Gerald Nash (Louth, Labour)
Link to this: Individually | In context | Oireachtas source

329. To ask the Minister for Finance the number of persons who availed of the cycle to work scheme in each of the years 2017 to 2020 and to date in 2021; the cost of the scheme in each of the years; the number of persons who accessed the maximum amount of tax relief in each of those years; the average tax relief in each year; and if he will make a statement on the matter. [39878/21]

Gerald Nash (Louth, Labour)
Link to this: Individually | In context | Oireachtas source

330. To ask the Minister for Finance the estimated savings to the Exchequer by decreasing the current tax relief on bike to work schemes to €500; and if he will make a statement on the matter. [39879/21]

Paschal Donohoe (Dublin Central, Fine Gael)
Link to this: Individually | In context | Oireachtas source

I propose to take Questions Nos. 329 and 330 together.

As the Deputy will be aware, the cycle to work scheme operates on a self-administration basis. Relief is automatically available provided the employer is satisfied that the conditions of its particular scheme meet the requirements of the legislation. There is no notification procedure for employers involved. This approach was taken with the deliberate intention of keeping the scheme simple and reducing administration on the part of employers. Accordingly, there are no records available on the number of people availing of the scheme.

Tax expenditure reports prepared by my Department have estimated the full year's cost at €4 million covering an estimated 20,000 employees but have been clear that these figures were estimates as separate returns are not required. This gives an estimated average tax relief of €200 per employee.

An estimated additional tax expenditure of €0.5m in 2020 and €1.5m in 2021 is expected to arise on foot of the changes made to the scheme by Section 9 of the Financial Provision (Covid-19) (No.2) Act 2020. This increased the allowable expenditure from €1,000 to €1,500 in respect of e-bikes and €1,250 in respect of bicycles and allowed the purchase of a new bicycle every four years instead of five.

Reducing the threshold to €500 for e-bikes and bicycles could be expected to reduce the cost of the scheme per employee and could also lead to reduced uptake. A series of questions asked of Departments regarding the cycle to work scheme in June 2020 revealed an average value of bicycles of €870 purchased by civil servants. While this is not necessarily representative, it could indicate that the full threshold is not being used. Taking all factors into consideration, an estimated saving of 50% on the full year cost prior to the 2020 changes would seem reasonable.

Gerald Nash (Louth, Labour)
Link to this: Individually | In context | Oireachtas source

331. To ask the Minister for Finance the tax reliefs exempted from the high-income individual restriction; the estimated additional yield if those reliefs were not exempted; and if he will make a statement on the matter. [39880/21]

Paschal Donohoe (Dublin Central, Fine Gael)
Link to this: Individually | In context | Oireachtas source

I am advised by Revenue that the list and estimated cost of the relevant reliefs that are subject to the High-Income Individuals’ Restriction (HIIR) for 2018 (the latest year for which data are available) can be found in the High Income Individuals’ Restriction Reportwhich is available on the Revenue website.

As stated on page 6 of that report, normal business-related expenses, deductions for capital allowances on plant and machinery, business-related trading losses and losses from a rental activity that do not arise from the use of specified reliefs are not restricted. In addition, personal tax credits are not affected by the restriction.

I am advised by Revenue that it is not possible to assess the implications of the extension of the restriction to other reliefs, as some reliefs may not be fully reflected in tax returns filed by the relevant individuals. Also, the purpose of the HIIR is to limit certain specified reliefs so that the relevant cohort of high income taxpayers is paying a minimum effective rate of tax. The HIIR analysis published by Revenue indicates that this outcome is already being achieved.

Gerald Nash (Louth, Labour)
Link to this: Individually | In context | Oireachtas source

332. To ask the Minister for Finance the estimated yield to the Exchequer from reducing pension relief to the standard rate in 2022; and if he will make a statement on the matter. [39881/21]

Paschal Donohoe (Dublin Central, Fine Gael)
Link to this: Individually | In context | Oireachtas source

I am advised by Revenue that their most recent ‘Ready Reckoner’, which is available at: www.revenue.ie/en/corporate/documents/statistics/ready-reckoner.pdf, shows on page 10, the estimated yield from reducing the maximum tax relief available on pension contributions to the standard rate.

Based on these estimates, reducing pension relief to the standard rate of 20% and maintaining the current total earnings limit (i.e. the maximum amount of earnings that can be taking into account for the purposes of calculating tax relief) of €115,000 per year, the yield would be €423 million.