Eamon Gilmore (Dún Laoghaire, Labour)

That was an answer to a question about house repossessions I asked the Taoiseach last week. I asked whether the Government will do anything to close a tax loophole, which will cost the taxpayer approximately €80 million on top of the €300 million we are stuck with for the non-recourse element of the loans taken out by these people. The issue is simple. Ten people who belong to the golden circle borrowed this money, three quarters of it on a non-recourse basis, which means we are stuck with this and there is no question of it being repaid. That is €300 million we are caught for as taxpayers. On top of that, those involved will be able to write off the entire losses they make on this arrangement against future capital gains tax liability. This is open-ended and they will be able to do so indefinitely. This is a huge loophole in the arrangements governing capital gains tax.

Deputy Burton put it to the Minister for Finance that this loophole should be closed and he replied that he does not want to do so. Before the Taoiseach, the Minister for Finance, the Minister for Social and Family Affairs or any other Minister comes into the House to tell us and the people that parents will have take a cut in child benefit, pensioners may suffer a cut, the pay of State employees will be cut and God what knows else will be inflicted on people in the budget, will they not first close this loophole? Why should there be one law for these people who are operating a sweetheart arrangement, which will result in a tax write-off for losses that are being borne by the taxpayer? It is madness.

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