Willie O'Dea (Limerick East, Fianna Fail)

This issue has been around for some time. When studying at the Institute of Chartered Public Accountants in UCD I was taught that self-employed people may claim travel expenses incurred for the purposes of their businesses whereas employees may claim only for travel undertaken in the performance of their duties, a somewhat narrower hoop to get through.

The difficulty that arises in this regard is cost. We cannot provide a tax reduction in respect of travel expenses for every employee. A person's travel to work is not travel undertaken in the performance of his or her duties. An employee required to travel as part of his or her duties may claim tax relief on such expenses. To provide tax relief on travel expenses for every employee in the country — we now have 700,000 more people at work despite the redundancies referred to — would result in enormous cost to the Exchequer. It would also mean some of the tax reliefs given to the less well-off would have to be reversed or partially reversed.

Senator Kelly will be aware of the salary sacrifice scheme, whereby persons employed by a large concern agree to sacrifice part of their salaries in lieu of public transport expenses, the cost of which is not taxable. There are considerable tax savings to be made in this regard provided the people concerned use public transport. I understand some private operators now come within the remit of this scheme. As I understand it, the deal must be for 12 months and, a person who cannot afford to purchase an annual ticket and gives a commitment to purchase a ticket monthly is also covered by the scheme.