This section defines profits available for distribution to equity holders for the purpose of section 108. The percentage to which one company is entitled of any profits available for distribution is fixed as the percentage to which it would be entitled on a full distribution in money of the profits of the other company for the accounting period, or if there were no profits for the accounting period, profits of £100.
SECTION 110.
Question proposed: "That section 110 stand part of the Bill."
Why that?
We have to have some figure to go on.
What it looks like on the surface is that profits which are not there to the extent of £100 would be deemed to be there. I presume that is not what is intended.
Profits will be assumed to be there?
Will that involve any tax liability.
No.
For the purpose of this group relief, have all the member companies of a group or consortium to be based in and trading in Ireland?
Resident in Ireland.
If such a group has non-Irish member companies, does the entire group lose the relief or is the relief confined simply to transfers of losses as between the Irish companies?
The non-resident company would not be regarded as part of the group. The relief would be available only to companies within the Irish range. The fact that there was within a commercial group a non-resident company, as they would see it, would not deny to the Irish company this relief.
In that context the holding company of a share group would, therefore, pay tax on the money it received from that company.
Sorry?
The holding company in a share group would pay tax in that situation on the money it received from the foreign company?
The holding company in such a case would have to be an Irish company. We could not have a non-resident holding company as part of a group and treat the other companies as being one of a family where the holding company was non-resident.
Why a resident company?
It might not necessarily be registered in Ireland. It might be controlled in Ireland.
Take a group such as McInerneys. Their biggest subsidiaries are trading in England.
I do not think Deputy O'Malley should mention particular companies when we are on the record because any comment made in relation to their affairs could——
We take company X.
Company X. A great deal would depend upon where the company was managed and controlled. It could be operating in England with the management and control here. This is a matter for judgment in each case.
Presumably the English authorities. The English Revenue would want to charge corporation tax in England.
The double taxation agreements.
They might see it as a branch or agency of an Irish resident company and they could charge corporation tax on the profits of the branch or agency operating in England, even though the company was managed and controlled from Ireland. Under the double taxation agreements there would be set offs.
Question put and agreed to.
Regarding further sittings?
This day fortnight. I seriously want to make a point. My Whip was very annoyed. He was here on his own at one stage.
He was very dense.
This is getting very difficult.
Could the Minister give us an outline of his time scale? It must be passed by when?
It must be passed by Friday, 2nd April.
It will take, I suggest, not more than two days in the Seanad. They will not get bogged down in this.
Not meaning any disrespect to anybody here but they have excellent tax brains in the Seanad. I am sure they are looking forward with great relish to getting their teeth into this. I am not too certain at all that it will get through speedily. We have to go to the Dáil with the Report Stage. In order to meet our target date of the first week in April really we should finish the work of this Committee by 5th March.
When?
Monday week. So, in losing next week we are in considerable difficulties.
The 5th March. That is Friday week.
Where does the most of March go?
We are now on the 25th February and if we could dispose of this next Tuesday and Wednesday or some day next week we would meet our target date. If we do not finish it here next week we cannot bring it into the Dáil on the following week for Report Stage. We must finish it in the Dáil on the week ending 12th March in order to allow the Seanad two weeks for it. This means that the Second Stage, on which I presume there will be a debate, will be delayed and the Committee Stage still remains to be discussed. We are really short of the time available for the Seanad to discuss this.
The Misuse of Drugs Bill Committee is fixed for 3.45 on next Wednesday.
The Seanad cannot make any amendments because this is a Money Bill.
How did we get ourselves into this fix?
Because the Government were asked, when they circulated the Bill in November, to leave over discussion of it until after the Christmas Recess in order to have an opportunity of considering it. It was not circulated until the end of November because of the need to take account of all the representations which were received and in order to complete the drafting. Everybody will accept that this was a monumental piece of work.
This makes a joke of the whole legislative process. We do not have the time to deal with it adequately.
I am afraid it calls in question the value of these Special Committees. Our view of them has changed. We feel that they are of little value. There are now three running concurrently. This legislation is not being examined properly.
We are in an unusual situation in regard to this Bill which is unlikely to be repeated. We are up against a time limit but I do not think it has lost anything by being taken in Special Committee rather than on the floor of the House. It has gained something by being discussed here.
What about Tuesday next? There is nothing on then.
Deputy Colley is ill and will not be in the House next week. In those circumstances could the matter be left over to the following week? The Misuse of Drugs Bill Committee are meeting next week and Deputy Haughey will be on it. The Joint Committee of Secondary Legislation will also be meeting and Deputy Haughey is on that as well. In view of the fact that our spokesman is not available—we have facilitated the Minister up to now and went ahead yesterday and today—could it not be left until the week after next?
I would readily agree and say: "Leave it until the month of May for that matter" only for——
There are six weeks left now. We are at the 25th February. The Bill does not have to be passed until 5th April.
What about the other Stages?
What about Tuesday and Wednesday mornings of next week? There are no other meetings on then.
Why are we not meeting tomorrow?
The Public Accounts Committee are having their final meeting.
Deputy de Valera cannot be at that.
The last thing I want is to have this debate conducted in the absence of any Members of the Opposition who wish to be here but I am sure they accept the obligation which lies on us all to try and get this legislation through for the benefit of the community before the commencement of the next tax year. As a result of this legislation there will also be legislation in Britain with whom we have such close commercial ties, to adapt their legislation to some of these changes. Because of the complexity of the legislation any delay will be aggravated as time goes on. I know that it is an awful ordeal and I am as reluctant as anybody else, physically and mentally, to go through it.
Could we compromise by suggesting that we sit for one day only next week of not more than four hours?
Perhaps on Ash Wednesday, being a day of penitance, we could sit longer.
That clashes with the Misuse of Drugs Bill Committee.
What about Tuesday?
What time?
Afternoon.
Would we start at 2.30 p.m. and sit until 6.30 p.m.?
Might I suggest that we might settle the matter now and then find that there would not be a great deal of unfinished work so that we might find a couple of hours later in the week to complete it. Then, it could be brought into the Dáil the following week. It is not a matter of our personal convenience we should look at.
It is not a question of convenience.
Every one of us has been put to the greatest possible inconvenience. I have not written one letter this week. My constituents do not thank me for being in this wretched place. There is nobody, other than the people who have the misfortune to sit in this room, who know that we are here or, for that matter, care. We get no thanks of any description for being here. The very fact that any of us have spent even five minutes here has been a matter of great inconvenience.
I am sure we do not come here looking for thanks.
Is it decided then, 2.30 to 6.30 p.m. on Tuesday?
Full stop.
We will review a further meeting on Tuesday afternoon.
If we do not finish then will we finish on Thursday? There is not a lot to be done.
The Schedules are over 100 pages.
I want it to go on the record that this Bill will go down to posterity without the full benefit of my intellectual capacity.
It already is in print without the Deputy's intellectual capacity.
We cannot really do our duty as legislators in these circumstances.
2.30 to 6.30 p.m. Tuesday next?
I am sure there are loopholes by which people are avoiding paying their tax which could be tied up if we really got down to it.
I would be glad to be exhorted in this direction because I am often chastised from the other side of the House for pursuing such a course.
Progress reported; Committee to sit again.
The Committee adjourned at 6.40 p.m. until 2.30 p.m. on Tuesday, 2nd March, 1976.