Pat Rabbitte (Dublin South West, Labour)

Like Deputy McGrath, I have been taken aback by the scale of this matter. I welcome the first of these two motions but am taken aback by the apparent extent involved. There is reference to income arising from possessions outside the State. As I understand it, "possessions" means income arising from any source, and according to the note provided to me by the Chief Whip, the tightening up envisages a yield of €50 million next year, €75 million in 2007 and €100 million in a full year. I must be forgiven for being dense but I do not understand that. If the figure for 2007 is €75 million, what is meant by €100 million in a full year? I thought we were talking in calendar year terms in this instance.

A figure of €50 million is envisaged for 2006. In section A.25 of his speech today, the Minister for Finance said that the ending of the scheme in question should save the State up to €100 million per year in lost income tax revenue. There is probably a very simple explanation for the figure being given as €60 million for next year while the Minister gave a figure of €100 million in a full year. Can the Taoiseach clarify this point?

As Deputy McGrath noted, the puzzle lies in whether we are referring to a number of very highly paid executives of international companies or talking of a great number of employees if the yield could be up to €100 million. Given that one is not domiciled in this State and not ordinarily resident in this State, that must imply that in most cases one arrived with the company and one's country of domicile is the United States, Germany or wherever. One is not an Irish citizen domiciled in this State, and so on. I did not know there were that many people involved, unless of course as Deputy McGrath said, we are talking of a finite number of very high earners.

In any event, the move is very welcome. I am interested in the Taoiseach's point that it partially explains that apparent discrepancy whereby the numbers at work have been expanding more or less exponentially for a dozen years, while the income tax receipts do not seem to reflect that. It would be interesting to know if the Department of Finance has made a stab at establishing roughly what proportion of that gap it explains.

I have no difficulty with the second motion. The ingenuity of the tax advice industry never ceases to amaze me. I saw a spokesperson for that industry speaking on television recently, a person with whom Deputy Ardagh and myself are familiar, and that industry's ability to see a loophole in a new scheme seems unlimited. The purpose there was obviously not to acquire overseas property in the manner suggested by the Taoiseach.

I will again feign stupidity and ask about the original intention of the scheme. The Taoiseach said it was to generate economic activity but I am not quite sure if we were facilitating high net worth individuals in taking an equity stake in a company which manages a property portfolio——

See this speech in context