Written answers
Monday, 9 September 2024
Department of Finance
Tax Reliefs
Mairead Farrell (Galway West, Sinn Fein)
Link to this: Individually | In context | Oireachtas source
317.To ask the Minister for Finance if the introduction of tax incentives for philanthropic activities is being considered as outlined in the national philanthropy policy; and if he will make a statement on the matter.[34104/24]
Jack Chambers (Dublin West, Fianna Fail)
Link to this: Individually | In context | Oireachtas source
As the Deputy will be appreciate, it is a longstanding practice of the Minister for Finance not to comment in advance of the Budget on any tax matters which might be the subject of Budget decisions.
Gerald Nash (Louth, Labour)
Link to this: Individually | In context | Oireachtas source
318.To ask the Minister for Finance the cost in each year since 2016 of the relief for increase in carbon tax on farm diesel, and the number of claimants in each year, in tabular form; to confirm that farmers can claim a double relief on this cost as it will already be deducted against profits for expenditure on farm diesel; if such a relief for carbon tax applies to any other sector; and if he will make a statement on the matter.[34123/24]
Jack Chambers (Dublin West, Fianna Fail)
Link to this: Individually | In context | Oireachtas source
Section 664A of the Taxes Consolidation Act 1997 provides for relief in the form of a deduction for the expenditure on the carbon tax incurred on the purchase of farm diesel. The relief is available to those persons carrying on a trade of farming (an individual or a company) and is not available in respect of expenditure on carbon tax on fuels other than farm diesel. Finance Act 2012 provided for the “double deduction” procedure.
In computing profits of a farming trade, a farmer may claim an income tax or corporation tax deduction for farm diesel that is equal to the difference between the carbon tax charged and the carbon tax that would have been charged had it been calculated at the rate of €41.30 per 1,000 litres (this was the rate applicable from 1 May 2010 when carbon tax was introduced and applied until 30 April 2012). The farmer is also entitled to claim a deduction for expenditure on the farm diesel (including the carbon tax charged in respect of the diesel).
By way of example, for the accounting period ended 31 December 2024, a farmer carrying on a trade of farming is entitled to a deduction for the cost of 10,000 litres of farm diesel used in the course of the trade. The farm diesel cost €7,500 and this included carbon tax of €1,518.10 (based on the rate of €151.81 per 1,000 litres). In accordance with the relief for increase in carbon tax on farm diesel, the farmer is entitled to a deduction in the amount €1,105.10, which is the difference between the carbon tax included in the cost of the farm diesel (i.e. €1,518.10) and the carbon tax that would have been included in the cost if the rate had remained at €41.30 per 1,000 litres (i.e. €413). In computing profits of the farming trade, the farmer is also entitled to a deduction in the amount €7,500 for the cost of the farm diesel.
The first year in which data is available in respect of the relief is 2020; I am advised by Revenue that data for the 2023 tax year is not yet available. The cost of the relief claimed and the number of claimants per year is as follows:
- | 2022 | 2021 | 2020 |
---|---|---|---|
Number of taxpayer units | 5,600 | 5,800 | 5,900 |
Tax cost | €0.3M | €0.2M | €0.1M |
Further information on the relief is available on the Revenue website at: www.revenue.ie/en/tax-professionals/tdm/income-tax-capital-gains-tax-corporation-tax/part-23/23-01-36.pdf
In relation to the final part of the Deputy's question, a relief for carbon tax of this type does not apply to non-farm sectors.
No comments