Seanad debates

Wednesday, 6 November 2013

Social Welfare and Pensions Bill 2013: Committee Stage

 

2:00 pm

Photo of Averil PowerAveril Power (Fianna Fail) | Oireachtas source

If I may respond directly on that point before Senator Mooney asks about another issue, the crucial point is that the income will be subject to tax but the Minister is not providing for disregards from the PRSI liability in the way she does from income tax. That is the gap, and it is a huge gap because the reality is that somebody who does not pay any income tax on their rental property currently because their losses are so significant they do not have an income tax liability, having taken into account their expenditure, will now have to pay PRSI on that property. That is the difference. I agree the income is the same but not having the same disregards as the Minister has for the income tax side, the result is completely different. That is the reason it needs to be rephrased to ensure the legislation only refers to profits from rental properties. At the very least the Minister should provide the same disregards. The legislation should at least state that if the areas that would be discounted from rental income for the purpose of income tax, such as capital expenditure, repairs on a home, 75% of the mortgage interest and so on, logically they should also apply from the PRSI base as well, even using the argument the Minister just made about the need for the two systems - the income tax side and the PRSI side - to work in a similar way. I ask that the Minister would examine that and, if necessary, consult with the Minister for Finance on it between now and Report Stage. I thank the Minister for her engagement on it.

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