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

I move amendment No. 7:

In page 20, between lines 12 and 13, to insert the following: "Report on flat rate expenses

17.The Minister shall, within 3 months of the passing of this Act, prepare and lay before the Oireachtas a report on the review by the Revenue Commissioners on flat rate expenses and ways in which low and medium income earners can be protected from any change that may arise.”.

This amendment relates to the flat-rate expenses allowance system. We have had a number of opportunities to discuss this in recent weeks, initially on Committee Stage and then during parliamentary questions to the Minister for Finance last week. I am not sure if he has any update at this point. It is worth reminding ourselves of the scale of this system and the quantum of money involved. I know that 2017 is the latest year for which we have data. There are 53 categories of employment affected and 134 individual flat-rate expenses allowances. More than 600,000 employees currently avail of these allowances at a gross cost of €163 million. The net cost, by way of reduction of tax, is €48 million. We are talking about a wide range of workers including miners, shop assistants, nurses, firefighters, and porters. If this system changes adversely, they are looking at a potential unwelcome surprise in their pay packets come January, although we hope that will not come to pass.

I assume that Revenue, as part of this review, will take into account the fact that changing to a different system whereby employees have to submit claims individually for expenses incurred wholly, exclusively and necessarily in the performance of duties will represent a cost to it. Changing from a system of agreed allowances for particular categories to assist the people in those categories to one in which up to 600,000 individual employees will have to submit claims will involved significant costs for the public purse. We have discussed this in recent weeks and the Minister agreed to write to Revenue for an update. I hope he will provide an update to the House at the earliest opportunity. The purpose of tabling the amendment and seeking the report is really to facilitate a debate on Report Stage.

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