Category: Government

New tax to hit teenagers!

Legislation is being drafted by the (acting) Government to allow Revenue to implement a new tax starting on 1st July 2016. This tax will be a charge per keystroke on a mobile phone and it is expected to be a money winner for the (acting) Government. The only other country in the world with a similar tax is Japan where it has been successfully in operation for two years.

The way the tax works is this: if you send a text consisting of eight words with an average of five keystrokes per word (plus spaces), you will be taxed on having used 48 keystrokes. The rate at which the tax will be charged will be determined by the (acting) Minister for Finance, Michael Noonan, but will probably be €0.0002 per keystroke. So for 20 text messages of eight words as above the tax will be €0.19.

As teenagers send the most texts they will be hardest hit by the new tax. An average teenager sends 100 texts in a three minute period consisting of between five and 20 words. Over a sixty minute period this works out at €24. If you have ever seen students going to school or college, every single one of them is on their mobile phone – all the time!

It is proposed that the tax will be collected by adding it onto your phone bill, effectively making the phone companies tax collectors! Needless to say, the phone companies are not in favour of this tax.

The (acting) Minister for Health, Leo Varadkar, is fully supporting the new tax. Repetitive Strain Injury is becoming a real menace in our younger generation as thumbs are used for texting, with the added health hazard of the early onset of arthritis from the age of 23.

A percentage of the finance raised by the new tax will be returned to the Health Service to treat withdrawal symptoms as it is expected there will be a mass reduction of texting by teenagers. There will also be nationwide workshops on the lost art of verbal communication which is currently in danger of becoming extinct. As a pre-requisite for these workshops, Question 15 on the Census form for 24th April 2016 is “Can you communicate – Very well, Well, Not well, Not at all.”

More information about the new tax will be released by Revenue later this month.

Information moratorium until 1st April 2016.

This is a new code that addresses the late payment culture in the UK. It is a government initiative that is trying to encourage bills to be paid within 30 or 60 days of invoice. A new website went live in March 2015 and encourages companies to sign up to the code. Large company signatories are being asked to start half-yearly reporting from the summer 2015 on their payment performance information and all companies will be required to report from April 2016.

Will it make a difference? A recent survey conducted by the Federation of Small Businesses (in the UK) found that only one in five (21%) of members are confident that the code will be enough to address the UK’s poor payment culture. The top five reported reasons why their customers are paid late were:

(1) No excuse or justification was given;
(2) Internal invoice processing issues caused a delay;
(3) The customer extended the payment terms without consent;
(4) Invoice was lost or misplaced: and
(5) Invoice was never received.

Any ideas here for Ireland???

Yes the New Companies Act has finally come! After many years of waiting the Act has been signed into law and we have the most comprehensive overhaul of company law since our state was founded. Every limited company will be affected. Every director, company secretary, auditor, member and many others will be affected. For your information, there will be PLCs, DACs, UCs, PULCs, CLGs, ULCs as well as LTDs. Now – don’t you feel better knowing all that?

But don’t put your head in the sand. It will be necessary for each company to see what type of new company structure best fits their purpose and make the necessary changes. There will be an 18 month transition period from the date the Act is commenced (expected to commence on 1st June 2015).

Then forms will need to be filled in and changes made to your corporate structure. Information is still a bit sparse but check the Companies Act 2014 for more details as they become available.

By the way – changes will apply to charities too under this legislation.

These are the facts, the accurate facts, not the embellished facts, not the political facts, not the opportunistic facts, but the accurate facts.

Glass of water 11.12.14
The Dáil has passed an Act called the Water Services Act 2013 which set up Irish Water as a semi-state body. This body will charge:

• Each person who uses the public water system, and / or
• Each person who uses the public waste water system,

a sum of money which will be used for maintaining and improving our drinking and waste water systems.

When will charging start? Charging will start from 1st January 2015 with the first bills being issued to customers in April 2015.

How much will the charge be? Water services charges are capped at a maximum annual amount of €160 / €260 shown below until the end of 2018. Water services for children under the age of 18 are free.

For those who do not have a water meter:

Household* Water supply and wastewater services Water supply or wastewater services
1 Adult
€160 per year
€80 per year
2+ Adults
€260 per year
€130 per year

For those who have a water meter:

The charge will be based on the usage as recorded by the meter. The charge will be €1.85 per cubic metre (1,000 litres).

Household* Water supply and wastewater services Water supply or wastewater services
1 Adult
€1.85 per cubic metre
€1.85 per cubic metre
2+ Adults
€1.85 per cubic metre
€1.85 per cubic metre

When a domestic property is not permanently occupied the “not permanently occupied” charge applies.

Household* Water supply and wastewater services Water supply or wastewater services
not permanently occupied
€1.85 per cubic metre
€62.50 per year

* A household is taken as meaning a housing unit – house, apartment, flat.drops 11.12.14

Water Conservation Grant: There will be a water conservation grant of €100 per year that will be available for all primary residences of customers who apply to Irish Water, payable through the Department of Social Protection. The grant will be paid to the registered householders annually in respect of their primary dwellings, with the first payment to be paid in September 2015 and each subsequent year up to and including 2018.

The Department of Social Protection will be communicating with people in the middle of 2015 inviting them to apply for the Water Conservation Grant.

What about water meters? These are being installed by contractors on behalf of Irish Water outside your property on the public path or road. The contractors will not need to enter onto your property either with or without your permission. The meters are the property of Irish Water and any deliberate interference or damage to them is therefore illegal.

The meters will be used to show how much water is used by the household and the charge will be based on this.  The meter will also show water leakage or wastage and it is known that in Ireland our unaccounted water amounts are up to 48%.

Is the water charge a tax? Strictly speaking no. It is a charge for a service just like the electricity or gas. You cannot claim any tax allowances for water charges.

Do landlords or tenants pay? In the case of tenants in private rented accommodation, legislation will be introduced to insert into all tenancy agreements/leases a deemed obligation on the tenant to discharge their liability for water charges. If the tenant has not registered with Irish Water the landlord will be able to put the tenant’s name forward to Irish Water. If the tenant does not pay the landlord does not have to pay the bill and any outstanding bill may be taken by the landlord from the tenant’s deposit and sent to Irish Water.

Landlords will be able to charge any water charge they pay against their rental income just like other utility bills that they pay.

If I say I won’t pay: Irish Water have said that no water will be cut off for non-payment but that water pressure will be reduced. Late payment provisions shall automatically apply, unless the customer enters into a payment plan.

However, my tax business is based on the principles of the Holy Bible and it is stated there that we should obey the law and pay what is due. (Matthew 22:2)

drip&drop 11.12.14
If I don’t agree with the charge: We are a democratic country. The Water Act was passed into law by the representatives that we, the people, elected to run our country. If you want to change the law then the process is to contact your TD and get him or her to do it through the Dáil. That is what they are elected to do.

We do not rule by demonstrations that have as their stated aim to topple the Government or by elected TDs who encourage us to break the law and not pay the charge.

Background Information: Incorporated in July 2013, as a semi-state company under the Water Services Act 2013, Irish Water is bringing the water and wastewater services of the 34 Local Authorities together under one national service provider.

Irish Water is gradually taking over the responsibilities from these Local Authorities on a phased basis from January 2014. It will take approximately five years for Irish Water to be fully established, at which point it will be responsible for the operation of public water services including management of national water assets, maintenance of the water system, investment and planning, managing capital projects and customer care and billing.

As well as responsibility for public water services, Irish Water will also be making capital and investment decisions regarding the country’s water infrastructure on a national basis.

Irish Water will be accountable to two regulatory bodies – the Commission for Energy Regulation (CER) who is the economic regulator for the water industry, and the Environmental Protection Agency (EPA) who is the environmental regulator.

Irish Water is a registered subsidiary company of Bord Gáis Éireann.