Dáil Éireann Debate, Tuesday - 7 February 2017
185. Deputy Pat Deering asked the Minister for Finance if he will consider introducing an initiative similar to the previous section 23 tax reliefs as a tool for revitalising rural towns; and if he will make a statement on the matter. [5969/17]
Amharc ar fhreagraThe recently launched "Realising our Rural Potential: Action Plan for Rural Development" by the Minister for Arts, Heritage, Regional, Rural and Gaeltacht Affairs contains a detailed list of actions and priorities with a view to revitalising rural Ireland generally. This effort is being led by the Minister for Arts, Heritage, Regional, Rural and Gaeltacht Affairs in conjunction with Ministers and officials from other Departments, as well as the Local Authorities and a range of other stakeholders.
A variety of actions included in this plan aim to assist in improving rural towns and making rural Ireland a better place to live. These include the Town and Village Renewal Scheme, under which funding of up to €12 million per annum is available to revitalise rural towns and villages, while there is also a commitment to develop and pilot an initiative to encourage increased residential occupancy in town and village centres.
With regard to introducing a specific tax relief to assist in revitalising rural towns as suggested by the Deputy, EU State Aid rules make it difficult to introduce tax reliefs that target specific geographic areas while excluding others. The Deputy may be aware of the difficulties that my Department encountered in relation to obtaining state aid approval from the European Commission for the Living City initiative. Obviously, the provision of a tax relief that was applicable on a nationwide basis, would be less targeted and potentially damaging to rural towns.
In addition, the Section 23 tax reliefs to which the Deputy refers have proven very costly to the State. Two extensive reviews of property taxation incentives were undertaken by independent economic consultants Goodbody and Indecon in 2005, which recommended that the vast majority of these initiatives be ceased. These recommendations were followed and most of these schemes have been gradually phased out of the tax code since 2006. I am not in favour of their reintroduction at this time.
