Vol. 510 No. 6
205 Mr. J. O'Keeffe asked the Minister for Finance if he will extend the business expansion scheme which provides tax incentives for tourists and manufacturing enterprises; and if he will increase the amount of eligible investment per project to £500,000. [23507/99]
The 1998 Finance Act reduced the aggregate amount that a company could raise under the business expansion scheme, BES, from £1 million to £250,000. The BES limit was reduced to refocus the relief on start-up/smaller companies which find it hard to raise finance elsewhere. This was the original intention of the BES. It was also to reduce the growing cost of the relief to the Exchequer.
The BES was due to finish on 5 April 1999. A paper prepared for the tax strategy group, in October 1998, concluded that information was not yet available to determine what effect the reduction in the aggregate amount a company could raise under the BES had on the scheme. However, initial indications were that the budget day changes had the desired effect in focusing the BES on smaller/start-up companies.
The Finance Act, 1999, extended the BES to 5 April 2001. The scheme will be reviewed again before any decision is taken on whether to extend it beyond 5 April 2001.
