Seán Fleming (Laois-Offaly, Fianna Fail)
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189. To ask the Minister for Finance if he will provide details of the handling by the Revenue Commissioners of super levy fines imposed on farmers in 2015; if these fines can be set-off against the farmers' income in their accounts this year; and if he will make a statement on the matter. [29905/15]

Michael Noonan (Limerick City, Fine Gael)
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I am advised by the Revenue Commissioners that payments made by dairy farmers in respect of milk quota super levy (under SI 227 of 2008, as amended and Council Regulation EC 1234/2007, as amended) are classified as an expense of the trade.  As such, the super levy is tax deductible in the year in which the expense is recognised in the farmer's accounts.

Terence Flanagan (Dublin North East, Independent)
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190. To ask the Minister for Finance his views on the capital acquisitions tax thresholds; his plans to increase the thresholds; and if he will make a statement on the matter. [29946/15]

Martin Heydon (Kildare South, Fine Gael)
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199. To ask the Minister for Finance his plans to review the caps and thresholds of the capital acquisition tax system given the increase in property prices which means that family members can now incur significant tax bills if they wish to retain their original family home in the family when it is not their principal private residence; and if he will make a statement on the matter. [30089/15]

Michael Noonan (Limerick City, Fine Gael)
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I propose to take Questions Nos. 190 and 199 together.

This issue has been raised with me by Deputies and others in recent months and I am conscious of the concerns involved.

Capital Acquisitions Tax applies to the beneficiary of a gift or inheritance rather than to the person making the gift or inheritance. While the rate of CAT is 33% each person has a number of life-time thresholds for gifts and inheritances which they can receive tax free. These are based on the relationship to the person who has made the gift or bequest.

The Group A threshold of €225,000 applies primarily in cases where an asset passes from a parent to a child. The Group B threshold of €30,150 applies primarily to transfers between other close relatives. The Group C threshold of €15,075 applies between more distant relations and people who are not related.

The 33% rate of CAT applies on assets received by a person above the relevant threshold. Gifts and inheritances between spouses and civil partners are exempt from CAT. 

Over the last number of years the CAT thresholds have been reduced a number of times, while the rate has been increased. These changes were necessary in order to maintain the yield from capital taxes in a period of falling asset prices so that such taxes would continue to make a contribution to our efforts to consolidate the public finances. Moreover, the views of the OECD, supported by our own economic research, is that taxes on property and other fixed capital, such as CAT, are less harmful and distortionary to economic growth than taxes on work or consumption. As the economic recovery continues to take hold, I began this year to focus available resources on reducing the burden of taxation on earned income and take-home pay where high taxes impact on competitiveness, economic growth and job creation. That will continue to be my main focus.

That said, I do recognise that recent growth in property values has implications for the liabilities that can arise from capital acquisitions tax. It is for this reason that, as I have said in response to a number of other recent Parliamentary Questions on this matter, I am reviewing the various aspects of this tax in the context of the preparations for Budget 2016 and the subsequent Finance Bill.

Terence Flanagan (Dublin North East, Independent)
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191. To ask the Minister for Finance his plans to reduce the rate of deposit interest retention tax which penalises savers; and if he will make a statement on the matter. [29952/15]

Michael Noonan (Limerick City, Fine Gael)
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As the Deputy will be aware, it is standard practice for the Minister for Finance to review all tax expenditures and reliefs in the run up to annual Budgets. It is also a long-standing practice of the Minister for Finance not to comment on any tax matters that could be the subject of Budget decisions.

In recent years the DIRT rate has been increased to raise additional revenue.  The Government decided to increase the rate of Deposit Interest Retention Tax (DIRT) (previously 33%) to 41% in Budget 2014.  The higher rate of DIRT (previously 36%) for interest paid less frequently than annually was  abolished, and  all deposit interest is now liable to DIRT at the same rate (41%).

Up to 2009, individuals may have been taxable on other income at the higher rate of income tax but were only liable to pay tax on interest income at 20%.Previous DIRT rates were below the higher rate of income tax, and this, in effect, incentivised saving. The decision to raise the rate of DIRT was taken to encourage spending in the economy with a view to stimulating growth and employment.

Certain exemptions apply from DIRT, the main ones include -

- Individuals aged over 65 (subject to income limits)

- Permanently Incapacitated Individuals

- Companies, Pension Funds and Charities (Irish resident companies pay tax on investment income at 25%)

- Non-Resident Account Holders.