Joe McHugh (Donegal North East, Fine Gael)
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Question 70: To ask the Minister for Finance if any tax or charge is envisaged on a product (details supplied); and if he will make a statement on the matter. [21284/11]

Michael Noonan (Limerick City, Fine Gael)
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Wood chips for domestic fuels are liable to VAT at the rate of 13.5%, as is the case with the supply of all fuel products used for home heating or light. No further tax is payable on the product. In addition, the supply and installation of wood pellet burners also apply for the most part at the 13.5% rate. In order for the reduced rate to apply the VAT-exclusive cost of the burner must not exceed two-thirds of the total VAT-exclusive charge to the customer. The bulk of supply and install contracts generally meet this two-thirds rule. It should be noted that Chapter 3 of Part 3 of the Finance Act 2010 provides for the introduction, subject to a Ministerial commencement order, of a carbon tax on solid fuel supplied in the State. However, wood chip and other fuel wood are not included in the scope of this tax.

Patrick O'Donovan (Limerick, Fine Gael)
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Question 71: To ask the Minister for Finance if changes are proposed to the current tax arrangements for capital transfers within families; and if he will make a statement on the matter. [20745/11]

Michael Noonan (Limerick City, Fine Gael)
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The tax code currently provides for various reliefs - from Capital Gains Tax, Capital Acquisitions Tax and Stamp Duty - on capital transfers within families. Capital Gains Tax (CGT):

Transfers of assets between spouses do not give rise to a chargeable gain for CGT purposes. Instead the asset is treated in the hands of the receiving spouse as having the cost and acquisition date of the spouse from whom it was acquired.

Retirement relief is a very significant CGT relief. It applies to assets that have been owned and used for the purposes of a trade or for farming for the ten years immediately prior to the disposal. It applies to a disposal of shares in family companies where certain proportions of shareholding exist. Where disposals are to unconnected persons there is a limit of €750,000 to lifetime disposals. However, where the qualifying conditions are met and the disposal is to a child of the disponer or to a nephew who has worked in the trade for the preceding 5 years, there is no limit – a full CGT exemption applies, regardless of the value of the business or farming assets transferred to the child or qualifying nephew.

There is a relief from CGT where a parent transfers a site of not more than an acre to a child. The child must build a house on the site and live in it as a principal private residence for three years. If the site is disposed of by the child without the conditions having been met, then the relief is withdrawn. There is also a relief from CGT where there is a partition, subject to conditions, of jointly owned farming partnership assets. This relief is not restricted to family members only.

Capital Acquisitions Tax (CAT):

There is a complete exemption from CAT in respect of all capital transfers by way of gifts and inheritances transferring between spouses. Apart from this overall spouse's exemption, for the purposes of CAT, the relationship between the person who provided the gift or inheritance (i.e. the disponer) and the person who received the gift or inheritance (i.e. the beneficiary) determines the maximum tax-free threshold below which gift or inheritance tax does not arise on capital transfers. Currently, there are, in all, three separate tax-free thresholds, known as group thresholds:

Group A: €332,084 - applies where the beneficiary is a child (including adopted child, step- child and certain foster children) or minor child of a deceased child of the disponer. Parents also fall within this threshold where they take an inheritance of an absolute interest from a child. A nephew or niece who has worked full-time with a disponer in a trade, business or profession may qualify for the Group A threshold in respect of the property of that business, provided certain conditions are met.

Group B: €33,208 - applies where the beneficiary is a brother, sister, a nephew, a niece or lineal ancestor or lineal descendant of the disponer.

Group C: €16,604 - applies in all other cases.

If the value of gifts and inheritances received by a beneficiary exceeds his or her tax-free Group threshold, then a rate of CAT of 25% will apply on the difference.

The CAT code also exempts a gift or inheritance of a dwelling house completely from gift or inheritance tax in certain circumstances. The main conditions attaching to the dwelling-house exemption are that the beneficiary of the dwelling-house must have resided in the dwelling-house for a minimum of three years prior to the gift or inheritance and must not have an interest in any other dwelling-house. Family members can also claim agricultural relief or business relief from CAT, if the property gifted or inherited qualifies as agricultural or business property respectively.

Stamp Duty:

All transfers of property between spouses are exempt from stamp duty. Apart from this exemption, the stamp duty payable on transfers of non-residential property between family members is reduced by 50%. There is also an exemption from stamp duty on the transfer of agricultural land to a farmer who is under 35 years of age and who is the holder of certain educational qualifications. This exemption is not restricted to family members only.

A number of possible changes to the CAT and CGT provisions are under consideration as part of the proposed reform of capital taxation as outlined in the EU-IMF programme. The Deputy may be aware that the CAT Group tax-free thresholds were reduced by approximately 20% in Budget 2011. The nature, level and timeframe of any changes will be determined in the context of the Budget following the comprehensive expenditure review.

Eric Byrne (Dublin South Central, Labour)
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Question 72: To ask the Minister for Finance the estimated cost to the Exchequer in 2010, 2011 and 2012 of granting deductions for interest against rental income for residential and commercial properties to individual taxpayers. [20794/11]

Michael Noonan (Limerick City, Fine Gael)
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I am informed by the Revenue Commissioners that based on personal income tax returns filed by non-PAYE taxpayers for the year 2008, the latest year for which this information is available, the amount of tax foregone by allowing a deduction for interest on borrowings to be offset against rental income assessable under Case V, Schedule D is estimated to have been of the order of €1,150 million. This estimate is based on assuming that tax relief was allowed at the top income tax rate of 41% and the figure provided could therefore be regarded as the maximum Exchequer cost in respect of those taxpayers. I am advised by the Revenue Commissioners that they are not in a position to provide data for 2009 and later years as the tax returns for that year and subsequent years are not yet due. The figures for 2008 are subject to adjustment in the event of late returns being filed or where returns already filed are subsequently amended.

It should be noted that any corresponding data returned by PAYE taxpayers in the income tax return form 12 is not captured in the Revenue computer system. However, any PAYE taxpayer with non-PAYE income greater than €3,174 is required to complete an income tax return form 11. This return is the source of the figures provided in this reply. The Deputy will no doubt be aware that the level at which interest repayments can be claimed against tax for residential rental properties was reduced from 100% to 75% in section 5 of the Finance Act 2009 at an estimated full year yield of €95 million.

Eric Byrne (Dublin South Central, Labour)
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Question 73: To ask the Minister for Finance the estimated cost to the Exchequer in 2010, 2011 and 2012 of granting deductions for interest against rental income for residential and commercial properties to companies. [20795/11]

Michael Noonan (Limerick City, Fine Gael)
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I am informed by the Revenue Commissioners that as the rental income of companies is returned as net of interest on borrowings the figures for interest are not separately distinguished in corporate tax returns. There is, therefore, no basis on which an estimate of the cost of tax relief involved could be provided.

Eric Byrne (Dublin South Central, Labour)
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Question 74: To ask the Minister for Finance the expected cost to the Exchequer of tax forgone in 2010, 2011 and 2012 on property-related tax schemes, including legacy schemes that are now closed. [20797/11]

Michael Noonan (Limerick City, Fine Gael)
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I am informed by the Revenue Commissioners that the relevant information available on the cost to the Exchequer of all property related tax schemes is based on personal income tax returns filed by non-PAYE taxpayers and corporation tax returns filed by companies for the year 2009, the latest year for which this information is available. These are set out in the table below.

It should be noted that any corresponding data returned by PAYE taxpayers in the income tax return (Form 12) is not captured in the Revenue computer system. However, any PAYE taxpayer with non-PAYE income greater than €3,174 is required to complete an income tax return (Form 11).

The estimated relief claimed has assumed tax forgone at the 41% rate for 2009 in the case of individuals and 12.5% in the case of companies. The figures shown correspond to the maximum Exchequer cost in terms of income tax and corporation tax.

The figures for 2009 are subject to adjustment in the event of late returns being filed or where returns already filed are subsequently amended. Corresponding data cannot yet be provided for 2010 and later years as the tax returns for that year and subsequent years are not yet due.

Eric Byrne (Dublin South Central, Labour)
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Question 75: To ask the Minister for Finance the Revenue Commissioners' best estimate of the amount of Schedule D Case V losses being carried forward by individual taxpayers based on 2009 tax returns, or the latest year available. [20799/11]

Eric Byrne (Dublin South Central, Labour)
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Question 76: To ask the Minister for Finance the Revenue Commissioners' best estimate of the amount of Schedule D Case V losses being carried forward by companies based on 2009 tax returns, or the latest year available. [20800/11]

Eric Byrne (Dublin South Central, Labour)
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Question 77: To ask the Minister for Finance the Revenue Commissioners' best estimate of the amount of unused capital allowances being carried forward by persons for offsetting against future Schedule D Case V income based on 2009 tax returns, or the latest year available. [20801/11]

Eric Byrne (Dublin South Central, Labour)
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Question 90: To ask the Minister for Finance the Revenue Commissioners' best estimate of the amount of unused capital allowances being carried forward by companies for offsetting against future Schedule D Case V income based on 2009 tax returns, or the latest year available. [20814/11]

Michael Noonan (Limerick City, Fine Gael)
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I propose to take Questions Nos. 75 to 77, inclusive, and 90 together.

I am informed by the Revenue Commissioners that on the basis of Form 11 tax returns for 2009 the amount of Schedule D Case V losses brought forward by individual taxpayers is €2.1 billion. Based on CT1 tax returns filed by companies for 2009 the corresponding amount of Schedule D Case V losses brought forward by companies is €265.5million. On the basis of the 2009 tax returns the amount of unused capital allowances carried forward by individuals for offset against future Schedule D Case V income is €1.8 billion. As there is no requirement to provide the necessary information in corporate tax returns, it is not possible to provide an estimate of the amount of unused capital allowances being carried forward by companies for offset against future Case V income.