Emmet Stagg (Kildare North, Labour)
Link to this: Individually | In context

Question 9: To ask the Tánaiste and Minister for Finance the source of concerns that certain charities may be claiming tax reliefs on false donations; the estimate of the likely extent of such a problem; if there are proposals under consideration by him to amend legislation for charitable tax status; and if he will make a statement on the matter. [15617/08]

Brian Cowen (Laois-Offaly, Fianna Fail)
Link to this: Individually | In context

The provisions of section 848A of the Taxes Consolidation Act 1997 govern the operation of the scheme for tax relief on donations to eligible charities and other approved bodies. The administration of those provisions is the responsibility of the Revenue Commissioners. To avail of the donations scheme a charity must be specifically authorised by the Revenue Commissioners for the purposes of the scheme and that authorisation falls to be renewed every five years.

The donations scheme was introduced in 2001 and a substantial number of authorisations under the scheme were issued in the years immediately following its introduction. Therefore, many of these are now due for renewal and, as part of the routine renewal process, the Revenue Commissioners are carrying out a programme of reviews to ensure that charities which have been authorised under the donations scheme are continuing to comply with the terms of their authorisations. This review involves contacting these charities and seeking their accounts and other relevant information.

There has been some media speculation recently that this exercise was triggered by fears that charity organisations were defrauding the State. However, the Revenue Commissioners have no evidence that there are significant or widespread problems in the sector. The level of review activity is in part a product of the level of authorisations coming up for renewal at the same time but it is also an ongoing feature of Revenue's compliance monitoring activity.

There are no proposals under consideration to amend the legislation governing charitable tax status, although the Charities Bill, which completed Committee Stage recently, provides for the appointment of a new charities regulator and sets out a framework for better regulation of charities. However, the Revenue Commissioners will retain responsibility for the administration of the donations scheme and charitable tax exemption.

Joan Burton (Dublin West, Labour)
Link to this: Individually | In context

There are reports that Revenue is concerned that bogus claims are being made by charities which seek to recover tax on apparent donations, which are not donations, certainly not donations to what the ordinary person would understand to be a good and proper charity. The difficulty is that the Charities Bill has been kicked around by the Government since 1997 and is still on Report Stage. It has had a journey through so many Departments, it must be suffering an identity crisis. As it is still on Report Stage, there is no legislation in Ireland governing charities.

Irish people are renowned for being extraordinarily generous to charities, both in Ireland and overseas, but there are serious concerns that the Revenue scheme is open to abuse. Is the Minister not concerned that if bogus claims are made for recovery of tax by bogus operators, it brings all charitable activity in Ireland into disrepute, including that by organisations which work hard and do excellent work here and abroad? Will the Minister elaborate on the trawl by the Revenue Commissioners? There are thousands of registered charities. How many are involved?

Brian Cowen (Laois-Offaly, Fianna Fail)
Link to this: Individually | In context

As I said in my primary reply, the review is part of the ongoing monitoring of the authorisations, many of which are coming up for renewal at the same time. It was suggested in the media that this was a result of a fundamental concern by Revenue that matters were not as they should be. The tenor and content of my reply is to the effect that Revenue is not indicating that this is the case. Instead, for the reasons I have given, Revenue is indicating that these are matters it must deal with but that it does not believe there is a serious or widespread problem, or a problem such as was perhaps communicated through the media because these reviews were taking place. People assumed the worst when, as I understand it, that should not be the case.

I do not know the number of authorisations Revenue is examining at present but I will try to get that information for the Deputy. Some 2,040 bodies have been approved under the donation scheme since its introduction in 2001. Last year, the number of PAYE donors was more than 81,000 and €25.3 million was refunded under the donation scheme to charities and approved bodies.

Joan Burton (Dublin West, Labour)
Link to this: Individually | In context

There are many reports to the effect that, for example, in regard to private schools it is possible for parents to construct schemes of donations within a charitable framework which effectively means that those schools have a benefit over and beyond that which an ordinary State-run school might have. When does the Tánaiste expect that the charities legislation will be implemented? I would be grateful if he could supply to me by written reply some of the figures to which he has just referred, or any other details he has.

Brian Cowen (Laois-Offaly, Fianna Fail)
Link to this: Individually | In context

I will try to get whatever further information I can for the Deputy in terms of what numbers are being examined at present. It is not correct to suggest there is a preference with respect to types of schools. Since 2001 all primary and post-primary schools providing education based on a programme prescribed and approved by the Minister for Education and Science automatically qualify as approved bodies for the purposes of the donations scheme. As the Deputy knows, there are approximately 4,000 such schools in the State. The matter of whether they are fee-paying schools is not a consideration.

Richard Bruton (Dublin North Central, Fine Gael)
Link to this: Individually | In context

As this is the last time the Minister will appear on finance questions, I wish him well in his future endeavours. I hope he will remember those of us who still labour here in the vineyard and that he will cast a kind eye towards us from time to time from his great position of authority. I wish him well. I have enjoyed working with him for more years than I care to count. Good luck with the job.

Joan Burton (Dublin West, Labour)
Link to this: Individually | In context

I too wish the Tánaiste good luck for his own sake and the sake of the country in the job and the challenges that lie ahead. I am sure he is very confident of being elected and I am sure everything will go right on the great day. I am not sure the Tánaiste has always enjoyed working with me, but let us hope we can kiss and make up at this point and look forward to a better relationship in the future. I have certainly found it very interesting, at times entertaining and usually quite instructive working with him. I wish him the best in the future.

Brian Cowen (Laois-Offaly, Fianna Fail)
Link to this: Individually | In context

I thank Deputy Bruton and Deputy Burton for their kind remarks. I know they are meant in the best possible way. As has been said, in the rough and tumble of politics we crossed swords now and again but never in a way that affected personal relationships, even if we did not foster them as much as we should have. As regards the exalted office, I will have to talk to Deputy Bruton about a fraternal understanding as to how exalted the office might be in the future.

Charlie O'Connor (Dublin South West, Fianna Fail)
Link to this: Individually | In context

I also wish the Tánaiste well.