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Minister for Finance doesn't know if Leas Cross got tax breaks

21 June, 2005

"Names of beneficiaries of capital tax allowances should be published" - Caoláin

Sinn Féin Dáil leader Caoimhghín Ó Caoláin has called for the publication of names of beneficiaries of capital tax allowances which the Government claims are of public benefit. His call came after the Minister for Finance told Deputy Ó Caoláin in reply to a Dáil Question that the Revenue Commissioners could not estimate how many nursing homes have benefited from the so-called tax incentive for construction of such facilities. The Minister said the Revenue Commissioners would not be at liberty to reveal if the owners of Leas Cross availed of the tax break.

Deputy Ó Caoláin said:

"The Government is subsidising the private health sector to the tune of many millions by buying services such as places for public patients in nursing homes. In addition they are providing massive tax giveaways with no strings attached. They cannot tell us how much this costs. They will not tell us who benefits.

"The Government claims these tax giveaways are of public benefit. If so it should require, as a condition of entitlement to these allowances, that the names of the beneficiaries are published. The public will then be able to judge whether there is any real social or economic benefit from this massive uncosted spending by the Government.

"The Government has failed to protect vulnerable people in nursing homes. It has failed to put in place a proper system of inspection and accountability for care. At the same time it subsidises these services massively and also without proper accountability.

"What does the Government have to fear from transparency?" ENDS

Questions from Sinn Féin spokesperson on Finance and Health, Caoimhghin Ó Caoláin TD to the Minister for Finance in relation to Leas Cross Nursing home and whether it benefited from tax incentives.

289. Caoimhghín Ó Caoláin asked the Minister for Finance if the owners of the Leas Cross Nursing Home benefitted from the nursing homes tax incentive scheme; if so, the amount of tax foregone; and if he will make a statement on the matter. [19109/05]

290. Caoimhghín Ó Caoláin asked the Minister for Finance the number of persons who have availed of the nursing homes tax incentive scheme; the cost of this scheme to the public finances; and if he will make a statement on the matter. [19110/05]

Minister for Finance (Mr. Cowen): I propose to take Questions Nos. 289, 290 together.

The Revenue Commissioners are not in a position to estimate the number of nursing homes which have benefited from this tax incentive. This is because the normal self-assessment tax return form does not distinguish between capital allowances claimed in respect of private nursing homes from those claimed in respect of other buildings entitled to capital allowances.

Consequently it is not possible for Revenue to indicate the level of take-up of this specific incentive. With regard to this issue my Department and the Revenue Commissioners have been working closely recently to investigate data capture issues with a view to improving data quality and transparency without overburdening compliant taxpayers. Arising from this work, provisions were included in Finance Act 2004 introducing a number of changes to the tax return forms which will yield additional information regarding various tax reliefs. The preliminary data should become available from early 2006 after the returns for 2004 are filed in October 2005.

Capital allowances for private nursing homes were introduced in Finance Act 1998 with effect from 3 December 1997. The latest information from the Department of Health and Children is that the number of beds in private nursing homes increased from 6,932 at the end of 1997 to 13,178 in December 2003. An estimated 8,527 persons in these nursing homes receive direct exchequer support of one form or another for their fees. The new capital allowances incentive for nursing homes would have caused some of this increase in bed capacity but the Department of Health and Children does not have any information on this matter.

As regards the names of individuals who have availed of this tax relief, the Revenue Commissioners' obligation to observe confidentiality for taxpayers and small groups of taxpayers would preclude them from giving this information, if this were available to them.

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