Willie O'Dea (Limerick City, Fianna Fail)
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Question 117: To ask the Minister for Finance the revenue loss to the Exchequer from the abolition of the PRSI charge on share-based remuneration; and if he will provide an estimate of the jobs protected by the abolition. [25989/11]

Michael Noonan (Limerick City, Fine Gael)
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I assume that the Deputy is referring to the employer PRSI charge on share based remuneration introduced by the previous Government, which I abolished as part of the recent Jobs Initiative. Following the announcement that I made on the 18 March 2011, which clarified that PRSI would only apply to share based remuneration that was subject to a written agreement entered into after 1 January 2011, it was estimated that the employer PRSI element would have yielded approximately €1.8 million in 2011. In my view, the introduction of the employer PRSI charge, by increasing costs for employers, had the potential to seriously damage the economy, particularly in terms of making Ireland less attractive for foreign direct investment, as many FDI firms use share based remuneration schemes. While it is not possible to estimate the number of jobs that will be protected, or created, as a result of the abolition of the charge, the danger of job losses or a reduction in our attractiveness for investment, far outweighed the yield that could be achieved from it.

Willie O'Dea (Limerick City, Fianna Fail)
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Question 118: To ask the Minister for Finance the measures that have been taken to verify that the VAT reductions on certain goods and services from 13.5% to 9% have been passed on to consumers; the estimated rate of compliance by business in reducing prices in accordance with the VAT reduction and the estimated loss of revenue to the Exchequer. [25990/11]

Michael Noonan (Limerick City, Fine Gael)
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As announced under the Jobs Initiative, a second reduced VAT rate of 9% was introduced on a temporary basis in respect of certain services and goods mainly related to tourism for the period 1 July 2011 to end 2013. Specifically the 9% rate applies to restaurant and catering services; hotel and holiday accommodation; various entertainment services such as admissions to cinemas, theatres, certain musical performances, museums, art gallery exhibitions and fairgrounds/amusement parks, the use of sporting facilities; hairdressing services; and printed matter such as brochures, maps, programmes, leaflets, catalogues, newspapers and magazines. The introduction of the 9% VAT rate is aimed at contributing towards boosting tourism and the creation of additional jobs in that sector. The measure has received a very positive response from the tourism sector and a recent press release from the Restaurants Association of Ireland, for example, reports the passing on of the new rate by the majority of members surveyed. Of course compliance by business in reducing prices is key to the success of the initiative and this will be kept under review and will be evaluated before end 2012 in order to determine its effectiveness in aiding the industry. If it is shown that the VAT reduction has little or no effect in aiding the industry then the measure is open to being reformed or abolished. In addition, checks on the correct operation of VAT, including the rates of VAT applied are integral parts of Revenue's audit and compliance programmes.

The measure is estimated to cost €120 million this year and €350 million in 2012 and 2013.