Pearse Doherty (Donegal, Sinn Fein) | Oireachtas source

I note the Minister said he will ask the Revenue Commissioners to investigate any concerns regarding section 110s. The problem is that BlueBay, for example, is owned by the Royal Bank of Canada. Obviously, there is a different currency here; this section 110 company was set up in Ireland and money filtered through the Royal Bank of Canada into the section 110 company. A total of €160 million of it went into the Mater Private, Abrakebabra and others and a 6% interest rate was recorded on that, which gave the company taxable profits in their millions on which it paid €250 in tax. That is what is happening with BlueBay or, really, with Royal Bank of Canada. The Minister would argue for this in terms of double tax treaties but if the Royal Bank of Canada wanted to lend here, it would face serious barriers regarding currency and other issues. The problem is that this is completely legal because when we dealt with section 110 companies - and I quizzed the Minister's predecessor on this at the time - loan originators were carved out from it. We made an exception for loan originator companies. I question whether there are issues of state aid if a foreign bank can come in, lend on, structure it within a section 110 company in Ireland and not pay any tax in respect of the profits it records from its lending activity. I have serious concerns about this. While I heard what the Minister said about the timing of this issue, I believe a report within six months is possible. There may need to be a further assessment afterwards but the Minister needs to start the ball rolling in this regard. I have been raising this since the Government carried out this carve-out two years ago and I am not satisfied with the response the Minister has given. I note he will ask the Revenue Commissioners to investigate these matters, which I welcome, but he needs to go further.

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