Eamon Gilmore (Dún Laoghaire, Labour)

I want to raise with the Taoiseach a tax scam that was first raised by my colleague, Deputy Burton, and that cost the Exchequer approximately €250 million in 2006. This is the tax scam whereby developers purchasing development land can get away with paying no stamp duty. As I understand it, the developer pays the money to the land owner who enters into a licence agreement with the developer to allow the latter to develop the land and grants power of attorney to the developer. The sale is not formally completed to the point where title is formally transferred. Therefore, it is not stamped and stamp duty is not payable.

Deputy Burton spotted this loophole in our tax code first and drew the Minister for Finance's attention to it. The Revenue Commissioners recommended that the loophole be closed and the Minister for Finance introduced legislation in 2007 to close it. However, it appears that the boys in the Galway tent got to work as the relevant section of the Act was never commenced. It is estimated that the amount lost to the Exchequer in 2006 was €250 million, a great deal of money for a Government that the Minister for Foreign Affairs, Deputy Dermot Ahern, tells the House does not have a red cent to build a hospital.

Will the Taoiseach explain to home buyers who needed to pay stamp duty for the purchase of their homes — some paid stamp duty for homes that are now worth much less than the purchase prices — or to those who are still paying stamp duty due to trading up and so on why people buying family homes have been required to pay stamp duty whereas big developers buying land for development purposes can get away without paying stamp duty and why that provision of the Finance Act 2007 has not been commenced?

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