TAX CONCESSIONS to encourage commuters to leave the car at home and use a bicycle to get to work are to be extended to include battery-powered bicycles, following a last-minute change to the Finance Bill.
In the Budget, Minister for Finance Brian Lenihan announced that taxpayers would be able to claim tax relief on purchases of bicycles worth up to €1,000 every five years.
However, the decision was criticised in some quarters because it did not extend as far as so-called Pedelec bicycles, which use battery power to help cyclists travel up hills or against the wind.
A number of representations were made to the Minister for Finance, and to Green Party leader and Minister for the Environment John Gormley, who urged that the tax concession be used.
Under the scheme, employers will be able to buy €1,000 worth of bicycles and safety equipment tax-free for employees every five years. If the employer pays for the bicycle, it can claim it as a tax-exempt benefit-in-kind. If the employees pay, they will save tax, PRSI and levies.
The Green Party welcomed Mr Lenihan's decision. "Yes, it is a small scheme, but it is important to people's lives," a spokesman said. "The number of bicycles being sold has increased substantially."
Up to 250,000 electric bikes were sold in Europe last year and almost half of those were battery-equipped models of the type and cost covered by the Government's move.
