Dáil Éireann debate -
Tuesday, 15 Jun 1993

Vol. 432 No. 3

Written Answers. - Financial Services Industry Association Report.

Proinsias De Rossa

Question:

43 Proinsias De Rossa asked the Minister for Finance if his attention has been drawn to the recent report commissioned by the Financial Services Industry Association which found that most IFSC companies were exclusively tax and treaty tax dependent and which recommended a shift from such activities; if his attention has further been drawn to reported comments of a leading representative developing the IFSC that no further development will take place until firms give binding commitments that they will move to newly built offices; the response, if any, he has given to these reports; and if he will make a statement on the matter.

Minister for Finance (Mr. B. Ahern)

I am aware of and have seen the report of the IFSC which was prepared by the Financial Services Industry Association. The report, which contains much information and many recommendations is, however, a confidential one, elements of which are being examined by the IFSC Committee which is chaired by the Department of the Taoiseach. I am not in a position, therefore, to comment on any particular parts of it.

I can say in general, however, that there are some companies in the Centre which rely in the early stages of development on the tax benefits available. This is normal and to be expected but is not to be encouraged beyond that stage because it would not provide a sound basis for the future development of those companies, particularly after 2005 when the current tax incentives for IFSC companies are due to terminate. I would of course lend my support to any initiatives which would act to strengthen the Centre in ways which would contribute to its long term future.

In regard to the future physical development of the area the recently concluded Master Plan Agreement between the Custom House Docks Development Authority and the developers, which provides for further construction of office, residential and leisure facilities at the Area, requires pre-letting of the office buildings in advance of construction. Such pre-letting will facilitate the re-commencement of construction work in the area, with the generation of up to 500 jobs, at a time when current conditions in the market for office space might otherwise result in the further postponement of construction work. I do not consider that this is unreasonable as the requirement to relocate the centre is part of the terms under which companies obtain tax relief.