Tom Parlon (Laois-Offaly, Progressive Democrats)

If I understand the Senator's recommendation correctly, he is proposing that the Minister for Finance take power to make regulations to provide that where payments made to State and other bodies qualify for income tax relief, the service providers would make this information available to Revenue Commissioners in order that such information could then be used by them to deal with potential overpayments of tax. If that is the case, what the Senator is proposing is an extension of the tax relief at source principle which is in place in respect of medical insurance premiums and mortgage interest payments. While tax relief at source is operating successfully in both these areas, it is not a system suitable for all reliefs. Ideally, the system needs a small number of payment recipients relative to a large and regular number of payers. There are not that many reliefs which meet such criteria. The system would not be cost-effective either for the Revenue or for the payee in regard to once-off or irregular payments to a wide variety of payees.

There is also an Exchequer cost in that to work smoothly, the tax relief at source must apply to all payers regardless of whether they are liable for tax. While I cannot accept the Senator's recommendation, I assure him the Minister is continually reviewing the various reliefs in the context of tax relief at source and how it may apply to them.