Stephen Donnelly (Wicklow, Social Democrats) | Oireachtas source

I will not repeat myself, but a report would be useful. Ireland is currently caught between a protectionist UK and a soon to be protectionist US. Our Exchequer returns will get hit on the SME side by Brexit and it is highly likely that our multinational corporations, MNC, Exchequer returns could be hit substantially by a protectionist America. We are taking one of the biggest asset bases in the country pretty much completely out of the tax base.

My fear about the qualifying investor alternative investment funds, QIAIFs, and Irish collective asset management vehicles, ICAVs, being fully tax free has been confirmed tonight. I have learned two additional things tonight that I had not been clear on. The first is that not only will capital gains not be taxed at the capital gains tax level but that capital gains will not even be applied to the withholding tax. It is a more extreme level of Government-sponsored tax avoidance than I had thought. Widely owned funds - these ICAVs and QIAIFs - are not subject to corporation tax and capital gains tax. How this is being sold is that they were not paying those anyway but that they will now pay withholding tax. The second thing we have just found out tonight is that they will not pay withholding tax because they will set up their ownership outside the country. We are losing all of the taxes. Yes, there will be a few Irish rich people who buy and sell buildings and we will probably get a few quid out of them, but other than that, this is taking a big asset base out of the tax base. I cannot get my head around why we are essentially making property investment in Ireland tax free. We are giving up three levels of taxes: corporation tax, capital gains tax and withholding taxes.

I know that the tabled amendment probably will not be accepted, but we need to take a serious look at the impact of what we are doing, not just on this section but on what has happened over the past four or five years. It has almost certainly massively eroded the tax base. Critically, based on the amount of property bought since the crash and the multiple billions in capital gains that the sale of those assets will realise, how many billions of euro is this Government and the previous Government throwing away in capital gains tax by saying we are just not going to tax property any more?

I highly recommend that a report which begins to lay out just how big a deal this is be presented to the House.

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