Pearse Doherty (Donegal, Sinn Fein)

I agree wholeheartedly with what Deputy O’Callaghan said. Both of us are looking for the same thing here, that is, an increase in the banking levy. The banking levy is at way too low of a level. I know the Minister will say that €200 million is being brought in. Compared to the profits of the banks, however, it is only a fraction. It would be interesting to hear the Minister’s view on the direction of the banking levy, given State's involvement in the banks now, particularly with PTSB’s move and the field that will result in and how the levy will be applied in the future? I believe it needs to be continued. I said that it needed to be raised. We have argued for it to be at least double the rate that it is at the minute. The reality is that the banking levy does not take in €200 million because the levy can be offset against corporation tax to write down a corporation tax bill.

That takes me to my next amendment, which relates to a report on the taxation of the bailed-out banks. It is madness. I table this amendment every year. When Fine Gael and the Labour Party brought forward the proposal to end the very sensible amendment that the late Brian Lenihan brought forward, which was that only 50% of losses would be able to be carried forward, the argument at the time was that it was required for capitalisation to ensure that the banks were adequately capitalised. That argument does not stack up anymore. There were further arguments to say that it would not matter to the taxpayer because we were getting dividends from the banks. We are not anymore, however. Therefore, it does matter. Again, it screams of the priorities of this Government when we have banks making profits of €5 billion between them and paying no tax or have an effective tax rate of less than 1%. It is just not acceptable in terms of the corporation tax they should be paying. We should go back to the position at the time the banks were bailed out, which was a recognition that these losses would be used by the banks to write down their profits and taxation liability in the future. In fairness, and I have said it over and over again, at a time when the banks were bust and literally looking at liquidation, in the middle of all of that, Brian Lenihan recognised – I am sure his advisers advised him – that they would be profitable in the future and that they should not be allowed to carry these losses forward at a rate of 100%.

I have made the point as well that what we offer here is unique. The Minister will say that the banks are treated in the same way as any other business in how losses are carried forward, and that is actually true. The point, however, is that the bailed-out banks are not like any other business. They only exist today because they were bailed out at a huge price, not just in a monetary sense of the euros we pumped into them, but at a huge cost to Irish society, people, families and all so on. For that reason, they are not the same as any other business. That is why that legislation was amended at the time to ensure the banks were treated differently.

When we examine what we do in terms of carrying forward losses, we allow for losses to be carried forward indefinitely at a rate of 100%, which means they could be carried forward for 20 or 30 years. There is no cut-off point. We are an outlier by far in the OECD in this regard. In many countries, our competitors have a deadline of carrying forward losses of ten years or, if it is not ten years, they have a restriction on the amount that can be carried forward. We allow losses to be carried forward at a rate of 100% without any deadline, not even a ten-, 15- or 20-year deadline. It is quite unique that both of those would apply in the OECD the last time I looked at it, which was a while ago. It will not surprise me that the Minister will not accept the amendment, but defending a situation where banks are making €5 billion profit off the back of ordinary workers and families through interest rates that are way higher than the European average, and when banks are paying little to no taxation on those profits, is indefensible. That is what this amendment is about. I will press it to a vote when it comes to it.