Simon Harris (Wicklow, Fine Gael)

Those are all very fair points. My first response to the question of why Russia was included until now is that I do not honestly know the answer. I do not want to mislead the Dáil but what I can imagine from my involvement in past postings is that as the sanctions regime evolves and do-not-travel notices are issued, we are constantly looking at both the domestic and European levels for more opportunities to tighten up in terms of sanctions that can have an impact economically on Russia. As I said, based on the latest Revenue data, this scheme did not seem to have any Russian claims in 2023 and, therefore, it probably was not seen as particularly, or in any way, impactful as an economic sanction because it was not truly being utilised in that year. If there is any other relevant data from Revenue, I am happy to share it with the finance committee.

Deputy O'Callaghan asked an interesting question that I, too, asked, which is why the exclusion is only taking effect from 1 January. The answer is that it would be very difficult to implement a retrospective application. Therefore, we consider a prospective amendment in the Finance Bill, applying from 1 January, is the most practical way to give effect to the provision because of potential legal issues considered in implementing it. It is appropriate as well considering the no previous claims for Russia in 2023.

I take the Deputies' points regarding the deduction scheme. I am happy always to keep it under review and it is important that we do so. We published the foreign earnings deduction review on budget day. It found that the policy objective to support Irish businesses seeking to develop exports to new markets remains valid, particularly considering emerging challenges, heightened levels of uncertainty across the global economy and trends towards geoeconomic fragmentation. As colleagues will be aware, the report contained a number of recommendations. We also shared a note with the finance committee relating to any potential concern about misuse of the relief. We reaffirmed to the committee that it is considered that the relief is being availed of appropriately.

I acknowledge the Opposition Deputies who raised this issue on Committee Stage. I acknowledge, too, my constituency colleague Deputy Timmins, who also highlighted it. I welcome this rare moment of unanimity in the House on this matter.

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