Noonan accused of 'cheap shot' over jibe about builders
FINANCE Minister Michael Noonan is bringing in two significant changes to improve his Budget-day tax break for homeowners who carry out renovations on their houses.
But he has also been accused of taking "cheap political pot-shots" by suggesting that builders in Donegal are "night and day working in the black economy".
Mr Noonan is lowering the threshold for homeowners to qualify for the home-renovation tax break to €5,000.
The minister has also extended the deadline for larger renovation jobs right up until March 2016 -- the expected time of the next general election.
Mr Noonan was appearing before the Oireachtas Finance Committee to discuss the Finance Bill when he tabled the significant changes.
On the tax breaks, Mr Noonan announced that he wants to lower the threshold for tax breaks to homeowners undertaking renovations, following lobbying from the opposition.
On Budget day, Mr Noonan said renovations or improvement works to primary residences would qualify for a lower VAT rate of 13.5pc
But during committee stage discussions on the Finance Bill, Mr Noonan said the new threshold would be €5,000 exclusive of VAT, down from €5,675.
This means that a homeowner who conducts €5,000 in renovations will save €675 as they will be charged at the lower VAT rate of 13.5pc, rather than the top rate of 23pc.
However, the minister's changes are likely to have more of an impact on those middle-class homeowners who seek to undertake large extensions on their houses. Under the terms of the proposal, any job costing more than €30,000 will attract the maximum credit of €4,050.
To qualify, work must have commenced after October 24 this year and be completed during 2014 and 2015.
Mr Noonan is now allowing jobs with planning permission granted until March 31, 2016 to conclude and benefit from the tax break.
"Where qualifying expenditure is incurred between January 1, 2016 and March 31, 2016 in respect of works where planning permission has been granted before December 31, 2015, this expenditure will be regarded as if it had taken place in 2015 and tax relief will be available," the Department of Finance note said.
Mr Noonan explained that homeowners can aggregate small jobs together in order to reach the threshold, but that he did not consider it appropriate that "normal repairs" be included in the scheme.
But Mr Noonan was also involved in a row over comments on Donegal builders. The minister claimed he was drawing on earlier comments from Sinn Fein's Pearse Doherty and Independent TD Richard Boyd Barrett.
However, Mr Doherty became visibly angry at the suggestion that he had said small builders in Donegal were primarily working in the black economy, telling Mr Noonan: "You are trying to misrepresent me."