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Tax Reliefs Application

Dáil Éireann Debate, Tuesday - 21 May 2013

Tuesday, 21 May 2013

Questions (95)

Gerry Adams

Question:

95. Deputy Gerry Adams asked the Minister for Finance his views on the need for a review of the SARP. [23944/13]

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Written answers

Section 14 of Finance Act 2012 introduced the Special Assignee Relief Programme which is designed to reduce the cost to employers of assigning key individuals in their companies from abroad to take up positions in the Irish based operations of their employer. Paragraph 10 of Section 14 provides that relevant employers must submit an annual return to the Revenue Commissioners detailing, inter alia, the number of employees and the amounts of exempt income claimed under the programme. As 2012 was the first year of the programme, this return was not sought until after the end of the tax year 2012 in order to ensure that an accurate picture as possible of take up levels over a full tax year could be provided.

At the time of its introduction, it was estimated that for every 100 assignees that avail of the programme up to the maximum level of relief, the tax cost would be just over €5 million. Employer returns received to date for 2012 indicate that there were 6 individuals who qualified for the relief with 2 of them receiving an aggregate total tax-free remuneration of €39,767. Job increases were reported as numbering 26 with 2 jobs also reported as retained because of the relief. It is expected that the 4 individuals who are not reported in the employer returns as receiving tax-free remuneration are expected to claim it when they submit Form 11 tax returns for 2012 in late 2013.

It is possible that not all employers have submitted a SARP return yet. Also, the figures provided do not include the details for claims that are not included in employer returns received to date but will be made in the Form 11 tax returns for 2012 to be filed under the self-assessment system in October/November of 2013.

The scheme was introduced for an initial three-year period ending on 31 December 2014, at which point it will be reviewed. At that stage we should have additional information regarding the number of individuals availing of the exemption, the sectors of industry that the individuals are employed in, the cost of the programme and the number of jobs created or retained as a result of the relief. All of this information will feed into the review. Depending on the outcome of that review, I will decide whether the relief should be retained.

It is worth nothing that the existence of similar incentives in other European countries such as the Netherlands, Sweden and Switzerland would indicate that such incentives can be a persuading factor when companies decide where to locate investment projects. In tandem with our corporation tax rate, this relief will help us to compete for Foreign Direct Investment.

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