John Perry (Sligo-Leitrim, Fine Gael)
Link to this: Individually | In context

Question 339: To ask the Minister for Finance his plans to abolish VAT for first time home buying couples or parents in Counties Sligo and Leitrim; his further plans to provide extra tax relief following the birth of a child; and if he will make a statement on the matter. [32537/05]

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

The position is that the VAT rating of goods and services is subject to the requirements of EU VAT law with which Irish VAT law must comply. Under the sixth VAT directive, member states may retain the zero rates on goods and services which were in place on 1 January 1991, but cannot extend the zero rate to other goods and services. As the supply of property was not subject to the zero rate on 1 January 1991, it is not possible to apply the zero rate to this item. In addition, the VAT rate that applies to a particular good or service is determined by the nature of the good or service, and not by the location of the customer. There is no provision in EU VAT law that would allow for the abolition of VAT for first time buyers.

In regard to the question of providing extra tax relief following the birth of a child, I would remind the Deputy of the long-standing practice of Ministers for Finance not to comment on what may or may not be contained in upcoming budgets. I do not intend to depart from that approach.

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

Question 340: To ask the Minister for Finance his estimate of the payments into pension schemes in 2002 on which tax relief is made; and the average rate of tax relief applying to the different category of contributor. [32560/05]

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

As I pointed out in my replies to recent parliamentary questions tabled by the Deputy on this topic, the estimated figures in respect of employee and employer contributions to occupational pensions are only available in aggregate form on a tentative basis.

Subject to those limitations, and using some data obtained from the Pensions Board, the estimated cost of €563 million for tax relief on employee contributions in respect of the income tax year 2002, the latest available, was derived by applying an overall average marginal rate of tax to an approximate overall contribution base of €1,942 million.

As regards employer contributions to employee occupational pension funds, using the estimated level of employee contributions as a basis and making certain assumptions as to both the total amount of employer contributions and the proportion of those contributions made by tax liable companies at the standard rate of corporation tax, which was 16% in 2002, and at the relieved rate of 10%, an approximate overall contribution base of €4,600 million and €623 million cost in tax forgone for 2002 were estimated.

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

Question 341: To ask the Minister for Finance the income within superannuation schemes on which tax relief is provided distinguishing the type of income in the funds and the exemptions from tax they enjoyed in 2002 which underpin the estimate of €1,270 in cost of relief. [32561/05]

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

I am informed by the Revenue Commissioners that the basis for existing estimated figures of the net income of approved superannuation funds, contributions plus investment income less pension outgoings, is aggregated data estimated on a very tentative basis.

Using estimates of the value of assets held by Irish pension funds provided by the Irish Association of Pension Funds, making certain assumptions as to the value of both the investment income and pension outgoings of superannuation funds and also taking into account the available estimates for employee and employer contributions to occupational pensions, the base value of the net income of the funds is estimated at close on €6,360 million. The estimated cost of almost €1,272 million for the cost of tax exemption in 2002 is based on the assumed application of the standard rate of income tax to this base value.

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

Question 342: To ask the Minister for Finance the distribution of the 111,000 persons who claimed retirement annuity relief from taxation across the income distribution bands showing for each band the amount of annuities paid, the tax relief and the numbers involved. [32562/05]

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

I am informed by the Revenue Commissioners that the relevant information available is in respect of income tax relief allowed for contributions to retirement annuity contracts for the income tax year 2002, which are available to the self-employed and to employees not in occupational pension schemes. A distribution by income ranges of the number of cases, amount of deduction and reduction in tax for tax relief for retirement annuity contracts is contained in the following table:

The figures for the total number of cases and the total reduction in tax shown in this table are lower than those indicated in the table supplied with the reply I gave to Question No. 162 on 27 October because the figures now being provided represent approximately 95% of all income tax returns expected for 2002, while the figures supplied on 27 October were, in accordance with normal practice, grossed up at aggregate level to adjust for this 5% incompleteness.