Mairead Farrell (Galway West, Sinn Fein) | Oireachtas source

I move amendment No. 16:

In page 94, between lines 33 and 34, to insert the following:

“Report on restricting banks from carrying forward losses

37. The Minister shall, within six months of the passing of this Act, prepare and lay before Dáil Éireann a report on restricting the banks from carrying forward losses against taxable profits in a manner which could result in many institutions paying no corporation tax for the foreseeable future by introducing a 25 per cent cap on profit that can be written off by carried forward losses in any given year and an absolute ten year limit on the use of loss for this purpose.”.

The amendment calls for a report on restricting banks that were bailed out by the taxpayer from carrying forward losses against taxable profits in a manner that results in many of them paying no corporation tax whatsoever, and on the introduction of the 25% cap on profits that can be written off by carried-forward losses in any given year as well as the introduction of a ten-year limit on the use of losses for this purpose. As we enter a new phase of the pandemic, banks are returning to profitability. Indeed, the two largest banks in the sector, AIB and Bank of Ireland, are increasing in scale both with the exit of KBC and Ulster Bank from the market and as a result of recent acquisitions that they have made. Fine Gael amended a law in 2014 to remove the cap to allow bailed out banks to use 100% of the losses they incurred in previous years to be offset against future profits. Up until this change, they could only offset 50% of their prior losses against profits in any given year. We are in a unique situation in having neither a time limit nor a cap on losses that can be carried forward to write off against profits. We are the only country where such restrictions are most justified.

The proposal is that the banks bailed out by the taxpayers should be required to pay corporation tax. All the amendment does is calls for a report to scrutinise this proposal and I hope that he will support this.

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