Paschal Donohoe (Dublin Central, Fine Gael) | Oireachtas source

The special assignee relief programme, SARP, is an income tax incentive aimed at reducing the cost to employers of assigning key individuals in their companies from abroad to take up temporary, short-term positions in the Irish based operations of the employer, with a view to transferring essential skills to Irish based companies. For example, such individuals may be transferred to head up new divisions of the company or take charge of new product development.

In accordance with the Department of Finance tax expenditure guidelines, the SARP is the subject of an independent review which is being carried out by Indecon Economic Consultants. The review exercise affords an opportunity to look at all elements of the relief and also includes consultation with stakeholders. The terms of reference of the review include the continuing relevance of the programme; the performance of the programme in meeting its objectives; its particular features; the annual cost and the overall impact. The appropriateness of the current upper and lower limits on the quantum of income that should benefit from the tax relief is also to be examined, having regard to the objectives of the scheme and the principles of tax equity. The report is being finalised and I expect that it will be submitted to my Department in the next few days. It is my intention to publish the report in the context of the forthcoming budget and Finance Bill.

Our enterprise policy is based on export-led growth, of which foreign direct investment is an important part. Programmes such as the SARP have a role to play in allowing industries to develop in the economy that, in turn, generate the export performance on which we are dependent. However, I am conscious of the broader principle of tax equity. That is one of the reasons I made a change last year in respect of the maximum amount of income that could be claimed under the programme.

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