Dáil Éireann Debate, Thursday - 25 February 2021
52. Deputy Denis Naughten asked the Minister for Finance the number of companies that have availed of the employment investment incentive scheme in each of the past five years; the funding invested in each year concerned; his plans to improve the uptake of this scheme; and if he will make a statement on the matter. [10845/21]
View answerThe Employment Investment Incentive (EII) provides for tax relief of up to 40% (previously 41%) in respect of investments made in certain corporate trades. The EII allows an individual investor to obtain Income Tax relief on investments for shares in certain companies up to a maximum of €150,000 per annum in each tax year for investments made up until 31 December 2019. For investments made after 31 December 2019, the maximum limit is raised to €250,000, or up to €500,000 in the case of those who invest for a minimum period of seven years.
The most up-to-date statistics regarding the EII are available on the Revenue website at the following link:
https://www.revenue.ie/en/corporate/information-about-revenue/statistics/tax-expenditures/eii.aspx
The following table summarises the data on the number of companies availing of EII and the total funding invested during the period 2011-2018:
|
Year |
Qualifying companies |
Total amount invested (€m) |
|
2018 |
37 |
48 |
|
2017 |
121 |
82.6 |
|
2016 |
209 |
105.6 |
|
2015 |
269 |
93.2 |
|
2014 |
296 |
77.9 |
|
2013 |
248 |
57.6 |
|
2011/2012 |
232 |
52.2 |
In my Budget 2021 speech I committed that my Department would initiate an assessment of how the EII Scheme can be enhanced in light of the impact of the current crisis.
Conscious that the pandemic has affected private investor confidence, and, in turn, the flow of available private equity investment into Irish companies, it is appropriate that we take stock of how the EII might be further enhanced to take account of the changing business environment.
My officials initiated a public consultation at the end of 2020 and submissions were invited from interested parties on the following:
- Enhanced support for start-ups under EII.
- Broadening the eligible funds from Irrevocable Trusts/Designated Investment Funds by opening EII Funds to other relevant regulated fund structures.
- The relationship between the Renewable Energy Support Scheme (RESS) and EII.
- How EII might respond to the changing environment in which it operates.
- Any other matters considered relevant.
Some thirty submissions were received by my Department by the closing date of 12 February which indicates a high level of engagement in the process. The Department is currently reviewing the submissions with the intention of further direct engagement with stakeholders shortly. Following that, proposals for changes to the scheme which may be of benefit will be developed for my consideration.
However, I would also note that significant changes to the scheme were made in the Finance Act 2019 to increase the attractiveness and effectiveness of EII. We await Revenue data on the impact of those changes. In recent years, the intention has been to seek to ensure that the scheme operates in an efficient and effective manner in terms of provision of support to young companies and this principle continues to guide the present review and consultation process that is underway.
