The Government has rejected a suggestion to make M50 toll payments tax deductible for commuters who rely on the motorway for their daily commute.
In a parliamentary question this week, Fine Gael TD Emer Currie if the Government would consider such a measure.
Her party leader and Tánaiste Simon Harris replied: “I have no plans, at present, to introduce the measure along the lines proposed by the Deputy.”
He explained that individuals have a choice of how they travel to work, and that they would choose the most favourable one for their situation.
“While I appreciate that some people use cars to travel to their principal place of employment, ultimately it is a matter for individuals to choose the transport option that works best for them, taking into account certain tax incentives which are available,” he said.
“For example, in order to encourage the uptake of more sustainable and environmentally friendly transport options, persons commuting to work can already avail of the TaxSaver scheme in respect of public transport; and the cycle to work scheme.”
He explained that while travel expenses incurred in the performance of their duties could be claimed back in tax, “these deductions do not ordinarily include the cost of travelling to and from a principal place of work.”
“It is a long-established principle of tax case law that the expenses incurred in travelling from home to work and work to home are expenses which are not necessarily incurred in the performance of the duties of an office or employment,” he said.
“The reimbursement to an office holder or employee of such expenses is therefore taxable and subject to PAYE deductions.
“…As the Deputy will appreciate, decisions regarding taxation measures are made in the context of the annual Budget and Finance Bill processes, at the appropriate time, and having regard to the sound management of the public finances.”
He said that there was already an exemption from “benefit-in-kind” where an employer purchases a travel pass for an employee, explaining that “an employer and employee may also enter into a Revenue-approved salary sacrifice arrangement under which the employee agrees to sacrifice part of his or her salary, in exchange for the benefit.”
“It is important to note that employers are not required to take part in the Taxsaver scheme,” he said.
“Where an individual’s employer does not participate, any benefits that could arise under the scheme will not be available to any employees of that employer.
“If an employer does participate in the scheme, they will also save money as employer’s PRSI is not payable on the cost of the relevant benefit(s) when they make the associated deduction from their employees’ salary payments.”