Financial Resolution No. 10 gives legislative effect to the budget announcement that the rates of deposit interest retention tax, DIRT, will increase by three percentage points with effect from 1 January 2013. The resolution amends section 256(1) of the Taxes Consolidation Act 1997 to give statutory effect to the new rates of DIRT applicable to deposits held in banks and other financial institutions. The changes in rates are as follows. The general 30% rate, which applies to deposit interest, including deposit interest arising on special savings accounts and special term accounts is being increased by three percentage points to 33%. In addition, the 33% rate also is being increased by three percentage points to 36%. This rate applies in the case of interest which is not payable annually or at more frequent intervals or where the interest cannot be calculated until maturity of the investment. This includes investments such as tracker bonds where the amount of interest payable depends on the changes in a financial or other index over a number of years.

The resolution also amends section 267B of the Taxes Consolidation Act 1997 to increase the 30% rate, which applies to special share accounts and special term accounts held in credit unions, to a rate of 33%. The measures relating to DIRT in this budget build upon measures undertaken in budget 2012, when the standard DIRT rate increased from 27% to 30%. The increase in the DIRT rate is expected to yield the Exchequer approximately €47 million in 2013 and a full €60 million in the following year, 2014.

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