Home Politics Minister Donohoe publishes Finance Bill 2018

Minister Donohoe publishes Finance Bill 2018

113
0
SHARE

 

The Minister for Finance, Paschal Donohoe T.D., today (Thursday), published Finance Bill 2018

Finance Bill 2018, which runs to 61 sections, implements the taxation changes announced on Budget Day as well as introducing some necessary anti-avoidance measures and technical changes to the tax code.

The Bill provides for the Budget Day announcements of a reduction to 4.5% in the 4.75% rate of USC, an increase to the ceiling of the band on which the 2% rate of USC will be payable, an increase in the income tax standard rate band, the increase in the home carer tax credit and the earned income tax credit. The Bill also provides for the change in the 9% VAT rate for hotels, restaurants and a range of other services to 13.5%, as well as an increase in the excise duty on cigarettes of 50 cents.

In line with the Budget Day announcement, the Bill introduces changes to the KEEP incentive (Key Employee Engagement Programme) on the exercise of the share options by employees, as well as significant reforms in the administration of the Employment and Investment Incentive (EII) and Start-up Refunds for Entrepreneurs (SURE) schemes. Provision is also made in the Bill for enhancements to the Film Relief Scheme including the extension of the scheme to end-2024 and introducing a regional uplift.

In line with the recently published Roadmap on Corporate Taxation, the Bill provides for the introduction of a Controlled Foreign Company (CFC) regime as required by the EU Anti-Tax Avoidance Directive (ATAD). CFC rules are an anti-abuse measure, designed to prevent the diversion of profits to offshore entities (the CFCs) in low- or no-tax jurisdictions.  The Bill also provides for the introduction of a new ATAD-compliant exit tax regime as announced in the Budget. The rate for the new regime is 12.5%.

Further changes to VRT rates for diesel cars and preferential regimes for hybrid and electric vehicles are also provided for in the Bill including the introduction of a new fixed term VRT scheme for certain leased or hired vehicles on foot of a European Court of Justice ruling.

Commenting on the publication of the Bill, Minister Donohoe stated that: ‘The Finance Bill 2018 sets out the legislative provisions to bring effect to the tax measures announced in Budget 2019 as we build resilience in our economy and work to further support its long term growth. We are doing this by balancing the books, making steady and sustainable investment in day to day services and putting money back in people’s pockets in a way that is affordable for the State. The Bill also contains a number of anti-avoidance and administrative changes to the tax code in order to protect and enhance the integrity of our tax base.  I look forward to bringing this important legislative instrument through the Oireachtas over the coming weeks’.

LEAVE A REPLY

Please enter your comment!
Please enter your name here