Dáil Éireann Debate, Thursday - 2 October 2014
28. Deputy Michael McGrath asked the Minister for Finance the number of initiatives he has announced which have not commenced as they are awaiting EU state aid approval; and if he will make a statement on the matter. [37056/14]
View answerLiving City Initiative
The Living City Initiative, announced in Finance Bill 2013, is a pilot project which provides certain tax incentives to make it more attractive for people to live in historic and culturally significant city centre houses. The initiative also offers incentives for retailers and small businesses in those areas. This Initiative is subject to EU State Aid approval and a commencement order. An ex ante cost benefit analysis was conducted in the summer of 2013 and published alongside Budget 2014. An application for EU State Aid approval was submitted in March 2013. It is hoped that this issue will be concluded in the very near future. An independent cost-benefit analysis concluded that the Initiative would create more than 1,000 jobs for each of the 5 years it will be in place. The analysis also concluded that the annual cost would be in the order of €3m per year.
Film Relief
The Film relief scheme has been in place since 1987. Finance Act 2013 introduced new provisions to ensure that Film tax reliefs will accrue to the producers rather than investors and result in tax savings for the Exchequer. Budget 2014 extended the definition of 'eligible individual' to include non-EU talent, in conjunction with the introduction of a withholding tax. It is intended to commence these provisions once EU State Aid approval has been given. The Department of Arts, Heritage and the Gaeltacht are progressing this State Aid approval with the EU Commission. Statistics are not available to show the actual number of persons employed in the film industry. However, it is estimated that in 2013 just over 27,000 individual employments (both part-time and full-time) were generated on film productions supported by Section 481 relief.
Tax scheme for the construction or refurbishment of certain aviation services facilities
A scheme of accelerated capital allowances for the construction and refurbishment of certain buildings and structures for use in the maintenance, repair or overhaul of commercial aircraft, and the dismantling of such aircraft for the purposes of salvaging or recycling of parts or materials was announced in Budget 2013 and an application was made to the EU Commission on 18 June 2013.
The Commission formed the view that the scheme in its current form is not compatible with State Aid guidelines. Following on from meetings and discussions with EU officials, a revised application was recently submitted to the Commission, which I hope will will lead to a positive result in the near future.
Exemption from Stamp Duty
Exemption from Stamp Duty on the transfer of shares of companies listed on the Enterprise Securities Market of the Irish Stock Exchange, is subject to State Aid approval. The proposed measure aims to encourage entrepreneurs and growing businesses to use public equity markets as a source of funding for growth and the creation of jobs.
CGT Entrepreneur Relief
A capital gains tax relief for entrepreneurs who reinvest the proceeds from the disposal of assets made on or after 1 January 2010 in certain chargeable business assets was announced in Budget 2014 and provided for in Section 45 of Finance (No 2) Act of 2013. Commencement of the legislative provisions is subject to EU state-aid approval. Discussions with the EU Commission about State Aid clearance are ongoing. I hope that these will result in a positive outcome in the near future.
