Vol. 495 No. 1
226 Mr. Naughten. asked the Minister for Finance the date on which his Department applied for approval of the rural renewal scheme to the European Commission; when the scheme will be approved by the Commission; and if he will make a statement on the matter. [19216/98]
Under EU Commission regulations on state aid all selective or regional business tax incentives must have the Commission's approval prior to their introduction. However, no such EU constraint arises in connection with the residential tax incentives in the rural renewal scheme and for this reason I introduced the residential tax incentives with effect from 1 June 1998.
There have been problems in obtaining the necessary EU Commission approval for the business tax incentives despite the fact that they were discussed with the EU Commission in Brussels at meetings in February, May and July 1998. The two business tax incentives in the rural renewal scheme are the capital allowances for the construction or refurbishment of industrial and commercial buildings and the double rent relief for the lessees of such buildings. These same two relics were the subject of formal notification sent to the EU Commission at end January 1998 in connection with an extension to the Custom House Docks area in Dublin. I decided that it would be advisable to wait until these two reliefs were processed by the EU Commission for the Custom House Docks area before formally notifying them again to the Commission for the rural renewal scheme given that the reliefs were the same in both cases. As the Deputy will appreciate, the views of the Commission in regard to the first scheme should clearly be of assistance in framing the subsequent formal notification for the rural renewal scheme.
However, as the Commission had not yet approved the Custom House Docks scheme by mid-September I decided that the Commission should be formally notified immediately of the rural renewal scheme. The formal notification was made on 17 September, although as I have said the Commission has had actual knowledge of this scheme for some time arising from my Department's representations to it in the matter. The timescale for dealing with the application is a matter for the EU Commission and every effort will be made to assist the Commission in processing the application as quickly as possible.
