Michael McGrath (Cork South Central, Fianna Fail) | Oireachtas source

We had a good debate on this issue on Committee Stage when I also tabled an amendment on this issue. While I accept the need to introduce a threshold, the current threshold is high.

A more fundamental point about the incentive scheme is, because the Minister is doing it through the income tax system, somebody must have an income tax liability in the first place against which to offset this credit whereas, in effect, what the Minister is doing is giving the person the VAT back. A more equitable system would have been to return the VAT to applicants even if they had not an income tax liability. That would have been a fairer way. Because of the way it will be done through the income tax code and the €5,000 threshold, the scheme provides a greater benefit to those who have a great deal of money - those who have an income tax liability and who have €5,000 or more to spend. That is the nature of its construction. It will benefit disproportionately those who have money and who have an income tax liability against which the credit will be offset.

See this speech in context