Stephen Donnelly (Wicklow, Social Democrats) | Oireachtas source

I thank Mr. Howard and the Minister. I am sorry to hear Revenue's position. At this point Revenue should be able to give some sort of a scale. A very small number of companies are involved in this matter. About ten companies have bought practically all of the NAMA assets, these vulture funds and most of them have now released their accounts. As an example, Cerberus took in interest payments for 2014 - and we have their accounts - in the sum of €112 million. It paid interest amounting to about €27 million to Nomura. That means Cerberus gained €85 million in interest alone in 2014. As things stand, it pays zero tax on that sum because it has an arm's length loan to itself that violates the principles that the Minister, quite rightly, put out after the tax ruling, that economic activity should be taxed here.

Nomura has had a conservative £1 billion increase in its asset base. The amendment, as it stands, will allow Nomura to mark its asset base to the September value thus wiping out £1 billion in capital gains. Corporates pay capital gains tax of around 25% when one balances everything out. The amendment will allow Cerberus to wipe out £250 million in capital gains tax that was due to the State. The amendment will allow the wipe out of tens of millions of pounds a year in corporation tax and dividend withholding tax. If one rolls that up for ten years the sum will amount to close to £2 billion of gains. The amendment, as it stands, means Cerberus will walk out of this country having paid no tax on such gains. I am just referring to Project Eagle. When one scales it up one starts to get into the tune of between €10 billion and €20 billion.

I am cognisant that the Minister has repeated again today that he is open to my suggestion. I have to emphasise that the accounting firms, that have an input in the drafting of this amendment were, within 12 hours, sending circulars to their clients saying something like: "There is nothing to worry about, we will set up arm's length mezzanine financing, we will come in and we will mark to market all of your capitals, and don't worry about all of the capital gains for the past six or seven years as we have already taken care of them for you." As things stand these funds are going to walk out of this country, having made many billions in profits off the backs of people trying to pay their mortgages and businesses trying to pay down their loans, without paying taxes.

I agree with the principle outlined by the Minister that the economic activity must be taxed in this country.