Vol. 428 No. 2
81 Mr. Yates asked the Minister for Finance if he has satisfied himself with the present uptake in occupancy of the remaining blocks in the International Financial Services Centre in view of a recent report on this matter; and the action, if any, he proposes to take to improve the situation.
The current position in relation to the development of the area is that five office buildings have been completed. Four of these are fully let and less than 20 per cent of space available in the fifth building remains unlet. Clearly substantial progress has taken place in relation to occupancy of existing buildings and I am confident that agreements will soon be concluded in respect of the balance of existing space.
82 Mr. Yates asked the Minister for Finance if his attention has been drawn to a recent report in relation to the International Financial Services Centre in relation to the substantial level of lateral movements of companies into the centre merely for tax purposes; and if any estimates have been carried out in relation to the potential loss of revenue from these movements.
It is not clear what report the Deputy is referring to. In referring to the lateral movement of companies into the centre, however, I assume he is referring to displacement of business which would otherwise take place in Ireland and be subject to tax at the standard 40 per cent rate rather than the 10 per cent rate.
The vast bulk of business carried on by IFSC companies is business which would not otherwise be conducted in Ireland and the level of displacement is not therefore great. Care is taken in assessing every new project at the centre to ensure that substantial new activity is being proposed and that any existing international financial business of the promoter represents only a minor element of the proposed IFSC operation. The result is a net gain to Ireland. The question of tax loss to the Irish Exchequer does not arise. In 1992 the corporation tax receipts from IFSC companies amounted to £77 million.
