Ivor Callely (Dublin North Central, Fianna Fail)
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Question 194: To ask the Minister for Finance the benefits of the bio-fuel scheme and the environmental friendly tax benefit schemes in place; and if he will make a statement on the matter. [10678/07]

Brian Cowen (Laois-Offaly, Fianna Fail)
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While the promotion of biofuel is primarily a matter for my colleague, the Minister for Communications, Marine and Natural Resources, I am pleased to inform the Deputy that in the Finance Act 2006 I provided for significant tax measures to promote biofuels in Ireland.

The main benefits of this scheme, which received the necessary EU State Aid approval and commenced in November 2006, include:

providing for excise relief on up to 163 million litres of biofuels per annum;

they cost over €200m over 5 years;

when fully operational, they will result in CO2 savings of over 250,000 tonnes per annum;

they contribute towards meeting a target of 5.75% transport fuel market penetration by biofuels by 2009;

they help reduce our dependency on conventional fossil fuels, and

they stimulate activity in the agricultural sector.

As a complementary measure, I provided in the Finance Act 2006 for a new 50% VRT relief to promote new flexible fuel vehicles (cars designed to operate on biofuels) for an initial period of two years, and extended the existing VRT relief for hybrid cars by a further year to end 2007. I am also providing in the Finance Bill 2007 for the introduction of a VRT relief of 50% for electric cars — cars which can be propelled by a rechargeable battery — on a pilot one year basis with effect from 1 January, 2007.

In addition I announced in the Budget the commencement of a public consultation process on adjusting VRT to take greater account of CO2 emissions of vehicles. A similar exercise is under way in the area of motor tax. Any changes will have effect from a target date of 1 January 2008.

Paul McGrath (Westmeath, Fine Gael)
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Question 195: To ask the Minister for Finance if, in view of his budget 2007 statement (details supplied), he will confirm the arrangements that have been made with the financial institutions; and if he will make a statement on the matter. [10817/07]

Brian Cowen (Laois-Offaly, Fianna Fail)
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I am advised by the Revenue Commissioners that arrangements are in place with the Financial Institutions relating to the introduction of DIRT exempt savings accounts as announced in the Budget and the scheme will be implemented as soon as the Finance Bill is enacted. The scheme will be available to individuals or their spouses who are aged 65 years of age or over and to those persons or their spouses who are permanently incapacitated, whose total annual income is no more than the relevant income tax exemption limit — for 2007 this is €19,000 for a single or widowed person and €38,000 for a married couple.

Revenue have had detailed discussions with the Financial Institutions including Credit Unions and the Post Office Savings Bank. The Financial Institutions will be in a position to operate the scheme following the enactment of the Finance Bill. For persons aged 65 years of age or over, they will merely have to complete a self-certification application form and deliver it to their Financial Institution who will then apply DIRT exempt status to the nominated account. For persons who are permanently incapacitated, the application form will be returned to Revenue, who will in turn notify the Financial Institution to apply DIRT exempt status to the nominated account.

Arrangements are being made to have application forms and information leaflets available in early April on Revenue's website, www.revenue.ie, from Revenue offices and from Financial Institutions. In addition, the Revenue Commissioners will distribute application forms and information leaflets for those who are permanently incapacitated through the appropriate disability organisations. Full details on the operation of the scheme and availability of application forms and information leaflets will be advertised in early April.