Mr. Niall Cody:

We probably had a much longer discussion about the research and development credit on 1 June. The claims are made in the context of the corporation tax return and then we carry out audits and interventions, having regard to the risks in companies. We treat it like we treat other credits and reliefs. We carry out a programme of research and development audits to address the risks. As I said earlier, we carried out 270 interventions in 2016, resulting in a clawback of €13 million in credits. Sometimes there are definitional issues.

Part of the reason for the increase is also that because of expansion in the policy regarding tax-payable credits, the scheme has been broadened to make it more effective. My colleagues from the Department of Finance spoke earlier about the research published in 2017 which evaluated the policy. A facility is in place to carry forward research and development credits. The refundable credits are paid over a period so an increase is built into the system until things are washed out. Ultimately, however, the credit is a direct result of the expenditure. There is a Government target to increase research and development because when it takes place in Ireland, it is really positive. It means we are employing people with education and we are bringing in people. That is what it is about.