,000 per annum for a period of two years for individuals who set up a qualifying, unincorporated business, having been unemployed for a period of at least 15 months prior to establishing the business.

The range of qualifications required to become eligible for young trained farmers' relief is extended to include three additional qualifying courses. This will apply to the 100% rate of stock relief and the stamp duty relief for the purchase of agricultural properties. The Bill includes provisions to curtail the 50% rate of stock relief available to farmers in registered farm partnerships which was provided for in the Finance Act 2012. The changes are required to address the requirements for EU approval under state aid rules. Approval has been granted on the basis that the relief will be restricted, as provided for in the Bill, to an amount of €7,500 over a three year period.

The Bill includes a provision which exempts from tax the annual allowance of €1,000 paid to volunteer members of the Garda Reserve. Under the JobsPlus scheme, grants paid to employers participating in JobsPlus schemes on or after 1 July 2013, administered by the Department of Social Protection, will not be subject to tax. Also, the employment and investment incentive will be removed from the high earners restriction for a period of three years in order to stimulate investment in SMEs. The lump sum payment made by the Minister for Justice and Equality to survivors of the Magdalen laundries will be exempt from income tax, the universal social charge, capital gains tax and capital acquisitions tax.

The farmers' flat rate addition is being increased from 4.8% to 5% with effect from 1 January 2014. The flat rate scheme compensates unregistered farmers for VAT incurred on their farming inputs. The flat rate addition is reviewed annually in accordance with the EU VAT directive. The increase to 5% in 2014 continues to achieve full compensation for farmers.

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