I move Financial Resolution No. 11:
(1) THAT section 34 of the Finance Act, 1974 (No. 27 of 1974), and section 8 of the Finance Act, 1978 (No. 21 of 1978), shall not apply or have effect in relation to any payment of interest on a loan applied on or after the 29th day of January, 1992, for a purpose specified in those sections if the company, part of whose ordinary share capital was or is acquired or, as the case may be, to which the money was or is lent, is a quoted company.
(2) THAT, as respects the year of assessment 1992-93 and subsequent years of assessment, notwithstanding the provisions of section 34 of the Finance Act, 1974, and section 8 of the Finance Act, 1978, but subject to paragraph (3) of this Resolution, relief under those sections in respect of interest paid on a loan applied before the 29th day of January, 1992, for a purpose specified in those sections shall, if the company, part of whose ordinary share capital was acquired or, as the case may be, to which the money was lent, is, at the time the interest is paid, a quoted company, be given according to the following provisions, that is to say—
(a) in relation to any interest paid in respect of a period consisting of all or part of the year of assessment 1992-93, relief shall not be given in respect of the excess of the amount, or of the aggregate amount, of the interest over 70 per cent. of the amount, or of the aggregate amount, of the interest in respect of which, apart from this paragraph, relief would otherwise have been given under those provisions,
(b) in relation to any interest paid in respect of a period consisting of all or part of the year of assessment 1993-94, relief shall not be given in respect of the excess of the amount, or of the aggregate amount, of the interest over 40 per cent. of the amount, or the aggregate amount, of the interest in respect of which, apart from this paragraph, relief would otherwise have been given under those provisions, and
(c) in relation to interest paid in respect of any period in the year of assessment 1994-95 or a subsequent year of assessment, no relief shall be given.
(3) THAT where, on or after the 6th day of April, 1991, a company becomes a quoted company, the provisions of paragraph (2) of this Resolution shall apply and have effect in relation to the years subsequent to the happening of that event as if—
(a) the reference to the year of assessment 1992-93 were a reference to the second year of assessment after the year of assessment in which the company becomes a quoted company.
(b) the reference to the year of assessment 1993-94 were a reference to the third year of assessment after the year of assessment in which the company becomes a quoted company, and
(c) the reference to the year of assessment 1994-95 were a reference to the fourth year of assessment after the company becomes a quoted company.
(4) THAT in this Resolution "quoted company" means a company whose shares, or any class of whose shares—
(a) are listed in the official list of the Irish Stock Exchange or any other stock exchange, or
(b) are dealt in on the smaller companies market, the unlisted securities market or the exploration securities market of the Irish Stock Exchange or on any similar or corresponding market of any other stock exchange.
(5) IT is hereby declared that it is expedient in the public interest that this Resolution shall have statutory effect under the provisions of the Provisional Collection of Taxes Act, 1927 (No. 7 of 1927).
This resolution relates to the income tax relief available to employees and directors on loans taken out to purchase shares in, or make a loan to, the company which employs them. The Government have decided to abolish this relief in respect of loans related to quoted companies, which have access to capital through the stock market.
Accordingly, no relief will be available on loans relating to such companies taken out on or after today, and relief on existing loans relating to such companies is being phased out: relief will be available on only 70 per cent of the amount of qualifying interest in 1992-93, and on only 40 per cent in 1993-94; no relief will be available in 1994-95. Where companies obtained a quotation after 5 April 1991, the phasing out will not begin until the 1993-94 tax year. Where companies obtain a quotation from now on, relief will not be available in respect of loans taken out on or after the date of flotation; phasing out of relief on loans taken out before that date will begin in the second-next tax year after flotation.
This Financial Resolution provides accordingly, and I commend it to the House.