Other Income Tax

All items take effect from 1 January 2005 unless otherwise stated.

• Comprehensive review of all tax reliefs and exemptions.

• Extension of special tax exemption for unemployment benefit for systematic short-term workers for a further two years to 31 December 2006.

• The maximum level of rent paid for private rented accommodation, on which tax relief at the standard rate can be claimed:

• Increase in maximum amount of qualifying fees allowable under tax relief scheme for 3rd level fees from €3,175 per annum to €5,000 starting with the academic year 2005/2006.

• Increase in small Benefits-in-Kind (BIK) exemption threshold from €100 to €250.

Stamp Duty

• Major relieving measures in the stamp duty charge for first-time buyers who are owner-occupiers of second-hand residential property.

No Stamp Duty on second-hand houses up to €317,500

Reduced Rates up to €635,000

• Stamp Duty relief from the double charge arising from switching financial cards such as credit, charge, ATM and laser cards.

• Halving of rate of companies capital duty – a duty charged on the issuing of share capital – from 1.0% to 0.5%.

Indirect Taxation

• No increase in Excise Duties on alcohol, petrol diesel or tobacco.

• Extension of scheme providing purchasers of “hybrid” vehicles with a 50% refund on VRT for a further two years until December 31 2006.

• Reduction of 50% of the standard rate of Alcohol Products Tax applying to beers produced in microbreweries from 1 January 2005.

• As an environmental measure, an excise differential for sulphur free petrol along the lines of that introduced for sulphur free diesel in Budget 2002 will be introduced during 2005.

Farmer Taxation

• Writing down period of the special tax relief scheme for expenditure on farm pollution control measures reduced from 7 to 3 years to assist farmers in complying with EU Nitrates Action Programme.

• Farmers/Flat Rate VAT Addition raised from 4.4% to 4.8%.

• Stock Relief for farmers (including young trained farmers) extended for a further two years from January 1 2005.

• The Finance Bill 2005 will provide a stamp duty relief for exchanges of farmland between farmers for farm consolidation purposes by applying the duty only in respect of an amount equal to the difference in value of the lands concerned.

• The Finance Bill 2005 will also include a provision enabling farmers to average in 3 equal instalments over the years 2005-2007 for income tax purposes certain FEOGA direct payments for 2004 paid in 2005.

SOCIAL WELFARE

The Government's overall strategy is to secure economic growth on a sustainable basis so as to generate the resources to address the needs of society. The needs of the most disadvantaged have a particular claim on the collective resources. One of the principal means of meeting these responsibilities is through the social welfare system. The improvements in social welfare payments announced in this Budget amount to an additional €874m in a full year.

(From January 2005, except where stated)

• Maximum personal rates for old age and related pensions increased by €12 per week.

• Other maximum personal rates increased by €14 per week.

• Increase of €14 per week in minimum rate of Maternity Benefit, and for those above the minimum rate, an increase in the rate payable from 70% to 75% of reckonable earnings.

• Family Income Supplement income thresholds increased by €39 per week.

• Child Benefit to increase by €10 (1 st and 2 nd children) to €141.60 per month and by €12 per month (3rd and subsequent children) to €177.30 from April 2005.

• Increase in amount of capital disregarded for means test purposes for all schemes (except Supplementary Welfare Allowance) to €20,000 from June 2005.

• Increase in Respite Care Grant to €1,000 from June 2005 and the grant to be payable to an estimated 9,000 new claimants.

SERVICES FOR PEOPLE WITH A DISABILITY

For 2005, the Abridged Estimates Volume published on November 18 provided for increased resources of €290m for disability specific services. €75m is being allocated to these services from within the revised capital envelope for 2005 announced in the Budget. In addition, a multi-annual investment programme is being introduced to support the development of high-priority disability support services over the period 2006-2009. In cumulative terms, this will involve almost €600m current spending and €300m capital spending over these four years. This funding will provide:

• An extra 255 residential , 85 respite and 535 day places each year for persons with an l disability and those with autism, on top of the extra 270 residential, 90 respite and 400 day places in 2005, giving a total of 1,290 new residential, 430 new respite and 2,540 day places.

• An additional 80 resdidential places each year for persons with physical or sensory disabilities, on top of 60 new places in 2005, giving a total of 380 new residential places.

• 250,000 extra hours of home support and personal assistance each year to support independent living for persons with a disability, on top of an extra 200,000 hours in 2005, giving a total of 1.2m extra hours.

• 100 new places each year in community-based mental health facilities, giving a total of 400 extra places.

• Enhanced adult and pre-school facilities.

• Improved accessibility to public buildings and amenities.

*Footnote Status of Taxation Measures

It is important to note that, in general, taxation measures outlined in the Financial Statement and associated documents and not included in the Financial Resolutions under the Provisional Collection of Taxes Act 1927 are given legislative effect through enactment by the Oireachtas of the Finance Bill 2005. Changes may arise during this legislative process. They may also arise if EU State aid issues are involved and the European Commission requires these changes before it gives its approval.