Dáil Éireann Debate, Tuesday - 15 January 2019
199. Deputy Joan Burton asked the Minister for Finance the preparations made for a significant increase in businesses registering here ahead of Brexit; the measures he is taking in order to protect Irish SMEs during an influx into the economy; and if he expects a significant increase in the amount of corporation tax paid from foreign investment. [54499/18]
View answerThe Government are aware of the complexity of Brexit which, in whatever form it takes, will likely have a negative economic impact on Ireland. My Department has been to the forefront in assessing the impact of Brexit on our economy, commissioning joint research with the ESRI on the issue even prior to the referendum taking place. It is clear from this research and further studies, that a hard Brexit will have a considerable negative impact for Ireland.
The Government has already taken a number of important steps to prepare our economy for the challenges of Brexit. The Government has been building resilience through the creation of fiscal capacity, including by balancing the books and reducing our debt burden, building resilience to economic shocks through the establishment of the ‘Rainy Day Fund’. The fund is intended to act as an economic buffer in the event of a particularly severe economic downturn.
Our recent economic history highlights the importance of creating a fiscal safety buffer to help absorb inevitable shocks, at the same time, ensuring the long-term sustainability of the public finances.
The Government is also providing dedicated loan funds for affected businesses. As the Deputy will be aware, I announced a €300 million Brexit Loan Scheme in Budget 2018 to provide support to Irish SMEs to diversify and restructure their businesses in light of Brexit. This Scheme was launched at the end of March of last year. Following on from the successful launch of the Brexit Loan Scheme, as part of Budget 2019 I announced the development of the Future Growth Loan Scheme of up to €300m to provide long-term investment finance of 8-10 years to help Irish businesses invest strategically in a post-Brexit environment. I anticipate that this Scheme will be launched early this year.
The measures introduced in Budget 2019 continue the process of ensuring that Ireland’s economy remains competitive and resilient against the backdrop of heightened uncertainty, including from Brexit.
The Government and State agencies will also continue working hard to exploit any opportunities from Brexit, including promoting trade and investment opportunities in Ireland, as an English speaking member of the EU with unfettered access to the EU market.
At the sectoral level new opportunities have been identified – particularly in the international financial services sector which is heavily reliant on access to the Single Market and ongoing compliance with EU regulatory standards. Brexit has already seen opportunities for Ireland to increase its share of financial services-based inward investment. Public announcements to establish or expand operations have been made by a number of companies.
With regard to business registrations, I am advised by Revenue that the numbers of companies and businesses registering for Corporation Tax and Income Tax has been increasing in recent years. However, it is not possible to identify those registering as a result of Brexit separately from normal growth and expansion of the Irish economy.
I am further advised that Revenue provides an easy to use on-line facility that allows new customers to register for their taxes online. This facility can cater for significant numbers of new registrations if the need arises.
As the Deputy is aware, forecasts of tax receipts are produced by the Department of Finance with assistance from Revenue. The role of Revenue is to advise of any potential increases and decreases in taxation that they have been made aware of from administering the taxes and other data sources available to them. Revenue are not currently aware of any significant increases in tax receipts expected as a result of increased investment due to Brexit.
