Martin Mansergh (Tipperary South, Fianna Fail)

This amendment ensures that where an individual is present in the State at any point in a day, that day will be counted for determining tax residence. It will mainly affect high-wealth individuals who can fly into the State in the morning and fly back out by midnight. It will not affect cross-Border workers who are employed in the State.

Coming from the same region as Deputies Tom Hayes and Michael Noonan, I am glad a change has been made to the way the air travel tax will be levied. It will be levied as if from a single point defined as the east coast, Dublin Airport, and, therefore, will not be discriminatory against different airports.

I note the British Chancellor of the Exchequer further raised the UK's equivalent of the travel tax yesterday. Even its lowest rate is higher than our higher rate of €10. The UK's highest rate will be raised to £55. I do not see the Irish travel tax having a negative effect on airline competition from outside the country. Many other European countries are applying this form of tax. It may be the case that we are not tuned into some of the debates that take place across the water, but I do not recall hearing voluble protests by certain notorious airline managers at these increases. I will not refer to the manager of a certain well-known popular airline by name, as he is not in the House, but I wonder what he makes of these increases on airport tax across the water.

We live in a situation of tax competition. The Finance Bill raises VAT rate by 0.5%. Across the water, it has been reduced to 15% until the end of 2009. There has long been a benefit from having lower petrol prices and duty south of the Border. I suppose there is an element of swings and roundabouts. However, there are separate jurisdictions and each Government is rightly jealous of its tax sovereignty.

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