Bernard Allen
Ceist:52 Mr. Allen asked the Minister for Finance if he will consider granting additional powers and incentives to the Cork Freeport which would guarantee the provision of new jobs at no cost to the Exchequer.
Written Answers. - Cork Freeport.
Peter Barry
Ceist:94 Mr. Barry asked the Minister for Finance if he will extend the 10 per cent tax incentive to all industries operating in the Ringaskiddy freeport as is done in the Shannon duty free area and in seven zero corporation tax zones in Belgium; his views on whether this would be a major boost to job creation in the Cork area which could be achieved at no cost to the Exchequer and, because of the Belgian zones, would be acceptable to the EC.
I propose to take Question No. 52, in so far as it relates to taxation issues, and Question No. 94 together.
Cork Freeport already enjoys a broad range of indirect tax reliefs, in the areas of VAT and of customs duties. VAT at point of entry is not charged on goods entering the designated area of the Freeport which are destined either for the home market or for re-export. There is also VAT-free importation for materials and components used in processing or the manufacture of goods, for machinery and plant used in connection with such processing or manufacture, and for equipment brought into the Freeport for repair and servicing. In addition, goods supplied within the Freeport by one VAT-registered person to another, and similar supplies from the Freeport to Shannon, are zero-rated for VAT purposes. Goods from outside the European community are also exempt from Customs duties for as long as the goods remain within the Freeport.
Where incentives in the area of direct tax are concerned, I have already outlined the position in the reply given to Deputy Quinn on 14 March last. The Freeport Advisory Committee had made representations seeking to have the 10 per cent rate of corporation tax extended to certain trading operations in the Freeport. Since then, it has been explained to representatives of the committee that specific EC approval would be required for such a concession and that there are clear indications that this would not be forthcoming.
All in all, I consider that the range of available reliefs is generous. I might add that in relation to any other proposed direct tax incentives, it is not apparent how these could necessarily guarantee the creation of new jobs at no cost to the Exchequer, especially given the EC's attitude to the provision of State aids.
In so far as Deputy Allen's question relates to non-tax matters concerning the Freeport, such as marketing, promotion or grant aid, these might be addressed to the relevant Ministers concerned.