Pearse Doherty (Donegal, Sinn Fein) | Oireachtas source

The Department has run a public consultation on the future of the bank levy that took place earlier this year so we are expecting further changes in the coming year, including possibly the number of entities that would come under its scope. I invite the Minister to say a few words on that or set out his current thinking regarding how the bank levy will apply beyond 2024. Will it only apply to the number of entities currently within its scope or does the Minister intend to extend it to other entities that hold deposits? It was supposed to expire in 2023. It has had a number of extensions and I believe it is right to continue to extend it.

The Minister has increased the bank levy and changed the way it operates away from the deposit interest retention tax to deposits. The revenue target is now €200 million, which would be an increase on the original target, which was €150 million. I made the point that it was wrong to reduce the bank levy in previous finance Bills, which reduced the income from this to €87 million. It made no sense whatsoever and the fact that the Minister is increasing it to €200 million justifies that point. What was the rationale behind the revenue target of €200 million? When you look at the profitability of the banks when we had a banking levy of €150 million and if you want a pro rataincrease along the lines of the profitability of the banks to this point in time, the banking levy should not be €200 million, it should be €400 million. We know that the profitability of the banks has increased dramatically. Even in 2022, it was €2.5 billion while this year, it is forecast to be double that at €5.1 billion, which is a 97% increase in terms of operating profits.

Given the scale of the growth both in terms of the net interest margin and operating profits, why does the Minister believe the banking levy as drafted in this legislation is adequate in terms of its reach and the revenue target and does not widen the scope of the levy beyond Bank of Ireland, AIB, Permanent TSB and EBS? Is this something the Minister is considering in the future? When will we have a definitive view from the Department regarding the future of the banking levy, its scope, its target revenue and its duration?