Brian Cowen (Laois-Offaly, Fianna Fail)

As I announced in my Budget Statement, my Department and the Office of the Revenue Commissioners will undertake a detailed review of certain tax incentive schemes and tax exemptions in 2005. This review will evaluate their impact and operation, including their economic and social benefits, for the different locations and sectors involved and the wider community. In addition, the review will examine the degree to which these schemes allow high-income individuals to reduce their tax liabilities.

I subsequently announced in a press release on 6 January 2005 that my Department has advertised for external consultants to review certain tax incentive schemes. Two consultancy studies are envisaged. One will examine the area-based incentives, that is, the urban renewal, town renewal, rural renewal and living over the shop schemes. The other will examine the other incentive schemes, namely, those covering multi-storey car parks, park and ride facilities, student accommodation, buildings in use for third level education purposes, hotels, holiday cottages, nursing homes, private hospitals, sports injuries clinics, child care facilities and the countrywide refurbishment scheme. The last five schemes have no termination date while all of the other schemes have a final date for incurring qualifying expenditure of 31 July 2006. This termination date was laid down in Finance Act 2004 and I indicated in the budget that the date remains unchanged.

Separate from the consultancy studies being undertaken in regard to these schemes, a special public consultation process was advertised on 8 January 2005 seeking submissions on measures that could be introduced that balance the benefit of such reliefs with the extent to which these are used by high earners to reduce their tax bill. The deadline for submissions for this process is 31 March 2005.

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