Written Answers. - Maritime Sector.

Bernard J. Durkan


154 Mr. Durkan asked the Minister for the Marine and Natural Resources his position in regard to the future development of the Irish fleet, with particular reference to the tonnage tax; and if he will make a statement on the matter. [7735/01]

The Government is fully committed to the development of the maritime sector, including the expansion of the Irish registered fleet. This commitment has been given concrete expression by the introduction in recent years of a number of fiscal reliefs for the sector: concessions in the corporation tax area for shipping associated leases; full refunds of employer's PRSI payments for seafarers; introduction of a special £5,000 seafarer's income tax allowance, with access to that concession made easier in the December 2000 budget – the budget provided for a reduction from 169 to 161 in the number of days a seafarer is required to be on a voyage to or from a foreign port to qualify for the allowance; the introduction of a 12.5% rate of corporation tax for profits from shipping, from 1 January, 2001 instead of 1 January, 2003, that is, two years ahead of schedule.

In addition, the Government has established a dedicated statutory development agency for shipping, shipping services and seafarer training – Irish Maritime Development Office. The establishment of a new National Maritime College at Ringaskiddy is being progressed to meet Ireland's naval and merchant marine seafarer training requirements.

I am also committed to the overhaul of registration procedures for merchant ships. The Irish Maritime Development Office will take over and manage the modernised ship register later this year.

As regards the specific issue of a tonnage tax, the Irish Maritime Development Office has made a strong case for the introduction of incentives and fiscal measures for the shipping sector beyond those already in place. At the forefront of the proposals is the introduction of a tonnage tax in line with other EU member states.

The range of fiscal measures, reliefs and incentives proposed by the IMDO to regenerate the shipping industry and shipping services sector remain under consideration, including the introduction of a tonnage tax.
Recent remarks by Commissioner De Palacio, reported in the specialist shipping press, on the possible introduction of a pan-European tonnage tax are very encouraging and are helpful in the context of pressing the case for a tonnage tax with the Department of Finance.