Pearse Doherty (Donegal South West, Sinn Fein) | Oireachtas source

I did not expect the Minister to accept the amendment. However, it was worth putting it on the record that it can be raised but not to the 8 percentage points suggested by the Minister.

We got a good glimpse of behaviour of account holders in this State during the Ulster Bank fiasco when normal banking services for a number of its 1 million customers in this State were shut down yet few opted to change product. If this had happened in respect of any other service people would have jumped provider. In banking, there is a reluctance to move for one reason or another. Customers who may have loans with a particular institution often believe it is too difficult or complex to open a savings account with another institution while that is the case. The increase in DIRT may not lead to a shift of savings accounts from financial institutions to non-DIRT accounts. However, it would be wise for people to move to, say, An Post who offer products in respect of which DIRT does not apply. It would be wise for a person who has a savings account to which 41% in DIRT will be applied to move to An Post.

We heard earlier from Deputy McGrath about the lobbying by the banks last year in relation to An Post. Will the Minister rule out any attachment of tax to An Post savings accounts? Can he give an assurance to those who opt to open a savings account with An Post that such account will not be liable for DIRT? The Minister is correct that as the interest rate on savings is only 8%, which is still high, this should not be an incentive to save. One could argue, although that is not what I am doing, that there is an incentive to save because An Post products and others, which are not liable to DIRT, are now more attractive than those products offered by other financial institutions. Is this the start of the application of DIRT to some of these products?