Denis Naughten (Roscommon-South Leitrim, Fine Gael)

I move amendment No. 30:

In page 100, line 14, after "2008" to insert the following:

"except in the case of disposals arising from compulsory purchase orders, it shall apply to disposals, on which the order was confirmed on or after 15th October".

This amendment, which we did not have the opportunity to discuss on Committee Stage, deals with the capital gains tax threshold, which has been increased from 20% to 22%. The difficulty arises with regard to lands that were the subject of a compulsory purchase order during the periods in question. With one example in Ballaghaderreen in my constituency, An Bord Pleanála confirmed the compulsory purchase order on 26 September. As a result of the way the legislation is currently written, it will be liable for the higher rate of capital gains tax.

In light of the fact that the Department of Finance must provide the funds in the first place to allow for the higher rate of capital gains tax because the compensation must include the tax element, it makes sense to accept this amendment. In the first instance, this means the Department of Finance pays compensation — and the related tax — at the lower rate. It also means the land owners in question are not liable to the higher rate of tax.

There is no financial benefit in this issue. The amendment facilitates streamlining the proposal for everybody involved. There will be an additional cost on the Department of Finance in furnishing the funds in the first instance before having to recoup them through capital gains tax. There would be net saving to the Exchequer so I ask the Minister to accept the amendment.

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