The Government plans to withdraw property-based tax reliefs from this month have been placed on ice, with the removal not now expected until the next tax year.
The Finance Bill, published this afternoon, had originally been expected to give effect to the withdrawal of a number of property-related tax shelter reliefs. While it does contain the withdrawal provisions, the Bill will not give effect to them because the Government has decided they merit an economic impact assessment before coming into application.
This means they may now "only take effect in the next tax year".
The property-based tax issue has been the subject of intense lobbying, with many property investors arguing that the new measures would leave them facing a choice between their tax bill and bankruptcy.
The Government has also chosen not to include in the Bill specific measures relating to the tax treatment of controversial bank bonuses, although it is expected these will come as amendments as the Bill progresses through the enactment process.
Similarly, measures relating to the tax effects of Civil Partnership are expected to be inserted at a later stage, rather than being included today.
The Finance Bill gives effect to the Budget and, as such, contains most of the income tax changes contained in the Government's National Recovery Plan. The successful enactment of the Bill is viewed as a key stage to pass under the terms of the EU/IMF bailout.
Among measures introduced for the first time today is a shift in the date for payment of preliminary income tax from October 31st to September 30th, in the year involved. The date for payment of the balance of tax for the previous tax year and the submission of a tax return for that year is also being brought forward, again from October 31st to September 30th.
The Government made a similar change last year in relation to Capital Acquisitions Tax.
The Revenue Commissioners will gain new powers under the Bill's provisions, notably in relation to false claims for tax relief or tax credits. Penalties will now apply to such situations, while Revenue will also pursue recovery of tax refunded on the basis of a false claim.
On a somewhat positive note for taxpayers, the Bill contains a provision allowing them to pay their taxes and duties with a credit card. This is aimed at "facilitating voluntary compliance", as well as providing greater flexibility.
Less positively for punters, the Government has decided that betting duty should be extended to include online betting and betting exchanges.
Revenue will also soon be able to publish the names of tax defaulters before the sum owed has been agreed and paid. The Department of Finance said some taxpayers had "persistently" resisted or refused liability in the knowledge that this meant their name could not be published.
The Bill also tackles the issue of companies within the same overall group borrowing funds from each other. The Bill states that relief will not generally be allowed in respect of interest on intra-group borrowings to finance the purchase of assets from another group company. Neither will such interest be allowed as a deduction in computing profits or gains of a trade.
Among other new measures are provisions in relation to the R&D tax credit, the treatment of electric vehicles, the deliberate reduction of point-of-sale records and tax confidentiality.
As well as formalising increased consumer charges contained in the Budget, the Bill proposes to raise the private insurance health levy from €185 to €205 for adults and from €55 to €66 for those aged under 18.
This will apply to all policies opened or renewed after the start of this month. The increase is necessary, according to the Government, to balance against an increase in private health insurance tax relief for those over 60 to 65 per cent of the additional cost of healthcare. Health insurance age-related tax relief at source for those aged under 60 is being abolished.
