Donie's Ireland daily news BLOG update

Irish revenue tax take €500m ahead of target

EXCHEQUER RETURNS SHOW A VAT SHORTFALL BUT REVENUE IS WELL AHEAD OF TARGET

     

The Irish State collected €14.04 billion in the first third of the year, €1.17 billion more than in 2015 and €475 million more than forecast by the Department of Finance.

Tax collection is running close to €500 million ahead of target this year but a VAT shortfall raises questions about the strength of consumer spending.

As political talks continue, exchequer returns from the Department of Finance point to relative strength in the public finances as a Fine Gael-led minority government prepares to take office.

Talks between Fine Gael and two groups of Independent TDs have intensified in an effort to have a new government in place by the weekend.

The Independent rural TDs and the Independent Alliance members are to be given a draft programme for government at a meeting today.

It is understood the Independents have secured concessions in the areas of health, agriculture and rural Ireland. The talks were continuing late last night.

Fine Gael sources insisted a vote for taoiseach could take place today but admitted it was more likely to take place tomorrow.

The exchequer returns will be encouraging for the new government in that the overall level of spending remains under control.

However, they also reflect the onset of pressure on the health budget, which signals potentially major problems for the incoming administration.

Year-on-year improvement.

The exchequer was in deficit by €1.055 billion at the end of April, a year-on-year improvement of €1.27 billion which was attributed to the increase in overall tax revenue.

The figures were released on same day as data showing the unemployment rate dropped in April to 8.4 per cent from 8.6 per cent in March.

The State collected €14.04 billion in the first third of the year, €1.17 billion more than last year and €475 million more than forecast by the department.

“April is not significant in terms of corporation tax receipts and is not a VAT due month . . . However, there were some significant one-off and timing factors, which have helped flatter the April tax position,” the department said.

Collections of Value Added Tax, the tax on sales, remain ahead of 2015 at €4.17 billion but the return was €161 million behind target for the first four months.

Corporation tax collections are running well ahead of profile. The €759 million out-turn in four months was €315 million or 70.8 per cent more than projected.

Income tax on target.

The collection of €6.1 billion in income tax in four months was on target, with a shortfall in earlier months recovered by a €158 million overperformance in April. The department cited “one-off payments” in April, but said the overall outturn was broadly consistent with recovery in the labour market and increased earning.

On the expenditure side, some €13.65 billion in net voted spending over four months was €89 million below target and €68 million lower than last year.

While 15 of the 16 government departments were on or under profile, health spending was €78 million ahead of target at the end of April.

This is generally seen to be a sign of a major deterioration in the health budget later this year, something that comes amid pressure on public pay and demands for additional spending in the political talks.

Total exchequer debt servicing costs in the first four months of the year reached €3 billion, down €81 million on the same period last year on foot of early IMF repayments.

Consumers now moving more to digital payments with financial services

A THIRD OF CONSUMERS WOULD LEAVE THEIR PROVIDER IF THEY DIDN’T OFFER UP TO DATE TECHNOLOGY, A NEW SURVEY FINDS

CONSUMERS ARE INCREASINGLY LOOKING FOR FINANCIAL SERVICES PROVIDERS THAT ARE EMBRACING TECHNOLOGY, TURNING TO DIGITAL AND MOBILE PAYMENTS, A NEW SURVEY HAS FOUND.

A new study, by Fujitsu, showed that more than a third of consumers would leave their provider if they didn’t offer more up to date technology, with 32% of those surveyed using mobile device payments and 22% using wearable technologies. Across Europe, on-line banking remains the most popular channel, with three quarters of customers using it once a week or more.

“Banks have no option but to embrace change,” said Anthony Duffy, senior banking technology consultant with Fujitsu UK and Ireland, noting how revenue at traditional banking institutions had fallen since the days before the economic crash.

“Doing banking as we have in the past 20 years isn’t going to be possible going forward,” said Mr Duffy. “The digital revolution has come along at the right time.”

Driving this adoption of technology is the smartphone, as people become more confident using the technology.

“People just started to recognise the convenience factor digital banking offered,” said Mr Duffy.

Banks themselves are also taking advantage of the shift, pushing people to use alternative channels such as smart ATMs and deposit machines in branches.

“Digital is transforming each and every aspect of society and this has irrevocably changed consumer behaviour. Today’s customers are no longer guarded and conventional,” said Francois Fleutiaux, Senior Vice President, Head of Country Leadership, EMEIA, Fujitsu. “Modern day consumers are ready and willing to embrace innovation when it makes interaction more convenient.”

Already in Ireland, there have been some “digital only” banks offering services to customers. But Mr Duffy said competition shouldn’t be new to Ireland’s traditional players, who are seeing supermarkets and other providers begin to offer insurance and other services to customers.

“If traditional banks want to stay in business they will have to compete and reinvent themselves,” he said.

Consumers are also more willing to buy extra services from their financial providers, the survey found, with a third open to buying energy for their home from their bank or insurer, while a similar number would also consider purchasing personal data storage from the institutions, and 30% would buy broadband.

That goes both ways though; with a fifth of consumers willing to buy their banking or insurance services from companies such as Google, Amazon or Facebook.

However, Irish people are still reluctant to move away from the established service providers. Traditional channels shouldn’t be written off either. On a Europe-wide basis, 34% of people said they visit their bank branch weekly, and 36% use phone banking, leading to the conclusion that digital is simply another way to communicate for consumers.

The survey questioned 7,000 consumers from across Europe.

About a fifth of those surveyed said they used cryptocurrencies, but that high figure was driven by Eastern European countries, where 44% said they used it.

Although much has been made of cryptocurrency such as Bitcoin in recent years, Mr Duffy said he didn’t think it would gain widespread adoption in the short term. Instead, the blockchain – the technology that underlies Bitcoin – could be more relevant as banks begin to look at the technology.

One area that looks set to evolve, however, is canticles payments as services such as Apple Pay and Samsung Pay allow people to use their phones and smartwatch to pay for goods and services.

“I think organisations like Apple and Samsung getting involved significant gives the mechanism a credibility,” he said.

However, the majority of contactless payment are still done through cards, especially in Ireland where Apple and Samsung have yet to launch their payment systems. The chief driver of adoption has been the lifting of the limit on transactions to €30, allowing contactless payments to be used for a wider range of transactions.

The ECB to stop issuing €500 note but will keep its legal status

THE €500 NOTE WAS NEVER ISSUED BY THE CENTRAL BANK IN IRELAND

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THE ECB HAS BEEN LOOKING TO GET RID OF THE €500 NOTE DUE TO CONCERNS THAT IT IS USED BY CRIMINALS AND MILITANTS TO FINANCE THEIR ACTIVITIES.

The European Central Bank will stop issuing €500 bank notes towards the end of 2018 on concerns it could facilitate illicit activities but outstanding bills will remain in use indefinitely, the ECB said in a statement yesterday.

“The €500 note will remain legal tender and can therefore continue to be used as a means of payment and store of value,” the bank said.

“The €500 banknote, like the other denominations of euro banknotes, will always retain its value and can be exchanged at the national central banks of the Eurosystem for an unlimited period of time.”

The ECB has been looking to get rid of the €500 note, despite the objections of Germany’s central bank, due to concerns that it is also used by criminals and militants to finance their activities. It is said a €1 million bundle of the notes weighs only about 2kg, a weight easily transportable across borders. The €500 note was never issued by the Central Bank in Ireland

Labrador dogs have an overeating gene problem?

A NEW STUDY SHOWS

   

A NEW STUDY SAYS AN OVEREATING GENE CAN EXPLAIN WHY SOME LABRADORS BECOME OBESE?

Labradors are often overweight because they have a gene linked to overeating, new research has suggested.

The most common breed of dog in the UK and the US, Labradors are more likely to become obese than others.

Scientists at the University of Cambridge have discovered that 23% of the loveable dogs have a variant of an obesity-related gene strongly associated with weight and appetite.

In a study published today in the journal Cell Metabolism, a team of researchers studied 310 pet and assistance dog Labradors to look for variants of three candidate obesity-related genes.

They also examined the dogs’ “food motivation” by asking owners about their animals’ relationship with food.

The researchers found that a variant of one gene in particular, known as POMC, was strongly associated with weight, obesity and appetite in Labradors and flat coat retrievers.

In both breeds, for each copy of the gene carried, the dog was on average 1.9kg heavier, an effect size particularly notable given the extent to which owners, rather than the dogs themselves, control the amount of food and exercise their dogs receive.

Lead author Dr Eleanor Raffan said: “This is a common genetic variant in Labradors and has a significant effect on those dogs that carry it, so it is likely that this helps explain why Labradors are more prone to being overweight in comparison to other breeds.

The gene affected is known to be important in regulating how the brain recognises hunger and the feeling of being full after a meal.

“People who live with Labradors often say they are obsessed by food, and that would fit with what we know about this genetic change,” says Dr Raffan.

The scientists even believe that understanding how the gene – which is also found in humans – works in dogs might help tackle the obesity crisis.

Professor Stephen O’Rahilly, Co-Director of the Wellcome Trust-Medical Research Council Institute of Metabolic Science, says: “Common genetic variants affecting the POMC gene are associated with human body weight and there are even some rare obese people who lack a very similar part of the POMC gene to the one that is missing in the dogs.

“So further research in these obese Labradors may not only help the wellbeing of companion animals but also have important lessons for human health.”

Major breakthrough in laboratory grown human embryos

  

Scientists reported today they had grown human embryos in the lab for nearly two weeks, an unprecedented feat that promises advances in assisted reproduction, stem-cell therapies and the basic understanding of how human beings form.

Scientists reported today they had grown human embryos in the lab for nearly two weeks, an unprecedented feat that promises advances in assisted reproduction, stem-cell therapies and the basic understanding of how human beings form.

Besides opening a window onto the first steps in the creation of an individual, the findings in parallel studies may help explain early miscarriages and why in vitro fertilisation has such a high failure rate.

The research also showed for the first time that newly-forming human embryos can mature beyond a few days outside a mother’s womb, something that was previously thought to be impossible.

But the widely hailed results also set science on a collision course with national laws and ethical guidelines, experts cautioned.

Up to now, a so-called “14-day rule” which says that human embryos cannot be cultured in the lab for more than two weeks — has never been seriously challenged simply because no one had succeeded in keeping them alive that long.

In this case, the scientists destroyed the embryos to avoid breaching that limit. The findings were published in Nature and Nature Cell Biology.

Next to nothing is known about how the small, hollow bundle of cells called a blastocyst — emerging from a fertilised egg which attaches to the uterus, allowing an embryo to begin to take shape.

“This portion of human development” is called implantation and “was a complete black box,” said Ali Brivanlou, a professor at The Rockefeller University in New York, and the main architect of the Nature study.

Building on previous work with mice, Brivanlou and colleagues concocted a chemical soup and scaffolding to duplicate this process “in vitro”, or in a petri dish.

“We were able to create a system that properly recapitulates what happens during human implantation,” said Rockefeller scientist and lead author Alessia Deglincerti.

As hoped, the blastocyst grew, beginning to divide into the different types of cells that eventually give rise to a foetus and its placenta.

But unlike earlier experiments, in which growth has rarely continued beyond seven days, the embryos showed an unexpected ability to self-organise.

“Amazingly, at least up to the first 12 days, development occurred normally in our system in the complete absence of maternal input,” Brivanlou said in a statement.    

Donie's Ireland daily news BLOG update

Lowering the USC rate could cost Irish exchequer some €364m

   

Lowering the cost of the Universal Social Charge by a percentage point for 1.28m taxpayers earning over €17,575 would cost the exchequer €364m, or over half of all the amount that Finance Minister Michael Noonan has indicated would be available for tax cuts in his pre-election budget next month.

Increasing the €12,012 threshold for paying the USC charge to €14,000 would benefit 80,000 taxpayers and cost the exchequer €22m.

And increasing the same €12,012 entry point for paying the USC by €1,000 and re-aligning the 1.5% band would benefit all 1.74m taxpayers who pay the USC, or 72% of all income earners. That measure alone would cost €49.7m.

The estimates come from the Irish Tax Institute which yesterday published a host of figures on the costs of the fiscal options facing the finance minister in the budget.

Since last April, Minister Noonan has repeatedly said the Coalition plans to unveil an expansionary budget of between €1.2bn and €1.5bn. The measures would be evenly split between tax cuts and spending increases.

But analysts say the Tax Institute figures reveal the dilemma facing the minister.

Alan McQuaid, chief economist at Merrion Capital, said that cutting income tax or announcing other personal tax measures would likely be more beneficial because cutting the USC rates appears very costly.

“There are no easy options,” Mr McQuaid said. “I think they will focus on low income workers this year ahead of the election” because there are likely to be more votes in cutting income tax rates or thresholds.

“It does underline that €750m [in tax cuts] is not a lot of money, but of course they may raise money on petrol because oil prices are low, to compensate,” Mr McQuaid said.

Philip O’Sullivan, chief economist at Investec Ireland, predicted that the minister’s tax changes would cost about the same as the tax measures he introduced in the 2015 budget.

Mr O’Sullivan said there would be probably tax cuts of over €600m benefiting workers. There would however unlikely be any increase in the Vat rate for the hospitality industry because the election is looming, he said.

On possible income tax measures, the Irish Tax Institute says that increasing the 40% income tax band by €1,000 to €34,800 would benefit all single persons earning more than €33,800. That measure would cost the Exchequer €72.4m.

Increasing both 40% income tax bands for married two income earners by €1,000 would cost €74.3m.

On taxes on capital, lowering the 33% tax on gift and inheritance taxes would cost €12m for each percentage point reduction.

The Institute says its research shows that Irish taxpayers on €75,000 pay more personal tax than in Sweden, Spain, the UK and the US.

It says that it is accepted globally that the best way to boost innovation in the economy is to “keep down tax on internationally mobile activities as to attract the key executives who contribute to the economy.”

The country needs “talent to grow our start-ups, our SMEs and to continue attracting international companies to Ireland.”

The Institute argues that other countries, including Scotland, Australia and Belgium, have been eager to tackle the “key issue” of attracting highly-skilled overseas’ staff through the use of personal tax incentives.

Ireland regains it’s top 10 rank at eighth in the list of innovative economies

 

Switzerland holds onto the top spot as Ireland advances three places in Global Innovation Index 2015

Ireland has moved into the top ten of the world’s most innovative economies. Switzerland, the UK, Sweden, the Netherlands and the US are the world’s five most innovative nations, according to the index.

Ireland has moved into eighth position in a list of the world’s most innovative economies, moving past Luxembourg and Denmark in the Global Innovation Index 2015. Last year it fell back three places to 11th in the benchmarking survey.

The annual report, released by Cornell University, INSEAD, and the World Intellectual Property Organization, surveys 141 economies around the world, using 79 indicators to determine innovation capacities and measurable outputs.

Simon Harris, Minister of State for International Financial Services, welcomed the result.

“Ireland’s rise three places into the Top 10 is a welcome acknowledgement that our hard won recovery is recognised internationally, and speaks to this Government’s commitment to rebuild our reputation on the global stage. A continued focus on innovation-supporting policies is key to translating our recovery into a sustainable economy and prosperous society into the future”.

Switzerland, the UK, Sweden, the Netherlands and the US are the world’s five most innovative nations, according to the index, while China, Malaysia, Viet Nam, India, Jordan, Kenya, and Uganda are among a group of countries outperforming their economic peers.

Spanish Armada dead remembered in Streedagh Grange Sligo ceremony

1,100 died when, in violent storms in September 1588, three ships from the Armada were driven ashore and wrecked

    

The Spanish Armada shipwrecks in 1588 at Streedagh, Grange Co Sligo, The lives  lost some 427 years ago were marked as above picture and the laying of a wreath show in the watery grave on the golden sands of Streedagh beach last Saturday the 22nd September 2015.

A ceremony which included the local art group from Drumcliff/Rathcormack Cos Cos pictured left to remember the 1,100 soldiers from three Spanish Armada ships who perished at Streedagh, Co Sligo, more than four centuries ago has been held on the beach there. Hundreds of local people stood for a minute’s silence as the Last Post was played and a wreath carried to the sea by members of the Sligo Sub Aqua Club on Saturday afternoon.

Eddie O’Gorman, chairman of the Grange Armada Development Association, said it was important to mark the spot where so many lost their lives 427 years ago. “Those people got neither a wake nor a burial,” he said.

Locals and tourists etched some 1,100 crosses into the sand on the golden beach to mark each life lost when, in violent storms on September 25th, 1588, three ships from the Armada were driven ashore and wrecked there. La Lavia, La Juliana and the Santa Maria de Vision were part of Philip II of Spain’s failed attempt to invade England.

Attention has focused on the wrecks since the discovery in February of this years timbers from La Juliana. In June and July, divers from the underwater archaeology unit of the Department of Arts,Heritage and the Gaeltacht recovered several cannons.

Declan Bruen from Streedagh discovered the timbers on the beach. He was among those taking part in the weekend ceremony, the highlight of the Celtic Fringe Festival. “I was with the divers when they brought up the cannons and it was remarkable to think that no one had seen them for 427 years,” said Mr Bruen. “But it was very important not to let the 1,100 people who died here be forgotten in all the excitement about the artefacts.”

A local man Seán Gilmartin (86) from Moneygold said the cannons, which were transferred to the National Museum, should find a permanent home near Streedagh. He said “I grew up near the beach and it was my playground and somewhere I fished,” he said, “but it was also a graveyard for many and we should remember that locally.”

Target to reduce mortality missed

      

A study from the UN Inter-agency Group for Child Mortality Estimation (UN IGME) led by UNICEF on progress to reduce child mortality has revealed that although there has been substantial progress globally during the Millennium Development Goal (MDG) Target period of 1990-2015, only 62 of 195 countries with available data have met the MDG target of reducing under-five mortality (U5MR) by two thirds over these 25 years.

The research, published in The Lancet, by Dr Danzhen You and co-authors on behalf of the UN IGME, is the first to include U5MR estimates up to the MDG target year (2015) and to construct scenario-based projections from 2016 to 2030 to provide insights into the burden of under-five deaths over the next 15 years based on the newly proposed Sustainable Development Goal (SDG) target of 25 or fewer under-five deaths per 1,000 live births by 2030.

The global U5MR has fallen from 91 deaths per 1,000 live births in 1990 to 43 in 2015. During the same period, absolute under-five deaths worldwide dropped from 12.7 million to 5.9 million. In total, an estimated 236.3 million children under age five died in 1990-2015. The poorest global region of West and Central Africa continues to have the highest U5MR in the world.

Globally, U5MR reduced by 53% in the past 25 years and therefore missed the MDG 4 target (of two-thirds). The data show that two regions — East Asia and the Pacific, and Latin America and the Caribbean — achieved the MDG 4 target. At the country level, 62 countries achieved the MDG 4 target. Among them, 24 are low- and lower-middle income countries, from a variety of world regions — including Ethiopia, Eritrea, Bangladesh, Georgia, El Salvador, Bolivia, Egypt, Cambodia, Nepal and Yemen.

Encouragingly, for 102 countries, the data suggest a faster decline in 2000-2015 as compared to 1990-2000. This acceleration since 2000, when the MDGs were established, resulted in about 18 million fewer under-five deaths globally, as compared to a scenario where the pace of decline would have remained the same as in the 1990s.

While there is no doubt that some countries have fared better than others, the data show that there is room for improvement, even in the 116 countries which already, in 2015, have a U5MR lower than 25. Should 2015 rates continue to 2030, a further 6 million children will die in these nations; yet if all of them reached the current lowest U5MR of 2.3 per 1,000 live births recorded among countries with more than 10,000 live births (Finland), then this would be reduced to 2 million.

Should the SDG target be met, this would save the lives of an extra 38 million children under five than if 2015 U5MR are maintained through to 2030. If current mortality rates are maintained, 94 million children will die during 2015-2030; if the rate of progress from 2000-2015 is maintained from 2015-2030 then 69 million will die, while if the SDG target above is met, the death toll in under fives will be 56 million.

In order to achieve the SDG goal on under-5 mortality, a total of 47 countries need to accelerate their U5MR progress, including 34 countries in sub-Saharan Africa along with two countries (Afghanistan and Pakistan) in South Asia. The authors highlight that, even with progress in U5MR, the actual numbers of child deaths may remain stagnant or even increase in sub-Saharan Africa, since in the region the under-five child population is likely to increase by around 42 million from 2015-2030.

Thus reduction in under-five mortality rate must outpace increases in under-five child population to continue the decline in total deaths.

300m-year-old volcanoes discovered in Ireland near Mullingar

Geological Survey’s Tellus Programme unearths highly magnetic volcanic rocks

    

An image generated from the aircraft survey showing results of the airborne survey over counties Offaly, Kildare, Meath, rural Dublin and northern parts of Wicklow and Laois.

Geographically, Ireland is often likened to a saucer: upturned at its mountainous edges and flat in the middle. But that reading doesn’t take account of newly discovered volcanoes south of Mullingar.

The Geological Survey’s Tellus Programme has unearthed aspects of the long buried history of counties Roscommon, Longford and Westmeath.

The maps reveal new detail of 300 million-year-old volcanoes on the Westmeath/Offaly border, which appear in the new airborne geophysical data as a cluster of small magnetic bodies.

The survey, conducted using low flying aircraft, also shows prominent bands of highly magnetic volcanic rocks several kilometres deep near Strokestown, Co Roscommon, which are associated with a major geological fault that can be traced through Ireland to Scotland.

The researchers say these structures are considered important in the development of mineral deposits and their location will be of considerable interest to exploration companies.

The survey aircraft, use technology that effectively sees through Ireland’s often deep glacial deposits and extensive peat cover.

“Tellus continues to reveal extraordinary new detail in Ireland’s geological landscape buried beneath our feet, building upon existing data gaps and developing natural resource opportunities,” said Geological Survey of Ireland principal geologist Ray Scanlon.

The fourth phase of Tellus is underway across the east of the country where the airborne survey over counties Offaly, Kildare, Meath, rural county Dublin and northern parts of Wicklow and Laois is almost 60 per cent complete.

Attention is currently focused on county Dublin.

The aim of the programme is to complete the geological ‘jigsaw’ of Ireland which will support better environmental decision making, radon mapping, smart agriculture and increased investment in mineral exploration.