Brendan Griffin (Kerry, Fine Gael)
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140. To ask the Minister for Finance if the Revenue Commissioners' policy on interest penalties for the self-employed can be reviewed in view of the burden it is putting on small businesses; and if he will make a statement on the matter. [28338/16]

Michael Noonan (Limerick City, Fine Gael)
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Section 1080 of the 1997 Taxes Consolidation Act provides for the charging of interest on the late payment of Income Tax. The current rate applied to such late payments is 8% per annum (0.0219% per day). This rate also applies to Corporation Tax, Capital Gains Tax, Capital Acquisition Tax, Local Property Tax and Stamp Duty. The interest rate applied to all other taxes, for example PAYE/PRSI and VAT is 10% per annum (0.0274% per day).    

 These statutory charges, which Revenue is obliged to apply, are designed to compensate the Exchequer for the late payment of monies due and to maintain a level playing field for the vast majority of taxpayers and businesses that meet their tax obligations in full and on time. The application of interest charges to the late payment of tax is well established as a core strategy for ensuring timely compliance by all sectors, including the self-employed, and I have no plans to review it at this time. The onus is on all taxpayers and businesses, assisted by their agents or tax practitioners, to organise their financial affairs to ensure that tax debts are paid as they fall due thereby avoiding interest charges.

While Revenue is obliged to collect all tax and interest liabilities as they fall due, it recognises that despite the best efforts of normally complaint taxpayers, including the self-employed and small businesses, difficulties can arise that result in failure to meet tax payment obligations. In such scenarios Revenue s overall approach is to work with the taxpayers to overcome these difficulties, including in appropriate cases agreeing to phased payment arrangements. This strategy has worked well over many years and Revenues' ongoing commitment in this regard is clearly evidenced by the almost 8,500 phased arrangements covering €96m of debt that it currently has in place with taxpayers experiencing cash flow difficulties.