Revenue Commissioners Investigations

Questions (122)

Catherine Murphy

Question:

122. Deputy Catherine Murphy asked the Minister for Finance if officials of the Revenue Commissioners have visited a site (details supplied) in County Kildare to date in 2019; if so, the nature and-or reason for inspection; and if he will make a statement on the matter. [35833/19]

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Written answers (Question to Finance)

Section 851A of the Taxes Consolidation Act 1997 requires Revenue to uphold taxpayer confidentiality and prohibits the release of any information that could lead to the identification of taxpayers.

Revenue has however, assured me that it carries out a full range of risk-based interventions to combat all types of tax evasion and non-compliance. These interventions include visits to construction sites, many of which are conducted on a multi-agency basis with other Departments or Bodies, including the Department of Employment Affairs and Social Protection (DEASP) and the Workplace Relations Commission (WRC). The site visits are primarily focussed on identifying and rectifying bogus self-employment situations and ensuring the proper operation of the PAYE system, but will also investigate any other forms of tax non-compliance found to be in operation.

Revenue Commissioners Investigations

Questions (123)

Pearse Doherty

Question:

123. Deputy Pearse Doherty asked the Minister for Finance the efforts the Revenue Commissioners make to engage with subcontractors to ensure that they are reimbursed the relevant contract tax and to resolve related filing issues; and the amount of tax which has not been retuned in each of the years 2005 to 2018 and to date in 2019. [35952/19]

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Written answers (Question to Finance)

I am advised by Revenue that extensive efforts are made to engage with sub-contractors (and their agents) to ensure that the Relevant Contracts Tax (RCT) system is operated correctly. 

Since 1 January 2012, all RCT payment and return filing activity is conducted online using the Revenue Online Service (ROS). The online facility provides sub-contractors with access to a range of reporting facilities, which enables them to view the contract payments made to them in any specified period and any related RCT withheld. Also, sub-contractors who have fiduciary tax liabilities as employers and/or who are registered for and required to deduct VAT, can offset any RCT withheld against those liabilities, provided they have filed the relevant tax returns. 

Revenue also advises me that sub-contractors’ annual tax returns (Form 11 or CT1) are pre-populated with the gross payments received, and the RCT withheld for the year. Additionally, the ‘Summary Pay and File Liability’ screen of the ROS annual return provides sub-contractors with the amount of RCT credit that is available for offset against either the balance of tax for that year or against the preliminary tax due for the following year. After the offsets are completed, any remaining credit is automatically refunded to the sub-contractor, providing all other tax returns are filed.

To ensure a high level of timely compliance across the self-employed sector, Revenue issues ‘pay and file’ reminders to all customers, including sub-contractors, to ensure they prepare for and file their tax returns on time. Also, in addition to making all RCT information available to sub-contractors through ROS, Revenue provides additional support via the Revenue website and through secure email channels and telephone services. These services responded to almost 80,000 requests for assistance from sub-contractors (or their agents) in 2018.

The following table sets out the amounts of RCT paid to Revenue by principal contractors and subsequently either offset or repaid to sub-contractors for the years 2007 to 2019 (year to date). 

Year

RCT Gross

RCT Offsets

RCT Repayments

RCT Net

 

€m

€m 

€m

€m

2007

1,033.40

578.3

405.3

49.9

2008

826.7

504.7

389.3

-67.3

2009

436.5

224.8

265.5

-53.9

2010

312.4

140.0

181.7

-9.3

2011

267.3

103.5

169.9

-6.1

2012

174.3

96.0

75.9

2.4

2013

157.0

101.2

43.5

12.3

2014

200.8

121.2

48.7

31.0

2015

200.6

126.6

61.5

12.5

2016

255.5

161.0

54.6

39.9

2017

316.9

194.3

78.8

43.8

2018

364.7

229.7

97.0

38.0

2019 (to end-July)

293.5

172.0

71.8

49.6

  The data for 2005 and 2006 cannot be provided as the IT systems at that time did not provide a breakdown between offsets and refunds.

Proposed Legislation

Questions (124)

Michael McGrath

Question:

124. Deputy Michael McGrath asked the Minister for Finance when he plans to bring forward the migration of participating securities Bill; when the legislation will be enacted; and if he will make a statement on the matter. [35962/19]

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Written answers (Question to Finance)

Post-Brexit when the UK becomes a third country, under the CSD Regulation, Euroclear UK & Ireland will no longer be able to provide its services into the Irish market. 

In response to Brexit and its anticipated impact on the Irish market, Euronext Dublin (formerly the ISE) announced in October 2018 that it would transfer the settlement of trades in Irish equities and exchange traded funds from CREST, the settlement system operated by Euroclear UK & Ireland, to Euroclear Bank which is a CSD based in Belgium. 

Following discussions with Euronext Dublin, Euroclear Bank, issuers, registrars and other market participants in the broader Irish market over recent months, the Minister for Business, Enterprise and Innovation and I brought jointly sought and got Government approval, in July of this year, to draft primary legislation to provide an alternative scheme of arrangement for Irish issuers to migrate. 

The enactment of this legislation entitled the Migration of Participating Securities Bill is a priority for the Government in the autumn term as part of our overall Brexit preparations and to minimise potential disruption to the Irish market and issuers from the change in settlement system.  A drafter has been assigned by the Office of Parliamentary Counsel, and the process of drafting the Bill is underway. I would note that the proposed legislation is complex and without precedent.

The Government's intention is to have the legislation in place this year. We believe that this is importnat so as to allow Irish issuers sufficient time to complete their own individual internal migration planning and hold the necessary shareholder votes during 2020.  The Industry White Paper, issued by Euroclear, envisaged all issuers will be able to confirm by November 2020 that they have taken all necessary steps to migrate to the new settlement system.  As I noted earlier, this project is a complex one and without out precedent. As such, it is wise to allow sufficient time for testing of the new systems and settlement arrangement sufficiently in advance of the EU Commission's March 2021 migration deadline.

I look forward to working with my colleagues in Government and in the Oireachtas in the coming months on this important piece of legislation so as to ensure the smooth completion of our Brexit preparations in this important area.

Revenue Commissioners Staff

Questions (125, 126, 127, 128)

Joan Burton

Question:

125. Deputy Joan Burton asked the Minister for Finance the number of additional Revenue Commissioners staff assigned to the Border with the UK in respect of preparedness for the forthcoming departure of the UK from the European Union; and if he will make a statement on the matter. [36005/19]

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Joan Burton

Question:

126. Deputy Joan Burton asked the Minister for Finance the number of Revenue Commissioners staff he plans to assign to the Border with the UK to work on counter-smuggling operations if there is an agreement with the UK by 31 October 2019 and in the event of a no-deal Brexit, respectively; and if he will make a statement on the matter. [36006/19]

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Joan Burton

Question:

127. Deputy Joan Burton asked the Minister for Finance if land or premises within 30 km of the Border with the UK for customs checks has been leased or purchased; and if he will make a statement on the matter. [36007/19]

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Joan Burton

Question:

128. Deputy Joan Burton asked the Minister for Finance the cost to date in 2019 and expected cost in 2019 to the Revenue Commissioners of expenses payable to staff being relocated to work in respect of the Border with the UK; and if he will make a statement on the matter. [36008/19]

View answer

Written answers (Question to Finance)

I propose to take Questions Nos. 125 to 128, inclusive, together.

The Government has been clear that it is determined in the context of Brexit, deal or 'no deal', to avoid the need for a hard border on the island of Ireland. I am assured by Revenue that in line with that policy it has not purchased or leased land or premises nor has it any such plans, within 30km of the Border.

In preparation for Brexit, Revenue is, recruiting an additional 600 staff across a range of grades and is confident that this full additional resource will be in place by 31 October. Revenue has confirmed to me that these staff have not been specifically assigned to anti-smuggling work and that they are being recruited for the purposes of facilitating and supporting legitimate trade to get ready for Brexit.

I am aware that Revenue continues to adjust its recruitment and training and deployment plans in response to business needs, including Brexit-related developments. Revenue advises me that it will recruit and deploy resources based on the evolving business needs and to quickly confront any risks as they emerge. I remain open to consider any request from Revenue for additional resources if required. 

The Deputy will be aware that given the increasing likelihood of a no deal Brexit, intensive discussions are taking place involving the Government, the EU Commission and our EU partners as to how we can meet the shared twin objectives of protecting the Single Market and Ireland’s place in it, and prevent physical infrastructure at the border. This work is looking at necessary checks to preserve Ireland’s full participation in the Single Market and Customs Union. Revenue is providing the necessary technical expertise and assistance to facilitate those discussions.

Revenue has assured me that it already implements a comprehensive risk-based intervention programme to identify, target and disrupt all forms of cross-border smuggling and criminality. Revenue’s priority focus on such activity will continue to be the case regardless of the eventual outcome of Brexit and the assignment of any additional resources will be determined (by Revenue) in the light of developments.

Revenue’s risk-based approach to illegal cross-border activity is, as the Deputy will be aware, facilitated and supported by very close cooperation with other agencies of the State, including An Garda Síochána, and also with colleagues in Northern Ireland through the North-South Joint Agency Task Force. I am satisfied that Revenue’s focus on cross- border smuggling is appropriate and well targeted, and I know that it is keeping the matter under active review as Brexit developments become clearer.  

Real Estate Investment Trusts

Questions (129, 130)

Joan Burton

Question:

129. Deputy Joan Burton asked the Minister for Finance the estimated number of real estate investment trusts here; and the estimated number of properties in the portfolios of such real estate investment trusts. [36029/19]

View answer

Joan Burton

Question:

130. Deputy Joan Burton asked the Minister for Finance his plans to review the corporate tax arrangements in respect of real estate investment trusts; the level of corporation tax that applies to such entities; the rate of effective corporation tax paid by such entities; his plans to commission a study of the REIT model in terms of its appropriate contribution to taxation; and if he will make a statement on the matter. [36030/19]

View answer

Written answers (Question to Finance)

I propose to take Questions Nos. 129 and 130 together.

Finance Act 2013 introduced the regime for Real Estate Investment Trusts (REITs) in Ireland. The function of the REIT framework is not to provide an overall tax exemption but rather to facilitate collective investment in rental property by removing a double layer of taxation which would otherwise apply on property investment via a corporate vehicle.

Property rental income and gains arising are exempt from tax within the REIT and are taxed at the investor level when distributed through dividend withholding tax at 20%. The legislation requires that 85% of all rental income profits be distributed annually to shareholders. The REIT is subject to corporation tax on income and gains not arising from the property rental business of the REIT. Distributions to certain limited classes of investors such as pension funds and charities do not suffer the withholding tax as they are more generally exempt from tax.

Given the important implications which developments in the property market can have for the economy, my Department actively monitors developments in this sector on an ongoing basis. In this context, the Deputy may be aware, as part of the 2018 Finance Bill process I committed that my officials would undertake a report on REITs, IREFs and Section 110 companies as they invest in the Irish property market. This report was presented to the Tax Strategy Group in July and is available on my Department's website.

There are currently four REITs operating in the Irish property market. Information in relation to the property held by REITs, taken from the 2018 published annual reports of the companies, is summarised in the TSG paper referred to in the above paragraph and is available here: https://assets.gov.ie/19114/2de9c469825a47418526e1d5c217b44c.pdf

I am advised by Revenue that, as there as fewer than 10 REITs, it is not possible to provide analysis such as the effective tax rate, due to Revenue’s requirement to protect taxpayer confidentiality.   

IBRC Legal Cases

Questions (131)

Catherine Murphy

Question:

131. Deputy Catherine Murphy asked the Minister for Finance the legal costs incurred by the State with respect to the successful case taken by a person (details supplied) in both the High Court and the Court of Appeal; if the costs are now fully discharged; and if he will make a statement on the matter. [36062/19]

View answer

Written answers (Question to Finance)

I am advised by the Special Liquidators that a settlement agreement was entered into between the parties to the proceedings and, due to the confidentiality provisions in the settlement agreement, its terms cannot be referred to.

IBRC Legal Cases

Questions (132)

Catherine Murphy

Question:

132. Deputy Catherine Murphy asked the Minister for Finance the number of cases concluded in the courts with respect to the IBRC; the costs settled to date; the nature of each case; and if he will make a statement on the matter. [36063/19]

View answer

Written answers (Question to Finance)

Since the date of the Special Liquidation in 2013, IBRC has reduced the number of legal cases under active management from over 1,100 to approximately 82 sets of legal proceedings (comprising 63 cases as defendant, 19 recovery and enforcement actions) and one alternative dispute resolution case.

Many of these proceedings are high profile and/or are of significant value, involving former directors and officers of Anglo/INBS, claims of negligence by professional advisers, or substantial claims for damages against former borrowers concerning their loans and/or related security. Where IBRC is defendant, these cases concern inter alia, allegations of mis-selling of Swaps and investments, mismanagement, negligence, breach of contract and breach of duty.

I am advised by the Special Liquidators that for reasons of confidentiality they are not in a position to outline the costs settled to date in the various legal proceedings. 

The Special Liquidators have published six progress update reports on the liquidation of IBRC, the most recent one in May 2019, these reports provide detailed information on the various workstreams ongoing in the liquidation including the legal workstream. All six reports are available on the Department of Finance website (https://www.gov.ie/en/collection/9d6c20-ibrc-progress-report-updates/).

IBRC Operations

Questions (133)

Catherine Murphy

Question:

133. Deputy Catherine Murphy asked the Minister for Finance the details of the sale of IBRCAC in 2014 including the proceeds versus the original value; the number of staff and investors originally involved; the number transferred to a company (details supplied) following the sale; and if he will make a statement on the matter. [36064/19]

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Written answers (Question to Finance)

On 11 March 2015, Life Company Consolidation Group Limited (“LCCG”), through its Irish subsidiary, Life Company Consolidation Group Ireland Limited, acquired the entire share capital of IBRC Assurance Company Limited (“IBRCAC”) from IBRC (in Special Liquidation). Following the sale in March 2015 IBRCAC was renamed Harcourt Life Assurance Company Limited.

The successful completion of the IBRCAC share sale is referenced in the 2015 progress update report of the Special Liquidators, published on 27 May 2016 (https://assets.gov.ie/9081/12579f1e834b427296e6c0a5cd3f1882.pdf)

In relation to the other components of the question, I am advised by the Special Liquidators they are not in a position to provide the requested information due to commercial confidentiality.

Credit Union Regulation

Questions (134)

Eamon Scanlon

Question:

134. Deputy Eamon Scanlon asked the Minister for Finance if his decision to approve a substantial increase to the industry levy on credit unions up to 50% by 2022 will be reversed; if he consulted with a committee (details supplied) in advance of the announcement; and if he will make a statement on the matter. [36076/19]

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Written answers (Question to Finance)

As the Deputy is aware, credit unions are regulated and supervised by the Registrar of Credit Unions at the Central Bank who is the independent regulator for credit unions. Within his independent regulatory discretion, the Registrar acts to support the prudential soundness of individual credit unions, to maintain sector stability, and to protect the savings of credit union members.

Since 2004 the amount of the Industry Funding Levy payable by each credit union has been capped at a rate of 0.01% of total assets.

Consultation Paper 95 "Joint Public Consultation Paper - Department of Finance and the Central Bank of Ireland - Funding the Cost of Financial Regulation" (CP95) was published in 2015 and set out proposals to move from partial industry funding of financial regulation towards full industry funding, noting the proposal set out in an earlier consultation conducted by the Central Bank (CP61 "Consultation on Impact Based Levies and Other Levy Related Matters") to move credit unions to fund 50% of the cost of regulating the credit union sector. 

The Central Bank indicated, in its Funding Strategy and 2018 Guide to the Industry Funding Levy, that it intended to seek my approval to increase the proportion of financial regulation costs to be recovered from credit unions on a phased basis setting out an initial target of 50% to be reached by 2021.

In response to the Central Bank's request I recommended that credit union contributions should not increase beyond the 50% target until:

1. The levy trajectory has reached the planned 50% rate, at which time the impact on the viability of the sector will be better understood; and

2. A public consultation regarding increasing the levy rate for credit unions beyond 50% is undertaken, which would include a regulatory impact assessment of such a change on the sector.

In contrast to this, recovery rates in 2018 for all other industry categories ranged from 65% to 100%, and  the Central Bank intends to increase all to 100% funding over the next number of years. 

Section 32D of the Central Bank Act 1942, as amended, provides that the Central Bank  may, with the approval of the Minister for Finance, make Regulations prescribing an annual Industry Funding Levy to be paid by regulated financial service providers to the Central Bank of Ireland. The Industry Funding Levy is not specific to credit unions and there is no requirement under the legislation for the Central Bank to consult with anyone other than the Minister for Finance. Nor is there any legislative requirement for the Minister for Finance to consult with the Credit Union Advisory Committee (CUAC) or with any other third parties prior to providing his approval.

It is worth noting that credit union sector was consulted on the proposed changes to the industry funding levy in 2012/2013 and in 2015 and that the final report of the CUAC Implementation Group published in January 2019 made specific reference to the Central Bank's intention to increase the industry funding levy for credit unions to 50% on a phased basis, which had been made public by the Central Bank in November 2018.

The Deputy might also wish to note that the Department of Finance, in collaboration with the Central Bank, held a public consultation on potential changes to the Credit Institutions Resolution Fund Levy, which is expected to reduce materially from 2020. The outcome, following the public consultation, will be published shortly.

It is also important to note that as Minister for Finance I have reduced the Stabilisation Scheme Levy materially and that since 2017 no further levies have been charged by the Credit Union Restructuring Board (ReBo). I have previously committed to a further review of the Stabilisation Scheme in 2020.

On 28th August last, I held a meeting with the credit union representative bodies to discuss their views on the Industry Funding Levy and other credit union related matters. I reaffirmed the decision, outlined above, for increases to the Industry Funding Levy. 

Tax Data

Questions (135, 136, 137, 138, 139, 140, 141, 142)

Pearse Doherty

Question:

135. Deputy Pearse Doherty asked the Minister for Finance if the capital gains exemption on properties sold if they have been held for three years or more will apply to a company (details supplied) once it acquires assets currently owned by a company for three years or longer. [36088/19]

View answer

Pearse Doherty

Question:

136. Deputy Pearse Doherty asked the Minister for Finance if anti-avoidance measures introduced in the Finance Act 2017 by which stamp duty of 6% applies to the sale of shares which derive their value or part of their value from commercial property applies to Irish REITs. [36089/19]

View answer

Pearse Doherty

Question:

137. Deputy Pearse Doherty asked the Minister for Finance the rate of stamp duty that will be applicable to the sale of a company (details supplied). [36090/19]

View answer

Pearse Doherty

Question:

138. Deputy Pearse Doherty asked the Minister for Finance the stamp duty that will be paid as part of the sale of a company (details supplied). [36091/19]

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Pearse Doherty

Question:

139. Deputy Pearse Doherty asked the Minister for Finance the breakdown of the shareholdings of a company (details supplied) between domestically held and international investors, respectively; and the increase in value of shares held by both domestic and international investors following the sale of the company to another company. [36092/19]

View answer

Pearse Doherty

Question:

140. Deputy Pearse Doherty asked the Minister for Finance if a company (details supplied) could be exempt from anti-avoidance non-resident rules in view of the grandfathering provision of 31 December 2020 regarding the non-resident exemption from capital gains tax on the sale of REIT shares; and if the company now controls 10% of another company and could potentially be exempt from capital gains tax on the sale of this holding. [36093/19]

View answer

Pearse Doherty

Question:

141. Deputy Pearse Doherty asked the Minister for Finance his views on the assessment of the 2012 tax strategy papers that the introduction of a REIT regime here with generous tax exemptions for international investors and stipulations in double taxation treaties that dramatically reduce the effective tax rate paid by international investors, would result in significant tax leakage. [36094/19]

View answer

Pearse Doherty

Question:

142. Deputy Pearse Doherty asked the Minister for Finance if he has carried out an analysis of the potential gross tax that will be exempted from payment as a result of a number of tax benefits afforded to REITs and property investors due to the sale of a company (details supplied). [36095/19]

View answer

Written answers (Question to Finance)

I propose to take Questions Nos. 135 to 142, inclusive, together.

I understand that all of these questions relate to the potential sale of one specific company.  I have been advised by Revenue that due to Revenue’s requirement to protect taxpayer confidentiality under section 851A Taxes Consolidation Act 1997, and due to the fact that this transaction has not yet taken place, it is not possible, or appropriate, to answer some of the specific questions asked.  However, I can address most of the issues raised in general terms.

Finance Act 2013 introduced the regime for the operation of Real Estate Investment Trusts (REITs) in Ireland. The function of the REIT framework is not to provide an overall tax exemption but rather to facilitate collective investment in rental property by removing a double layer of taxation which would otherwise apply on property investment via a corporate vehicle.

Property rental income and certain gains arising from the disposal of rental properties are exempt from tax within the REIT but they are chargeable to tax at the investor level when distributed.  The REIT legislation requires that 85% of all property rental profits be distributed annually to shareholders (and this is referred to as a “property income dividend”), to prevent an indefinite tax free roll up of property rental profits within the REIT.

REITs are designed to facilitate long term property rental structures.  While they will often acquire property, it is acknowledged that it may be desirable to develop property within the REIT for use in the rental business. To prevent REITs being used as property development structures, there are special provisions dealing with property development within the REIT regime.  If a REIT spends more than 30% of the value of a property it holds developing that property and sells that property within 3 years of the development, then any gains will be taxable at 25%.  The REIT is also subject to corporation tax on income and gains, if any, not arising from the property rental business of the REIT.

In response to question 36088, the exemption from capital gains tax on a developed property which has been held for 3 years only applies to a disposal by a REIT.  It does not apply to any subsequent disposal by any other person.

In response to question 36095, as set out above the REIT regime is not a tax exemption, but a regime to facilitate collective investment in Irish property.  A paper on REITs and other investment vehicles as they invest in the Irish property market was prepared for the Tax Strategy Group and published on my Department’s website in July 2019. The paper addresses the policy rationale for introducing and maintaining REITs, the benefits of the regime and the taxation of REITs.  It also sets provides details on the property held by REITs, as well as Irish Real Estate Funds (IREFs) and Section 110 companies as they invest in the Irish Property Market. The paper is available to download at the following link: https://assets.gov.ie/19114/2de9c469825a47418526e1d5c217b44c.pdf.

In response to question 36090, in the normal course, the sale of shares attracts stamp duty at a rate of 1%.   In response to question 36089, the stamp duty anti-avoidance measure referred to is section 31C Stamp Duties Consolidation Act 1999 which was introduced following the increase in the stamp duty rate on the acquisition of land and property from 2% to 6% in Budget 2018. The measure ensures that the higher 6% rate also applies where non-residential property held by an entity such as a company is indirectly sold by way of a sale of the shares in the company and, effectively, the non-residential property itself.  To ascertain if the anti-avoidance measure applies it is necessary to look at the nature of the business carried out by the particular company when it is acquired.  The measure applies where the company derives the greater part of its value, directly or indirectly, from Irish property that it acquired or developed with the sole or main aim of making a profit or gain from its disposal.

Not all companies deriving value from property would come within the measure.  Although the greater part of their value might be attributable to their property assets, the sale of such companies by way of a sale of their shares is not chargeable to stamp duty at the rate of 6% because they won’t have acquired or developed the property with the sole or main aim of making a profit or gain from its disposal but from using the property for their core business.  For example, the acquisition of hotels, office rental businesses, creches and shopping centres would not generally fall within the charge.

As explained above, for reasons of taxpayer confidentiality and as this relates to a proposed transaction, it is not possible to provide an answer to question 36091.

In response to question 36093, Finance Act 2012 brought in a relief from capital gains tax where a person acquired land or buildings between 7 December 2011 and 31 December 2013 (with Finance (No.2) Act 2013 extending this to 31 December 2014), and held that land or building for 7 years (with Finance Act 2017 reducing this to 4 years).  Full relief is available when the land or buildings are held for up to 7 years after which the relief available is reduced in the proportion that 7 years bears to the period of ownership. This relief only applies to direct acquisitions of land or buildings, and not to shares which derive their value from land or buildings.  Therefore, an acquisition of REIT shares did not fall within this exemption.

In relation to non-resident companies and grandfathering within section 23A Taxes Consolidation Act 1997 as amended by Finance Act 2014, tax on the disposal of shares in a REIT cannot be avoided by Irish persons holding them through an offshore structure.  There are targeted anti-avoidance rules which essentially charge an Irish resident to tax on gains which accrue to their offshore company (principally section 590 Taxes Consolidation Act 1997), or offshore trusts (principally sections 579 and 579A Taxes Consolidation Act 1997).

The 2012 Tax Strategy Group paper, referred to in question 36094, informed the design of the REIT regime in Ireland.  The paper sets out the various policy considerations which informed the introduction of the REIT framework, including the need to attract alternative sources of investment capital to the property market and the potential benefits of a risk-diversified collective investment structure for small investors and for tenants.  As identified in that paper, Ireland’s dividend withholding tax (“DWT”) rules provide that DWT does not in general apply where a dividend is paid to a resident of a country with which we have a double tax agreement.  In bringing forward the REIT regime, amendments were made to the DWT rules such that that exemption does not apply to property income dividends paid by a REIT.  Instead, DWT at the full rate of 20% is applied and those investors who are entitled to a lower rate under a double tax agreement may subsequently claim the appropriate refund.

 It is also worth noting in this regard and in respect of question 36093, that where an investor holds more than 10% of the shares in the REIT, they are referred to in the REIT legislation as a “holder of excessive rights”.  In most cases where a dividend is paid to a holder of excessive rights, the REIT is charged to tax at 25% as if it had received the dividend.  This means that the tax collected by the State on dividend payments to large shareholders cannot be reduced under a double tax agreement. 

Finally, in response to question 36092, Revenue does not hold details of the location of investors in companies, or the share price of a company. If such data was collected, it would be confidential taxpayer information.

Tax Collection Forecasts

Questions (143)

Willie O'Dea

Question:

143. Deputy Willie O'Dea asked the Minister for Finance the estimated amount that would be generated if the 2% stamp duty on houses that are sold for in excess of €1 million was increased to 3%; and if he will make a statement on the matter. [36107/19]

View answer

Written answers (Question to Finance)

I am advised by Revenue that a Ready Reckoner providing estimated impacts for potential changes to a wide range of taxes and duties is available at www.revenue.ie/en/corporate/documents/statistics/ready-reckoner.pdf.

Regarding your question on stamp duty, the Ready Reckoner provides the estimated impact of increasing the rate of Stamp Duty on the excess of considerations on residential properties over €1 million to 3% on page 19.

Departmental Internships

Questions (144)

Catherine Murphy

Question:

144. Deputy Catherine Murphy asked the Minister for Finance the number of unpaid internships issued and-or granted to persons to work in his Department over the past five years to 28 August 2019; the number of persons who took up unpaid internship roles in that timeframe; if his Department continues to offer unpaid internships; and if he will make a statement on the matter. [36148/19]

View answer

Written answers (Question to Finance)

I wish to inform the Deputy that the Department of Finance does not offer unpaid internships.

The Economics Division of the Department of Finance has offered a twelve week paid internship to the successful candidate in its Economic Policy Competition each year since 2014. This is an essay-based competition that assesses undergraduate students’ understanding of the Irish economy. The Department engages directly with third- level institutions to advertise the Economic Policy Competition and to target it to final year and penultimate year students. Candidates are required to submit a 150-word summary with a supporting 2,000-word submission on one of two policy questions that are provided by the Department. The Department accepts a maximum of three submissions from each participating institution – individual applications are not accepted. The Department invites the students with the top submissions for interview, from which the winner of the competition is chosen.  

Details of the 2019 Competition are available on the Department’s website at: https://www.gov.ie/en/publication/53da3e-test/ It is expected that the 2020 Competition will be launched in the coming weeks.

Employment and Investment Incentive Scheme

Questions (145)

Jack Chambers

Question:

145. Deputy Jack Chambers asked the Minister for Finance if his attention has been drawn to further issues and delays with issuing of RICT certificates under the EIIS scheme to investors in time for the annual tax return and that the same issues were encountered in previous years; the steps being taken to rectify same; and if he will make a statement on the matter. [36198/19]

View answer

Written answers (Question to Finance)

The Employment Investment Incentive Scheme (‘EII’) is a scheme that is covered by Article 21 of Commission Regulation No 651/2014 of 17 June 2014, declaring certain categories of aid compatible with the internal market in application of Articles 107 and 108 of the Treaty (referred to as the “General Block Exemption Regulation” or “GBER”). Revenue has informed me that the increased level of complexity arising from the requirement to determine compatibility with GBER means that each application takes longer to process.

For applications that are currently awaiting certification, Revenue has informed me that, of those on hand, over 70% are currently actively under review by a member of the EII Division. Decisions are reached on all complete applications without undue delay and certificates issued. However, the complexities of the scheme’s requirements, have meant that a large volume of applications are incomplete when first received, adding to delays.

Finance Act 2018 introduced changes to the administration of the scheme from 1 January 2019, including the move from certification of the relief by Revenue to self-assessment. Revenue expect that this change may alleviate some of the delays that may have existed.

Cyber Security Protocols

Questions (146)

Jack Chambers

Question:

146. Deputy Jack Chambers asked the Minister for Finance if there are dedicated, professionally trained and certified cybersecurity staff for cybersecurity protocols under the remit of his Department; if such specialists are being recruited; if his Department maintains a risk register of security breaches; if so, if there are staff who analyse, log and maintain such a register; and if he will make a statement on the matter. [36228/19]

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Written answers (Question to Finance)

In relation to my Department, I wish to advise that ICT services are provided by the Office of the Government Chief Information Officer (OGCIO) under the Department of Public Expenditure and Reform. On behalf of my Department the OGCIO has specialist resources, with the appropriate skills and expertise, tasked with managing cyber security. OGCIO implements a defence-in-depth security strategy which is achieved through the effective combination of people, processes, and technology to support the implementation of appropriate security measures and provisions, including monitoring and analysing logs.