Darragh O'Brien (Fianna Fail) | Oireachtas source

I move recommendation No. 2:

In page 10, to delete lines 42 and 43, and in page 11, to delete lines 1 to 4 and substitute the following:

"(I) in the year in which the qualifying work was carried out by an amount which is the lesser of-

(I) The specified amount of the payment or payments, and
(II) The amount which reduces the income tax of that year of assessment to nil,".

This recommendation concerns the home renovation incentive scheme which I welcomed on Second Stage. However, some improvements could be made to it. Our recommendation would allow the benefit of the tax credit to be gained in the year in which the work was carried out and not to be spread over the two subsequent years. Under the Minister's proposals, the credit will be obtained in the two years after the work is carried out, with the first relief payment in 2015. There would be a greater take up of the scheme if the Minister allowed the tax relief to be obtained in one year as opposed to being spread over two years and in the year or, at the very least, the year following the one in which the works are carried out.

I would like to hear the Minister's thoughts on that. I am just trying to be helpful in this regard. The scheme is good and we have welcomed it. I hope it will have the effect of reducing the amount of work being done in the black market in this area. There are registered contractors who are tax compliant competing against people who are doing work for cash. The Minister's proposals should assist in this regard because applicants have to use a tax-compliant and properly registered and qualified contractor. There is a double effect in that people will get tax relief for improving their houses and smaller contractors should be supported. However, the scheme could be improved somewhat by allowing the tax relief to be paid in the year in which the work is done, or, if it is late in the year, the subsequent year. That is our recommendation.