Government publishes Finance Bill

Bill gives effect to measures announced in budget, including increased savings tax and new jobs incentives

Minister for Finance  Michael Noonan at Government Buildings before delivering the Budget to the House. Photograph: Bryan O’Brien /The Irish Times.

Minister for Finance Michael Noonan at Government Buildings before delivering the Budget to the House. Photograph: Bryan O’Brien /The Irish Times.

Thu, Oct 24, 2013, 15:10

The Government has published the Finance Bill, which gives effect to measures announced in the Budget last week that include tax relief for home renovations, the reduction of the air travel tax and an additional levy on pension funds for 2014.

As part of the Budget 2014 measures, the Government announced 25 pro-business and pro-jobs initiatives, which are set to cost more than €500 million. This will be funded by almost €700 million of new tax measures.

Those new measures included increased taxation on savings interest, reduced medical insurance relief and the abolition of top slicing relief for all ex-gratia payments made on or after January 1st, 2014.

Under the Bill, the 9 per cent VAT rate will be retained for the tourist industry, a measure that the industry had lobbied hard for in the run up to the Budget.

Mr Noonan said the commencement date for the home renovation incentive was being brought forward to include works that commence from October 25th, providing relief at a rate of 13.5 per cent relief on qualifying expenditure of a minimum of €5,000 before VAT and a maximum of €30,000. Those availing of the scheme will see the credit awarded in 2015 and 2016.

The increased rate of DIRT, which will stand at 41 per cent, is provided for in the Bill.

The Bill also puts in place the structure for the Start Your Own Business incentive scheme and extends the relief for the film industry.

The Bill provides for a number of measures not announced on Budget Day, including enhanced double taxation relief in respect of leasing income that is set to benefit the aircraft leasing industry, and the removal of the 50 per cent restriction on the amount of prior year trading losses a Nama participating institution - AIB and Bank of Ireland - can set off against trading profits. That measure will help reduce the risk of future capital injections by the State that may arise from upcoming stress tests.