Vol. 505 No. 6
128 Mr. Perry asked the Minister for Finance the tax benefits a tourism related scheme in Ballymote, County Sligo, which already qualifies for the hotel incentive scheme would qualify for; and if he will make a statement on the matter. [14297/99]
There are already generous capital allowances available for hotels and holiday cottages throughout the State, in that 100 per cent of qualifying capital expenditure can be written off at 15 per cent per annum over a six year period and the remaining 10 per cent in year seven. Hotels and holiday cottages are accordingly not included for the purpose of the rural renewal scheme as qualifying buildings. In addition, hotels in County Sligo and in six other counties in the north-west with the exception of the area designated under the seaside resort scheme, are not subject to the capital allowances restrictions introduced in the 1998 budget and Finance Act, for individual passive investors.
Buildings providing bed and breakfast accommodation are considered as commercial buildings for tax treatment purposes under the rural renewal scheme and qualify for capital allowances of 50 per cent of relevant expenditure on construction or refurbishment work carried out in the qualifying period. An initial allowance of 25 per cent may be claimed by both owner occupiers and lessors with annual allowances of 2 per cent for the balance up to a maximum of 50 per cent. Alternatively an accelerated allowance known as free depreciation of up to 50 per cent is also available to owner-occupiers. Lessees of qualified commercial buildings can also qualify for a double rent allowance for tax purposes in respect of rent paid under a bona fide commercial letting, subject to EU commission approval.
I have not yet received EU Commission approval for the business tax incentives of the rural renewal scheme and I will not be in a position to introduce these incentives until such approval is received. The current position is that a reply to the EU Commission's latest request for additional information was sent on 24 May 1999 and it is now expected that EU approval will be obtained by the end of July at the latest.
