Seán Ó Fearghaíl (Kildare South, Ceann Comhairle)
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Amendments Nos.1 and 3 are related and will be discussed together.

Simon Coveney (Cork South Central, Fine Gael)
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I move amendment No. 1:

In page 10, lines 26 and 27, to delete “Minister for Business, Enterprise and Innovation” and substitute “Minister for Enterprise, Trade and Employment”.

This is very unusual legislation. It has 22 parts and has 11 different Government Ministers dealing with the legislation as a whole. I thank Opposition parties, in particular spokespeople, and the Ceann Comhairle for facilitating what is a very unusual approach to legislation albeit the most appropriate approach, given the complexity of the challenges that we face in the context of Brexit and I hope that we can work through this Bill with Ministers coming and going as they must deal with the sections that they are responsible for. That is 11 different Ministers potentially between now and 9.30 p.m. I want to recognise and thank the House for its co-operation.

These two amendments that I am dealing with are very straightforward and completely uncontroversial.

Amendment No. 1 is simply changing the title of the Minister which had been in the previous omnibus legislation from the Minister for Business, Enterprise and Innovation and to substitute the Minister for Enterprise, Trade and Employment.

Amendment No. 3 is doing the same. It is simply deleting "Minister for Justice and Equality" and substituting "Minister for Justice" which again is recognising the current ministerial title. These are two technical amendments and I assume that nobody will have any difficulty with them.

Seán Ó Fearghaíl (Kildare South, Ceann Comhairle)
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Amendments Nos. 2, 17 and 18 are related and will be discussed together.

Helen McEntee (Meath East, Fine Gael)
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I move amendment No. 2:

In page 11, line 13, to delete “18 and 19” and substitute “18, 19 and 20”

This amendment is necessary because of the insertion of a new Part 20 into the Bill which provides for amendments to the Defamation Act 2009. Amendment No. 17 inserts a new single section Part 20 into the Bill, which amends a number of provisions in Schedule 1 of the Defamation Act 2009. The amendments essentially aim to ensure that post-Brexit fair and accurate public interest reporting of certain statements, meetings and press conferences that are held in the UK will continue to be protected against claims of defamation by the defence of qualified privilege in exactly the same way that it exists today. It is making an amendment to include the United Kingdom as part of the structure that currently exists. The amendments arise because several provisions in the 2009 Act regarding the qualified defence applied to reporting of statements and meetings which occur in EU member states. The amendments simply amend these provisions to refer to reports of matters including members of the United Kingdom. It is quite straightforward.

Amendment No. 18 provides for the amendment of the Long Title of the Bill and this is necessary simply because of the insertion of the section of the Bill to provide for the amendment to the Defamation Act.

Brendan Howlin (Wexford, Labour)
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On this grouping of amendments, if the Long Title got any longer it would be a Bill in its own right.

As to the amendment to include the United Kingdom in the current provisions of defamation, is that provision being reciprocated? Will European Union citizens have the same rights in the United Kingdom as the Government is conferring on the United Kingdom citizens here?

Helen McEntee (Meath East, Fine Gael)
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They will, but I will need to confirm that for the Deputy.

Simon Coveney (Cork South Central, Fine Gael)
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I move amendment No. 3:

In page 11, line 14, to delete "Minister for Justice and Equality" and substitute "Minister for Justice".

Seán Ó Fearghaíl (Kildare South, Ceann Comhairle)
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Amendments Nos. 4 and 5 are out of order.

Seán Ó Fearghaíl (Kildare South, Ceann Comhairle)
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Amendment No. 7 is out of order.

Brendan Howlin (Wexford, Labour)
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We had a very general debate on Second Stage. The Minister might remind us exactly of the intent behind section 12.

Seán Ó Fearghaíl (Kildare South, Ceann Comhairle)
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Which Minister is responsible for the Companies Act aspect of section 12? There are no amendments to the section. Could the Minister of State, Deputy English, give us an overview?

Damien English (Meath West, Fine Gael)
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Does this concern Part 4?

Seán Ó Fearghaíl (Kildare South, Ceann Comhairle)
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Section 12.

Simon Coveney (Cork South Central, Fine Gael)
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Section 12 is on the Companies Act.

Seán Ó Fearghaíl (Kildare South, Ceann Comhairle)
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Could Deputy Howlin clarify his question?

Brendan Howlin (Wexford, Labour)
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Regarding the amendment, because of the nature of the Second Stage debate-----

Seán Ó Fearghaíl (Kildare South, Ceann Comhairle)
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There is no amendment.

Brendan Howlin (Wexford, Labour)
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-----we had a general overview without much time to delve into the specifics of every single section. That is what we are about here. For clarity and to have it on the record, I ask the Minister of State to explain the import of the amendment to the Companies Act that is being proposed in section 12. The section states, "Part 17 of the Companies Act 2014 is to be amended by the insertion of the following Chapter after Chapter 7". Could he tell us exactly what the definitions mean?

Seán Ó Fearghaíl (Kildare South, Ceann Comhairle)
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Can the Minister of State help us on that?

Damien English (Meath West, Fine Gael)
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I can. I apologise as I have only just walked into the Chamber for the debate and I believed we were dealing with section 4.

Part 4 of the Bill provides for amendments to the Companies Act 2014 to facilitate the operation of a substitute securities settlement system compatible with the law of the EU after the transition period. The settlement of securities trades, whereby securities are transferred by the seller to the buyer and funds are transferred from the buyer to the seller, is typically made in a securities settlement system operated by central securities depositories, CSDs. The statutory changes are in respect of securities held by a company in a CSD authorised by the EU Central Securities Depositories Regulation 2014. I refer to public companies with shares and other securities using a CSD which are listed on the Irish market. Payment and securities settlement systems are essential to the efficient functioning of all modern economies, which rely, for their continued growth and overall well-being, on the free and open trade of goods and services. This relates to legislation introduced by the Department of Finance, the Migration of Participating Securities Act 2019, which came through the system last year. The changes to the companies legislation are to allow for electronic transfers as opposed to written certificates, which have been used under the UK model. I can go through each section if the Deputy wants.

Brendan Howlin (Wexford, Labour)
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I have two questions. One, what is the relevance of this section to Brexit? Second, what will be the situation after it is passed?

Damien English (Meath West, Fine Gael)
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On the question of relevance, it will come into play in March, perhaps. Until now, the system was operated under the UK's central bank. Owing to the changes because of Brexit, we are moving to a Belgian bank. This was dealt with in legislation by the Department of Finance last year. The UK system was paper based. The changes to companies law are to facilitate electronic transfers in respect of certificates and securities. They are to copper-fasten the electronic system.

Brendan Howlin (Wexford, Labour)
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On insurance, section 46 amends the Act of 1997 by the insertion of "or to a person authorised to transact insurance business by the authority in the United Kingdom charged by law with the duty of supervising such persons" after "5 November 2002". Could the Minister of State at the Department of Finance, Deputy Fleming, explain the import of that section?

Seán Fleming (Laois-Offaly, Fianna Fail)
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The Deputy has asked about section 46. The section allows UK insurance companies without a presence in the State to obtain tax approval for contracts under section 785 where they are authorised to transact insurance business by the authority in the UK which is responsible for supervising such undertakings.

This will mean an individual whose pension is administered by a UK insurance company can continue to benefit from tax relief on pension contributions.

Brendan Howlin (Wexford, Labour)
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The Minister is amending the definition in the Act of "proportion of carried interest derived from the relevant investment" by the substitution of "(including the State), or in the United Kingdom, of" for "(including in the State) of". Will he explain the import of that?

Seán Ó Fearghaíl (Kildare South, Ceann Comhairle)
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Which Minister is dealing with this?

Seán Fleming (Laois-Offaly, Fianna Fail)
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Section 59 provides for a reduced rate of capital gains tax on investment gains accruing to fund managers in respect of investment in venture capital funds. This section is amended so that investments made in the UK can be taken into account in the calculation of the amount of relief. It is a capital gains tax measure. We need to provide for gains in the UK to be taken into account in calculating the amount of relief in respect of capital gains tax.

Brendan Howlin (Wexford, Labour)
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Is that reciprocated by the UK authorities for investments in this State? Why are we doing it?

Seán Fleming (Laois-Offaly, Fianna Fail)
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I can give the answer to that in respect of all the sections that have income tax or capital gains tax. We are only changing Irish law. We have no jurisdiction to change English law. It is a good question. Is it being reciprocated on the other side? It may or may not be. That is the answer. If it is not reciprocated on the other side, Irish and English taxpayers will be covered under the normal double taxation agreements that apply between countries in any event. If the UK reciprocates, that is perfect. If it does not, the double taxation agreements in place between Ireland and the UK and many other countries will apply to all of these situations regardless of whether the UK changes the legislation at its end.

Brendan Howlin (Wexford, Labour)
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Am I to understand that capital investment in the United Kingdom would accrue tax benefits here? Is that what the Minister of State is saying?

Seán Fleming (Laois-Offaly, Fianna Fail)
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It would depend on the place of residence of the taxpayer.

Brendan Howlin (Wexford, Labour)
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Would an Irish investor who wants to spend money in the United Kingdom get a tax benefit from that?

Seán Fleming (Laois-Offaly, Fianna Fail)
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Under a double taxation agreement, the gain will only be taxed once on whatever is the higher rate of tax in either jurisdiction. That agreement already exists in any event regardless of Brexit. Let us suppose the tax rate on a particular item in Ireland is 30% and the tax rate in the UK happens to be 35%. Depending on where a person is settling his or her tax affairs and where he or she is resident, if 30% is paid in one country, only the balance must be paid in the other country and vice versa.

Seán Ó Fearghaíl (Kildare South, Ceann Comhairle)
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Amendments Nos. 8 and 12 are related and may be discussed together by agreement.

Seán Fleming (Laois-Offaly, Fianna Fail)
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I move amendment No. 8:

In page 38, between lines 13 and 14, to insert the following: “Amendment of section 2 of Act of 2010

61.Section 2 of the Act of 2010 is amended—

(a) in subsection (1), in the definition of “Community”, by the insertion of “, subject to subsection (4A),” before “has the same meaning”,

(b) in subsection (4), by the insertion of “, subject to subsection (4A),” before “references to Member States”, and

(c) by the insertion of the following subsection after subsection (4):

“(4A) In this Act, each reference to—

(a) Community, and

(b) Member State, shall apply as if the reference included a reference to Northern Ireland, save—

(i) where the reference occurs in a provision specified in Part 1 of Schedule 9, and

(ii) in the case of a provision specified in Part 2 of Schedule 9, in so far as the provision applies to services.”.”.

Amendments Nos. 8 and 12 relate to value added tax. The changes proposed in amendment No. 8 are designed to ensure that our primary legislation on VAT is consistent with the protocol by including Northern Ireland in the definition of member states and the European Union where those references relate to transactions in goods but not with regard to transactions in services. This means the definition of "Member State" and "Community" in a VAT context will differ depending on the nature of the transaction under consideration.

Section 2 is amended to ensure transactions involving Northern Ireland are defined correctly having regard to the Northern Ireland protocol. It inserts a new section 4A which specifies sections of the Act that are included or excluded from the application of the revised meaning of "Member State" and "Community" in the amendments section, depending upon the type of transaction.

Amendment No. 12 inserts a new schedule to the Value-Added Tax Consolidation Act 2010. The amendment to the definitions of "Member State" and "Community" will ensure Northern Ireland will be considered after the transaction period to be within the community and a member state with regard to goods from outside the community and not a member state with regards to services. This correctly reflects the treatment contemplated by the Northern Ireland protocol. As a result, the treatment of taxable transactions involving Northern Ireland is not universal but differs according to the type of supply is at issue and whether it relates to goods or services. Provisions governing goods must deem Northern Ireland to be part of the Community and a member state while provisions relating to services of the same Act must deem Northern Ireland not to be part of the Community or a member state in accordance with the Ireland and Northern Ireland protocol.

Schedule 9 consists of two Parts. Part 1 sets out the provisions in the Act to refer to services and disapplies the definition of "Member State" and "Community" to Northern Ireland. Part 2 deals with the provisions of the Act that reference transactions in both goods and services. This presents a complication as the Northern Ireland protocol requires that Northern Ireland is seen to be within the Community for the purposes of goods but outside the Community for the purposes of services. This is addressed by the section by disapplying the definition of "Member State" and "Community" to Northern Ireland only in respect of services.

Members can see that under the agreement, there is a different treatment relating to goods and services. We include Northern Ireland as part of the "Community" or a "Member State" in respect of one but differently in respect of the other, depending on the nature of the transaction.

Brendan Howlin (Wexford, Labour)
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Can the Minister of State confirm that this is in conformity with the withdrawal agreement negotiated last year?

Seán Fleming (Laois-Offaly, Fianna Fail)
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Absolutely. I can confirm that.

Seán Ó Fearghaíl (Kildare South, Ceann Comhairle)
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Amendments Nos. 9 to 11, inclusive, are related and may be discussed together by agreement.

Denis Naughten (Roscommon-Galway, Independent)
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I move amendment No. 9:

In page 42, to delete lines 12 to 15.

I am joined by my colleagues in the Labour Party, my Independent colleagues and those in Sinn Féin on this issue. This amendment is simple and straightforward. It is to reinstate tax-free shopping that is about to be abolished, especially for visitors to these shores from the United States. This is a valuable sector of trade and business within the overall tourism trade. With the stroke of a pen, the Government is proposing to use a sledgehammer to crack a nut in adopting this vehicle in its amendment to close off this VAT retail export scheme.

The objective behind the amendment is to enable people who visit Ireland from outside the European Union and who are resident outside the European Union to claim VAT back on purchases and bring those purchases back to their country of origin. Historically, the rate has been set at 0% so that people do not pay any VAT whatever.

As we all know, the retail and tourism sectors are on their knees due to the lockdown we have experienced and the restrictions that have been imposed over the past eight months as a result of Covid-19. Next year, not only will they have to deal with the challenge of Covid-19, the knock-on impact, the carry-forward of debt and the lack of cash flow from 2020 into 2021, they will also have to cope with the unique challenges that will be thrown up as a result of Brexit. These challenges are immeasurable at this point.

Effectively, this proposal by Government is turning the screw on the financial viability of quite a number of businesses, many of them along the western seaboard. In my constituency, we have Dubarry of Ireland, based in Ballinasloe, where there are 50 staff. There is a question mark over their jobs as a result of this measure by the Government. Jobs across the midland counties are hard to come by. We have seen the challenges in terms of Bord na Móna. We have a particularly difficult challenge in terms of job retention in the town of Ballinasloe. There are 50 people working for Dubarry and now there is a question mark over some of their jobs as a result of what is proposed.

At present, approximately 50% of the transactions involving US visitors to Ireland are under the threshold of €75. As a result, we are excluding 50% of the purchases by US visitors to this country. No other EU country is increasing its VAT rates as a result of the United Kingdom leaving the Union. In fact, Spain, which has the largest number of UK visitors annually, is reducing its VAT threshold for non-EU visitors from €80 to zero. France, which is closer to the UK than Ireland is and which has a far greater level of frequency of services, is reducing its VAT reclaim threshold from €175 to €100. Spain and France, the two biggest destinations for UK visitors, are reducing their thresholds and, at the same time, we are increasing ours from zero to €75. This will send out a bad message to UK visitors. We want them to come and visit Ireland and yet we are increasing taxes on purchase they make in this jurisdiction while our counterparts in Spain and France are doing the opposite.

The reputational damage that will be done to the Irish tourism sector, particularly in the British market, could take decades to repair. In the interim, it will damage employment prospects across the tourism and retail sectors at a time when they are dealing with the twin financial plagues of Covid-19 and the disruption as a result of Brexit. It is not the time to tinker with these thresholds.

In 2019, people from Great Britain accounted for 35% of all visitors to Ireland and for one fifth of the total expenditure by visitors in this country. Non-EU visitors to Ireland spend more than €3.2 billion annually here. The Taoiseach was questioned on this issue earlier today by my colleague, Deputy Shanahan, who has a particular interest - naturally enough, coming from Waterford - in Waterford Crystal, a company that will be disproportionately affected by this announcement. The Taoiseach said in response to Deputy Shanahan that Revenue has produced an assessment that there needs to be a threshold introduced. I have not seen this assessment. Will the Minister of State indicate where it can be found on the Department's website or on Revenue's website? Has that assessment been published? The Taoiseach went on to say that the Minister for Finance is bringing down the threshold from €175 to €75, which is complete and utter spin. The threshold today is zero and it is going up to €75. The Government was proposing changes that would increase that to €175 and, because my colleagues and I have tabled these amendments, it has backed down to a certain extent. I welcome that it is not €175. However, the threshold, at €75, is still significant. In the context of the Revenue assessment the Taoiseach outlined earlier, what does it say about those two figures, namely, the €175 threshold and the €75 threshold? It seems to me that these figures are just being plucked out of the sky and could easily be brought down to €25, €5 or back to zero. I would really like to know what type of an assessment the Revenue Commissioners have done.

On 5 November, I asked the Minister for Finance the number of reclaims that are made and the value of these. In his reply, the Minister stated that there were no specific or separate reporting requirements so the figures requested were not available. If the figures are not available to me, as a Member of Dáil Éireann, when I ask the Minister for Finance for them, where is the assessment coming from that the Revenue Commissioners have come up with? The Revenue Commissioners will always look at a belt-and-braces approach to any particular loophole. The concern is that if a resident from outside the EU gets relief from VAT, now that the UK will become a third country from 1 January, British visitors here will exploit the system if there is no minimum threshold put in place. In a parliamentary reply, the Minister stated:

If the scheme applies to visitors from Britain post-Brexit and if the UK were to operate a similar scheme for EU visitors, Irish consumers would be able to buy goods VAT free in Britain and visitors from Britain would be able to buy goods VAT free in Ireland. This could give rise to a considerable displacement of consumer purchases ...

However, the Minister went on to state: "The UK has announced its intention to exclude EU visitors from [the] Retail Export Scheme." There is one of the Minister's ifs gone straight away.

The UK is introducing a system that will include EU visitors from the retail export scheme. This means that Irish residents who continue to purchase goods in this country will not be able to exploit any loophole in it. We are increasing our threshold by €75. The same exclusion will apply in France, where the authorities are reducing their threshold by €75. The same rule will apply in Spain in respect of UK visitors. Spain is reducing its threshold by €80. It seems that we are going in the opposite direction to our EU counterparts. The Minister went on to state, "It was always my intention to adopt reciprocal measures in Ireland to the greatest extent possible if the UK adopted such restrictions". We could argue for the proposed measure if it was specific to British residents but that is not the case. The Minister is saying that he wants to introduce a reciprocal arrangement in Ireland with regard to Britain.

If the Minister wants to reciprocate the UK's measures, why are we excluding every other country outside the EU, in particular the traditionally lucrative US market? What is the reason for lumping the US in with this if we are talking about reciprocating the UK's arrangements? This measure does not seem to be specific to the UK.

The Minister stated that the volume of retail export scheme claims likely to arise would present significant scope for abuse. When I asked for the figures via parliamentary questions, none were available. How are the Revenue Commissioners arriving at figures for the scale of abuse? There is no basis for that assertion.

I have drafted my amendment in a particular manner. The Minister's amendment to VAT law introduces a requirement for proof of importation into the UK, and associated proof of payment, where applicable, of relevant UK VAT and duties on those purchases, of goods that qualify for a VAT refund under the scheme. The Minister is introducing two conditions. First, he is increasing the VAT refund threshold for all visitors to Ireland from outside the EU, including those from the US, from €0 to €75. Second, he is introducing a specific provision whereby visitors from the UK must show evidence that they have paid VAT and duties in the UK if they are to claim a rebate in Ireland. We all know that if people had to go through the process of paying duties, levies and VAT in the UK and submitting documentation to reclaim VAT in Ireland, the majority would not do so. This provision alone will curb any potential exploitation of the difference in VAT rates for non-EU visitors if their country of origin is the UK.

There is no need to introduce a new threshold of €75. It sends out the wrong message internationally, including to visitors from the UK. I do not doubt that, be it done blatantly or in an underhand manner, tourism promotion agencies in Spain and France will quietly whisper to tour operators and people who are considering visiting the EU that they should come to Spain, which has a 0% VAT threshold for refunds, or to France, which has reduced its threshold by €75, rather than Ireland, which has increased its threshold in advance of the UK leaving the EU to penalise British visitors. I hope that the Minister will withdraw this aspect of the proposal and accept that the current regime should remain in place. I hope that he will not force a vote on this issue.

Catherine Connolly (Galway West, Independent)
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Deputy Brady is next.

Brendan Howlin (Wexford, Labour)
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I am sorry. I believed I was listed next on this amendment.

Catherine Connolly (Galway West, Independent)
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I beg Deputy Howlin's pardon. I have just come in to replace the Ceann Comhairle. I have a list of names.

Brendan Howlin (Wexford, Labour)
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I am listed next because the amendment is also in my name, followed by Deputy Nash.

Catherine Connolly (Galway West, Independent)
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Okay. I had a list of names. Go ahead. I will revert to Deputy Brady. He is next.

Brendan Howlin (Wexford, Labour)
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This is an issue that Deputy Nash and I raised on Second Stage in some detail and that has been comprehensively argued by Deputy Naughten. I thank the Minister for listening. It is not related to his Department directly, but he has taken on board the trenchant and clear arguments made by Deputies across the House that this need not, and ought not, be done. I argued on Second Stage that if there was a concern about the loss of revenue from British visitors to the Irish jurisdiction being able to claim VAT refunds on purchases in Ireland, it would be more than adequately dealt with in Part 3. Although it has been referenced by Deputy Naughten, I wish to underscore how this is an extraordinarily high hurdle to jump for any UK national to get a VAT refund. That is a simple fact. A traveller whose place of habitual residence is in the UK must provide proof that the goods have been imported into the UK on behalf of the visitor to Ireland and that VAT, duties, customs and excise chargeable under UK law have been paid on the importation of those goods. When leaving the country, the normal VAT refund that would accrue to someone via VAT refund companies would not be applicable to UK travellers. They would have to go home, pay the duty in full and then go through the process of applying for an Irish tax rebate. The bulk of people will not do that. It is an extremely high hurdle and a robust safeguard to prevent any erosion of revenue that might arise from any potential mass influx of tourists to Ireland availing of duty free goods.

The figures have been put on the record. Approximately 20% of the purchases in question are made by UK nationals. My concern relates to the proposition in respect of all foreign nationals to increase the threshold from VAT refunds from €0 to €175. The proposed figure in amendment No. 10 is now €75. While a significant improvement, it still only amounts to 50% of all purchases that have availed of the refund to date. These are not massive purchases. The people in question are going to craft shops and stores selling Irish knitwear. These purchases sustain those shops. Mention has been made of crystal. Waterford Crystal and all crystal products would fall into this category. These are purchases that people make to bring home souvenirs, and 50% of them are under the €75 threshold. The amendment will devastate that market.

My party has been supportive of all Brexit initiatives taken by the Administration. The Tánaiste has gone on record more than once voicing appreciation for the united and co-ordinated approach taken by all parties in the Dáil on this issue. We have not been divisive. We have not sought party political gain. We have not sought to score points. We have stood shoulder to shoulder to make the best of a very bad lot and to make as many mitigations as we can to the undoubted negative impact that Brexit will bring upon us. However, this proposal in the Bill, in particular the middle part of section 64, which reads, "the supply of a traveller’s qualifying goods, where the total value of that supply of goods, including tax, is more than €175," has nothing to do with Brexit.

It affects American, Canadian and Japanese visitors and, it is to be hoped, the growing number of Chinese visitors who will come when we get back to some semblance of normality with travel. They should not be affected one way the other by the fact that the UK is no longer part of the EU, yet they will be affected because clearly somebody in Revenue decided that this was not a good idea.

If the Government wants to amend tax law, it should do so in the finance Bill and argue its case in the finance committee. It should not be buried or sought to be included in a Brexit-related Bill when it has no implications for Brexit. As I said, the issues in terms of protecting revenue are more than adequately addressed in Part 3. Deputy Nash and I have sought a review of it for the very reason articulated by Deputy Naughten, which will no doubt be articulated by others.

Amendment Nos. 9 to 11, inclusive, are being taken together. Amendment No. 11 asks that no later than 12 months after the coming into operation of section 64 the Minister shall review the operation of the amendment effected by the section and lay before each House a report on his or her conclusions. The idea of that is to deal with the very point being made.

Others in the EU see an opportunity in these arrangements and are looking to see how they can capture the UK spend. In a previous debate, I mentioned what happened in Portugal, which is actively setting up new tax-free facilities to capture British spend. Mention has been made of the changes being introduced in Spain and France. We are actively going in the other direction, but so be it. Due to our proximity, perhaps there is a case for that, but that is more than adequately covered in the third part of this section. Let us review it in a year's time so we can determine whether it is needed or whether we need to mirror what is happening in other European countries.

I have heard no argument whatsoever for the increase in the threshold for VAT from €0 to €75. It is an entirely arbitrary figure. The figure was €175 last week and now it is proposed that it be €75. Why not make it €50? All of this has a real and damaging impact on small retailers who are already on their knees. We have been desperately anxious in this House to find mechanisms to assist those retailers in getting back to business. They have been closed down. We do not want to add another millstone around their necks while they are in the middle of trying to recover from the pandemic and are also impacted by the costs associated with Brexit.

I implore Government to address this. Retailers across the country have been in touch with us. The amendment I and others have tabled proposes to delete the increase in the VAT threshold from €0 to €75. It has no part in a Brexit Bill because it is not Brexit-related. Something which affects Japanese, American and Canadian tourists is not Brexit-related. It is simply an overreach by Revenue to try to claw back money that it does not feel should be there in the first place. If it wants to argue that, let it do so in a budgetary statement and through a finance Bill, not in a omnibus Bill that we are facilitating in a special way without pre-legislative scrutiny and which is being fast-tracked through the Houses.

The vast bulk of what is in the Bill is needed. In the spirit that we have approached all of this, I ask the Government to work in harmony in regard to the need to prepare our economy and people for the inevitable harm that Brexit will do and mitigate that to the best of our ability. We do not want, in the middle of all of that, to include a clause that will hammer one very vulnerable sector of our economy, namely, small retail groups and those involved in VAT refunds. Why would we do that when we are desperately anxious to examine what supports we can give to the sector?

As I said, the Minister for Foreign Affairs gave a very ready listening ear on Second Stage. I hope whoever responds to this, whether it is the Minister of State at the Department of Public Expenditure and Reform or the Minister for Foreign Affairs, will ensure that the Government takes another step back so we can be united on every section of the legislation. Let us ensure that the common approach to Brexit that has characterised the past number of years is maintained and we not do something that I am absolutely certain would be harmful to a sector of our economy that is already reeling from enough blows. I appeal to the Minister to accept the amendment tabled by me, Deputy Nash and a number of other Deputies and not press his amendment.

Gerald Nash (Louth, Labour)
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My colleague, Deputies Howlin and Naughten, articulated the case against the Government's proposition extremely well. I support the objective. Deputy Howlin and I spoke at length in our Second Stage contributions about the impact of this particular proposition from the Government, the changes that are planned in the treatment of UK citizens and the intention to increase the threshold. We also discussed the impact it will have on a very important subset of the retail sector that has been crucified as a result of the pandemic and the public health initiatives needed to address all of the associated problems.

It is ironic that the State has spent countless billions of euro supporting a sector that is on its knees as a result of Covid-19 and help it through this unprecedented and difficult time to allow their doors to be kept open but is now, in effect, turning the gun on that sector after all of the efforts made to ensure that sub-sector of retail could remain viable until such time as the threat of the pandemic recedes and it can return to profitability. If we proceed with the Government's proposition, this will have a catastrophic effect on the sector identified by Deputy Howlin.

Those who sell souvenirs and small companies, which are often family run and, in some cases, passed on from one generation to the next, will be no more. That is the truth. I find it curious in the extreme that an attempt has been made to essentially amend our finance or tax legislation in the context of a Brexit Bill. It seems to me that this is some kind of pet project for an official in the Department of Finance or Revenue who has decided that this represents an opportunity to shoehorn in this particular initiative without any real due diligence, as we have identified and referred to, no pre-legislative scrutiny and no impact assessment worth the name. That is a significant injustice to the retailers who will be negatively impacted by this proposition.

I read the tax strategy group papers presented before our consideration of the budget very diligently and could not identify any initiative from Revenue or anybody else that proposed to make the kinds of changes proposed in this Bill, such as increasing the threshold to qualify for the retail export scheme from €0 to €175, as was indicated in the initial Bill when published. The figure in the Minister's amendment is now €75. This is not the place or time to introduce measures like this when the sector is on its knees and needs our support.

It is reckless, ill-conceived and very poorly timed, and no objective basis has been presented for it. Most of us in the House, I hope, believe in evidence-based policymaking. It is difficult to make the case to support a proposition such as this from the Government without any evidence. The evidence from those on ground, however, suggests this will have an extraordinarily negative impact on their businesses and employment levels in the sector, and on sustaining those businesses that are on their knees.

There is an acknowledgement by the Government that the original proposition was, to put it charitably, imperfect, and a concession of sorts was made in seeking to reduce the €175 refund threshold to €75, but that misunderstands the issue and the concerns of the sector. Splitting the difference will not make any difference. It is an entirely pointless, tokenistic concession to give the pretence that there is some movement in the direction of what the sector requires. I ask the Government, in the spirit of the consensus that Deputy Howlin mentioned and the general unanimity we have had in the House in our national approach to the existential challenge of Brexit, to dispose with its proposition, to accept the amendment tabled by Deputy Howlin and others, including me, and to reflect again on the proposal for the treatment of UK citizens in the application of this section. That can be dealt with.

As I said in my Second Stage contribution, if the Government is determined to make such a provision, let us keep it under review and closely examine the impact of the second part of the proposition. I hope we all believe in the notion of evidence-based policymaking. This is poor policy, shoehorned into an inappropriate Bill in a badly timed and ill-conceived way, and I appeal to the Government to drop it and to accept the amendment.

John Brady (Wicklow, Sinn Fein)
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Many of the points I had intended to make have been well-made by other speakers. I want to outline my approach and that of my party to the Brexit omnibus Bill. From the get-go, we endeavoured to work with the Government, put on the green jersey and get the Bill across the line because it was the right thing to do and it was necessary. There needed to be a consensus to show across the water and throughout Europe that Ireland is united on this issue. The Government, however, has overstepped the mark in bringing forward this proposal, which is not Brexit-related. I do not see a strategy for how it would benefit the tourism sector, and indeed, points have been made about how damaging it will be. We have known since 1985 how beneficial the retail export scheme is for non-EU tourists, and particularly in areas outside Dublin, where it is estimated that almost 66% of the spend takes place.

The sector has been effectively wiped out by Covid-19 and is very much on its knees. Unfortunately, the Government's stay-and-spend scheme has been described as a damp squib. Even the Tánaiste has admitted that it has not had the desired effect and that, essentially, it is not fit for purpose. There does not seem to be a coherent overall strategy for trying to help out a sector that is completely on its knees. The initial proposal was to elevate threshold from zero to €175 but, thankfully, someone in government made a decision to bring forward an amendment to reduce that to €75. Clearly, that is not in line with the views of the majority in the House or, more critically, of the sector, which has said this is the wrong decision, not least at this time with everything that is happening because of Covid and the impact it is having. It will just decimate the sector.

Along with others, I appeal to the Government in the spirit of wearing the green jersey and how united people have been. This is the only amendment that Sinn Féin has tabled and it reflects how we see the matter. It was tabled in the names of my colleague, Deputy Munster, and others. Analysis has been carried out by Fáilte Ireland, which estimates that for every €1 million of tourism spend, 27 jobs are supported. It quantified the 2019 spend under the scheme as supporting 1,200 jobs. Given those figures and everything that has been said about the impact that Covid has had on the sector, it is imperative and right that the Minister not move his amendment and allow the subsection to be deleted. If he needs to bring it back, let him bring it back in some other legislation where there is clear rationale for it, and let us debate it at that point. Now is the wrong time to make the provision and the wrong mechanism is being used, and it is blatantly the wrong thing to do.

Ruairi Ó Murchú (Louth, Sinn Fein)
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I am in complete agreement with everything that has been said about the amendment. It was tabled by my colleague, Deputy Munster, who felt strongly, like a number of the other speakers, that now is not the time, under the guise of Brexit legislation, to hammer the tourism industry. As has been noted by many other Deputies, we are going through a brutal pandemic. There have been attempts by the Government, and proposals from the other side of the House, to provide necessary sectoral supports and actions, and tourism is one area where people have been absolutely hammered. It does not make sense, therefore, in any way, shape or form to remove the retail export scheme and the VAT refund, which makes a significant difference to people. People who sell arts and crafts were mentioned earlier, and the scheme also helps other small sales within the tourism sector.

I agree with others that if a consideration needs to be made in respect of this, it should be taken away from Brexit legislation and dealt with separately. It does not make sense at this time to further hammer this sector. I do not need to add to the figures that have been outlined. The €175 limit does not make sense, and nor does the Government amendment to reduce it to €75, which I assume arose due to the number of people who had commented or tabled amendments on the issue. We need a sensible solution to this. As Deputy Brady noted, we need as much consensus as possible on dealing with the problem of Brexit and to remove this impediment to the tourism sector, which is being crippled.

I add my voice to all the others and reiterate that this point is a very important one for Deputy Munster, which is why she tabled the amendment. The Government has a very simple ask in front of it and has just to carry it out. It is as simple as that.

Matt Shanahan (Waterford, Independent)
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I will not go over all the points that other speakers have already made. Brexit remains a very significant challenge for this country. The sounds coming from Europe today do not bode well. This particular provision of the omnibus Bill is a retrograde step in the context of the challenges of Brexit, particularly for my city and county of Waterford and the whole south-east region. We are very exposed to all of the issues arising out of Brexit. The region is an exporter in the agri-food area and it has supply chains that are heavily embedded in the UK. That will give rise to significant difficulties after Brexit in terms of customs and all of that.

The provision under this section of the Bill will, in effect, largely curtail and strangle the cost benefit for foreign travellers of making purchases when they come to Ireland. In my city, for example, Waterford Crystal estimates that 60% of its foreign tourism sales will be affected by Brexit. That is a huge figure for an industry that is already feeling the effects of international competition. The Waterford Treasures Medieval Museum has a significant number of overseas visitors every year who purchase mementos and souvenirs. All of that will be affected by this provision. Waterford city has businesses like Kite Design Studios and a number of jewellery makers which rely on transactions where people are spending €20, €30 or €40. Their business will be significantly impacted.

I cannot understand why this provision is being introduced. I brought it up with the Taoiseach this morning and asked about the direction and thinking behind it. Has the Government met with people in industry to look at other ways of achieving the security we need? I understand the Government view is that there is a likelihood of abuse if a threshold is not put in place. The initial limit of €175 was very strong but the new threshold of €75 will have much the same effect. We need to do something about this. I implore the Government to speak to industry leads in the retail sector to see what other provisions might be made. There must be an ability to implement additional measures that will address the risk of tourists abusing the situation. The message must go out that we need to support indigenous business, particularly in the craft, tourism and hospitality sectors. This provision is a retrograde step and I join previous speakers in asking the Government to rethink it and find a different solution. The current proposal is not a solution but a grave error.

Seán Crowe (Dublin South West, Sinn Fein)
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As other speakers have pointed out, this section is out of synch with the rest of the Bill. I read the explanatory memorandum to the Bill and it states that the threshold for third-country residents to qualify for the scheme is €175. That has not been updated. We need an explanation of where the Government is coming from with this provision. As colleagues have noted, the retail sector is on its knees. Instead of discouraging people from spending, we should be encouraging them to spend more. We are facing into uncertain times with Brexit and, as such, we should be trying to encourage more people to travel to Ireland in a safe manner post Covid. This provision will discourage people from spending when they get here. Instead, we should be encouraging every tourist who comes to Ireland, particularly next year, to spend more.

I do not understand the logic and thinking behind the section. I join previous speakers in asking the Minister of State to think again. The section does not add to the Bill but takes way from it. A large number of Opposition Members have called on the Minister of State to reconsider what is proposed. Even at this late hour, I ask him to go back to his officials and look at it again. Reference was made to the fear that there could be widespread abuse of the scheme. There is nothing stopping us from introducing legislation to address that. At this stage, looking to next year and the difficulties the sector is going to face, common sense would suggest that the Minister of State should withdraw this provision.

Seán Fleming (Laois-Offaly, Fianna Fail)
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Amendment No. 9 seeks to delete the section of the Bill that provides for a threshold for the retail export scheme. As referenced by Deputy Seán Crowe, the explanatory memorandum to the Bill refers to the original provision that the value of qualifying goods must exceed €175 in order for third-country residents to qualify for the scheme. It also requires UK citizens to show proof that VAT and customs and excise duties have been paid. These measures do not eliminate the use of the VAT retail export scheme for UK residents post Brexit. Instead, by excluding goods below a certain value threshold and requiring proof of declaration of import into the UK for any goods for which a refund is claimed by a UK-based traveller, they provide the legal basis to protect Exchequer revenues and control and minimise the scope of abuse of the scheme. This is necessary given Ireland's proximity to the UK and the volume of traffic between the two countries. Therefore, unfortunately, the Government cannot accept this particular amendment.

However, our amendment No 10 proposes that the limit of €175, as set out in the Bill as published, be reduced to €75. This is done in recognition of the challenges facing the retail sector and to support the sector in these challenging times. It will apply to all third-country travellers who are seeking the refund. This change was influenced to no small extent by the views put forward strongly by Deputies on Second Stage that the figure of €175 was very high and a new limit needed to be introduced. The Minister took on board everything that was said during the debate, both inside the House and outside it. In recognition of the challenges facing the retail sector, he is introducing this amendment to set the threshold at €75, which is a substantial reduction from the original figure. This is the result of the Minister paying close attention to everything that was said by Deputies in the debate to date and taking careful consideration of it.

Amendment No. 11 calls for a report on the operation of the provisions of the section within 12 months of their coming into operation. A lot of people have argued that we should wait to see whether there is abuse rather than anticipating it. We are concerned that there is a risk of abuse and, as such, we are taking a prudent approach by introducing the €75 limit. Deputies Howlin and Nash are making the case, in this amendment, that we should see how the scheme is working and review it after 12 months. I will clarify our position in that regard in a moment.

I wish to make a few points about the operation of the scheme. As I said, it will not prevent visitors from the UK from making purchases here. To put a fair picture on it, the other side of the equation is that the UK has publicly announced that it will not operate the retail export scheme for any traveller from 1 January 2021. This means that Irish travellers to Britain will not be able to reclaim the VAT they pay on purchases in the same way that British travellers can in respect of goods purchased in Ireland. The UK has moved unilaterally to cease operating the scheme, which means Irish people travelling there will not be able to get the benefit of reclaiming the VAT, but people coming here from the UK will be able to do so. We have been more generous on this issue than the UK, which is dropping it completely.

We have mentioned the possible abuse of the scheme. Owing to the close proximity of the UK, the number of transactions involved and the amount of traffic between Ireland and the UK, this is one area we have to look at. By excluding goods with a value of less than €75 from the scheme and requiring proof of declaration of import into the UK for any goods for which a refund is claimed by a UK traveller, the proposed measures will ensure that we avoid any double non-taxation. It is important that we protect the Exchequer. We have heard of double taxation but there is a real possibility of double non-taxation in this situation. If people can claim the VAT back when they return to the UK, they will got the VAT back from the Irish side. Arrangements in the UK, which are separate and already in place, provide that proof of payment of VAT in the UK will apply where the value of the goods exceeds the UK's personal allowances. Proof will only be required for goods valued at more than €440. Already, there is a threshold in the UK at which one does not have to produce any proof of payment of the VAT. People could travel from the UK and claim the VAT back under the Irish scheme before returning to the UK where they are resident and obtain a VAT refund without having to prove that they paid VAT. Unless this measure is in place, they would be able to get a refund in both countries. There is a real risk of both countries losing out and non-taxation occurring in both jurisdictions. That is an issue we would have to look at.

Thresholds in other countries were mentioned. There are significant thresholds in other countries, some of which have been cited. For example, the threshold in France is much higher than the threshold here.

Much of the discussion has centred on the practicalities of supporting and encouraging businesses. The scheme is an opportunity for retailers to increase their business and sales to foreign visitors when they come to Ireland. There is a real opportunity for them to do that, as anyone who follows the logic by which people spend money will understand that. For example, in many of the main supermarkets, people get a tenner off if they spend €50, provided they have a €10 voucher. That is a big incentive. If someone feels like spending €35 in a supermarket, it will cost €35 to do so, whereas anyone who spends €50 will get a tenner off and the cost will be only €40. In the Irish psyche, and in the psyche of all travellers and tourists, an offer of getting something back for buying in a certain shop is an incentive to go to that shop.

If we take the system as it works now, somebody who spends €40 on a souvenir can get approximately a quarter of that cost back. Let us say €8 or €9 can be reclaimed in VAT when a company processes the VAT. The company that processes it takes 50% or thereabouts for processing the VAT, so the person will be lucky to get €4 or €5 out of that, which is very little. That is not a major incentive. I will put it this way. Irish retailers have a keen sense of business and of their customers. If a customer comes into a shop and says he or she wants to buy a souvenir and it is €50, it costs the customer €50 under this scheme and he or she will not get any VAT back. If the customer spends €60, it will cost €60. However, if I was a clever retailer - Deputies spoke about craft shops run by families for more than one generation - and I had somebody coming into my shop to buy something for €60, I would tell the customer that if he or she spent over €75, he or she would get €18 back. It would actually only cost the person €57. This is a great incentive for tourists who are spending €50 or €60 to spend €75 because it will actually cost them less than €60 once they get their VAT rebate. It is a bit like the person going into the supermarket. Every Irish person understands that a voucher gets us a tenner off if we spend €50. Who is going to spend €48 if spending an extra €2 will get us a tenner back? There is a great incentive here. This is the exact same principle that I keep saying Irish people and tourists understand. If we encourage people to spend €75, they will get approximately €18 back in a VAT rebate. That is a great incentive to spend €75 they might not have spent otherwise.

That point will not be lost on the retailers of Ireland, the souvenir and craft shops and all the companies that have been mentioned. It will encourage people to spend an extra few bob and it will cost them less as they will get VAT back. That will encourage purchases of over €75 and change the current dynamic where people say many of the purchases are below price. It will encourage trade and most of the purchases will be over €75 in the future. That will result in more business and more profit for local business because it will generate additional sales. We want to encourage business.

I accept that was probably not the reason the Revenue proposed this measure but when I saw the proposal in the Department of Finance, I could see a benefit. As a person who regularly uses the voucher that gives €10 off the next €50 purchase in a supermarket, I said that this sounds like a similar scheme. It is sensible because it will encourage people to spend and that will help the tourism trade in all the different areas that have been mentioned.

There has been quite a debate on this and the idea of trying to achieve consensus and a general approach to this matter is much appreciated and accepted. There has been goodwill and support to ensure this legislation is passed "unanimously", if that is the right word, by the House without calling a vote. We are listening carefully. I am very much taken by the amendment by Deputies Howlin and Nash. It proposes to insert the following:

"Review of operation of section 64

65.No later than 12 months after the coming into operation of section 64, the Minister shall—

(a) review the operation of the amendments effected by that section, and

(b) lay before each House of the Oireachtas a report of his or her conclusions from the review.".

That is a sensible compromise. Having listened to the debate, I encourage Members to accept the State's view that there is a legitimate possibility of people paying tax in neither jurisdiction and both sides losing out, and to recognise that we have a system in place to allow UK travellers in Ireland get VAT back on purchases over €75 notwithstanding that it is not reciprocated. We cannot get anything back there. We are being generous on that basis by allowing the scheme to continue, which is not part of the arrangements in the UK based on public statements today.

Deputies asked whether there was evidence. As the UK is directly involved in this legislation and was cited in the original section 64, it is necessary to have a specific provision in this legislation for UK travellers. The point has been well made that it catches travellers from outside the UK and the EU, such as visitors from America or China. That may be the case but it would make the operation of the scheme more complex to have different rules for people outside the EU, one rule for the UK and maybe a different rule for Chinese or American visitors. I accept that this aspect may need to be examined further in the light of experience that we gather during the 12 months of operation of the scheme but it is only fair at this stage to take the prudent course and introduce the measure. Amendment No. 11 provides for a review of the scheme. On that basis, on behalf of the Government, I will be happy to accept amendment No. 11 as a fair and sensible approach to reviewing the operation of the scheme after 12 months.

Another point made is that some of these provisions could have been included in the Finance Bill. It is more germane to this legislation because it deals with the UK. There is a sentence in the provision that is not specific to the UK but we are trying to introduce a level of consistency in the changes we were making. We included a particular sentence to make this consistent for all countries outside of the EU. I hope Deputies will accept our bona fides on that.

I accept the good case being made that we need to review the scheme and see how it works out. Instead of voting down the provision, let us give this threshold of €75 a chance.

I expect Fáilte Ireland will be very strong in promoting the fact that visitors who spend €75 or more will be able to get VAT back. That will encourage people to spend while they are here and retailers will encourage their customers to spend more when they get them into the shop. I am sure lots of shops will take great advantage of the scheme, which is the equivalent of a voucher in that people get 23% back if they spend over €75.

I would like to see how this scheme will work out in the course of a year. On that basis, the Government amendment on reducing the figure from €175 to €75 needs to kept in this legislation because part of the relevant section is UK-specific. However, I also accept the point made in respect of amendment No. 11 that a review be carried out after 12 months. That is a very fair consideration in the circumstances. I hope the House will agree to accept the Government amendment alongside amendment No. 11 to ensure there is a 12-month review. To be clear, I am not giving a commitment that the amendment will be written into the legislation when we conclude business this evening because we are disposing of all Stages tonight. We will not have an opportunity to come back to this on Report Stage next week as we will complete Committee, Report and Final Stages. It is not an issue we can tease out in the coming days. I hope Members will accept the Government's bona fides in agreeing to amendment No. 11, which is a fair amendment.

Brendan Howlin (Wexford, Labour)
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I will begin on a positive note by thanking the Minister of State for accepting amendment No. 11. The very least we can do is review the operation of the three proposals in this section after a year and I welcome that. I also admire the Minister of State's mental dexterity in being able to argue that introducing a new high threshold will be welcomed by retailers. By that logic, if we raise the threshold to €500, they will be ecstatic because people would flock in to spend €501. The Minister of State missed his calling; he should obviously have been in public relations. I spent five years in the Department of Public Expenditure and Reform but this concept of double non-taxation the Minister of State has introduced today is certainly a new one. If the UK tax authorities were so decent as to subsidise Irish retailers, I would be delighted. If we get a VAT refund for sales in Ireland and the UK tax authorities outside the European Union decide to give a tax rebate there as well, would that not be a great thing? It would be a real boon to retailers and purchasers and would encourage people to spend in Ireland at the British taxpayer's expense. Why in God's name would the Minister of State regard that as a bad thing? I do not see any merit in that argument whatever.

The basic contention is very clear here and Deputies on the Opposition benches who have made this argument have been clear. If there is a real threat to revenue from UK nationals becoming third-country nationals and spending and getting VAT rebates for their purchases in Ireland, I do not see that there will be any great loss from that because they are spending money in Ireland. However, if the Minister of State thinks there will be a loss, let us see how that impacts. There is not going to be mass tourism in the next 12 months, as the Minister of State knows. It will be well into next year before we have mass vaccination and even after that, many people will be reluctant to travel. There will be no mass tourism in 2021 so the very businesses we are talking about here - craft and souvenir shops, knitwear shops and the small jewellery shops - will all be clinging on for survival in any event Why in God's name would we impose another burden on them now?

The Minister of State has taken the first step by indicating the Government will review all of this in 12 months. None of us is seeking to amend the third part of this, the high hurdles that have been put in for UK nationals. Very few people will jump those particular hurdles to get their money back if they have to pay up front, return to the UK, prove they have paid duties and taxes in the United Kingdom and then apply to Ireland for the rebate. How many people will do that? I do not think there will be any discernible impact on revenue from that so that is closing off the fear. However, the extra yard the Minister of State is insisting that we go now is to deal with people who are not affected by Brexit, good, bad or indifferent, namely, tourists from the United States, Canada, Australia, China, Japan or any other third country who now enjoy the possibility of getting excise returned on expenditure from a zero threshold. The Minister of State wants to raise that threshold to €75. That has nothing to do with Brexit. It will impact on retailers and we have been told as much. The independent economic evaluation the retailers have done shows that the Minister of State's proposed new threshold of €75 will impact on 50% of their sales. It is not too late. If the Minister of State cannot make a change now and if he needs to discuss it further with the Minister for Finance, Deputy Donohoe, will he give us an undertaking that he will consider the matter overnight? I understand we will deal with Report Stage tomorrow. Is that not correct? We could deal with that amendment overnight if the Minister of State cannot deal with it now. However, in a very comprehensive and elaborate Bill that has brought consensus, why would the Minister of State introduce a note of discord and cause the House to divide, which he will do if he does not go this last step?

Catherine Connolly (Galway West, Independent)
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I advise the Deputy that the House will have disposed of the Bill if we get through it tonight.

Brendan Howlin (Wexford, Labour)
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I just looked at the schedule. Is there no possibility of-----

Catherine Connolly (Galway West, Independent)
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There is a possibility but if we get through it all tonight-----

Brendan Howlin (Wexford, Labour)
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The Leas-Cheann Comhairle should not encourage us.

Catherine Connolly (Galway West, Independent)
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I am just clarifying the position for the Deputy.

Gerald Nash (Louth, Labour)
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We have offered all evening to allow the Minister of State to engage with the Minister for Finance, Deputy Donohoe, and his officials to discuss Deputy Howlin's proposal, which is a reasonable one. The Minister of State has gone so far as to at least understand the concerns we have expressed on behalf of those who will be so adversely affected by this change he appears determined to introduce. Like Deputy Howlin, I am stunned by the Minister of State's logic and his particular understanding of consumer behaviour. Whenever our political careers end, hopefully not any time soon, we might consider going into business together because the Minister of State's understanding of consumer behaviour would lead to considerable profitability for any business he might get involved in.

I ask the Minister of State to examine our proposal again. He has gone this far and there has been a concession by the Department of Finance and the Revenue in understanding the logic of where we are coming from and the concerns of retailers by reducing the threshold from €175 to €75. We are nearly there and the Minister of State should consider this a little more.

As Deputy Howlin said, the third element of this provides for some onerous obligations on UK citizens who purchase goods here. They will go through an onerous process, including proving purchase, reclaiming VAT, and so on. As I said on Second Stage, from looking at the evidence provided to us by the retail sector and speaking to those who are directly involved, I believe the Minister of State's view of the potential impact on the UK and the potential for lost revenue is exaggerated. We are also not looking at the potential, if we leave things as they are, for increased activity, revenue generation and employment taxes. That is something we need to consider and there needs to be a trade-off in that regard.

I want to correct part of the contribution I made earlier. I reflected and there was reference to this issue in the tax strategy group papers. This leads me to be even more surprised than I was that no reference was made to this proposal in the budget speech of the Minister, Deputy Donohoe, in mid-October, no reference was made in the Finance Bill, and no reference was made in any engagement at the finance committee in recent weeks on Committee Stage of the Bill. That is surprising. This is no place to discuss this proposal, which will have a wide-ranging impact on our taxation system and the treatment of a retail sector in this country that has been disproportionately impacted.

We need to do everything we can to make sure these businesses can keep their doors open. They have been benefiting from the temporary wage subsidy scheme, the employment wage subsidy scheme and, in recent times, the Covid restrictions support scheme and other supports provided through our local enterprise office network. It would show a wilful disregard to them if we were now to turn around and place an additional burden on their shoulders. They are looking to 2021 with some hope that they can keep the door open, thanks to the supports provided by the Members of these Houses. They are looking at 2021 with a bit more optimism, as we hope we can have a vaccination programme that will keep people safe and get our economy back to some form of normality. They are now struggling for viability. They can be viable, and let us support them to profitability next year by parking this proposal in full. I implore the Minister of State to reflect on this again. Let us engage over the next short period with the Minister for Finance to reflect on the impact this will have on those who will be affected by it and do the right thing by them.

I acknowledge the efforts of the Minister of State to reach a form of consensus with Deputy Howlin and myself on a review. There would be no need for a review if we had the entire evidence base the Minister of State says is available to him, which guided this particular policy proposition in the first place. In the absence of all this, we simply cannot support the proposal he has made because of the damage we know it will do. Of course, a review would be useful and it is good policy practice but we do not want to see this occur in the first place. Our amendments are designed to protect the sector and those businesses, and ensure the more than 1,000 jobs that may go as a result of this intervention are protected and that those livelihoods are protected.

Denis Naughten (Roscommon-Galway, Independent)
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I have set out my position on this. I do not want to see the House divided. From his response to us earlier, the Minister of State is willing to engage in compromise. If he is willing to compromise and take on board Deputy Howlin's suggestion, there is a mechanism whereby he could bring forward an amendment in the Seanad and we could deal with that amendment next week through amendments from the Seanad. The vehicle is there for the Minister of State if he is willing to do that and if he is prepared to indicate along those lines.

Seán Crowe (Dublin South West, Sinn Fein)
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I am one of those unfortunates who likes a bargain. I listened to the speech of the Minister of State and I must write a note to myself not to shop in his store in future. I do not think there was anything he outlined to us that would change our minds on this. We are all starting from the position that we believe the sector is on its knees and this will introduce a new element that will make it even more difficult for people to recover. I listened to the Minister of State speak about the Labour Party proposal and his compromise that he would review it after 12 months. I would welcome this but it does not necessarily need to be in the Bill. He could articulate to us today that he will review it after 12 months. It is the sensible thing to do. I still think it is more sensible not to introduce this section and the €75.

There are different types of tourists who come to Ireland. Some have bigger pockets than others. I do not think the argument about some of the stores where people spend €50 and get €10 back encourages more spending. If it did, the Minister for Finance would look at alcohol sales and there would probably be changes in that regard. I accept the Minister of State probably cannot make this decision now. Other speakers have referred to the fact the Minister for Finance was in the room during the debate. The Minister of State needs to consult the Minister and if there is a mechanism whereby he can come back to us, such as an amendment somewhere else, perhaps we could look at it. It is wrong, from the starting point of baldly looking at this issue as that it will do more harm than anything.

I also listened to what the Minister of State said about the British not having a reciprocal measure. Again, with regard to what the Brits do and what we do, we need to look at what is good for the Irish people and the Irish economy. We know that Brexit is not good for the economy. We know that the road the British Government is bringing its people down is the wrong road. There are people throughout Europe, and probably throughout the world, who would accept the premise that what the Brits are doing is madness but they are intent on it. They had a referendum and they believe it is the right thing for them to do. We have a contrary view.

We need to look at what is good for Ireland and clearly this is not good for Ireland with regard to those visitors whom we hope will return to our shores. I agree with Deputy Howlin's statement that there will not be massive tourism. Certainly all of us want to go back into the sun and holiday mode. One of my colleague spoke about the staycation. It did not really work, particularly for people in Dublin because we were in more lockdowns than other parts of the country and many people who bought those staycation breaks did not get the opportunity to use them. I hope they will get to use them early next year or when the current lockdown is lifted.

I appeal to the Minister of State to put on his thinking cap. He is clearly thinking about how good this will be for the taxpayer and businesses. We have a contrary view. We do not think it is good, particularly for those businesses that have been hammered, as Deputy Nash said. They are on their knees. It is an element being introduced that will do serious harm to the sector. It is something it could do without. It is an additional headache for the sector. With regard to the argument on having a different arrangement for other countries, and the Minister of State mentioned the US and China, there is nothing stopping any legislation having something about Britain. If he is worried about getting new legislation through the House, we know from our experience that if we set our minds to it we can introduce legislation within 24 hours if it was felt necessary. I have been one of those people who has sat up half the night to get legislation through the House. That is not an argument.

The Minister is introducing an unknown. My instinct is that this will harm the sector, which is what my colleagues and others in the Opposition are saying. I appeal to the Minister for Foreign Affairs to immediately get in touch with the Minister for Finance, and to think again and revisit this particular element. If he cannot make that decision, he could park this while we go through the other parts of the legislation. If the Leas-Cheann Comhairle thinks that is possible, we could deal with the other sections and then come back to this later in the evening. The Minister needs to think again and to change his approach in this regard.

Cian O'Callaghan (Dublin Bay North, Social Democrats)
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I support the contributions made by other Opposition Deputies. It is to our credit, as a country, that our approach in general on Brexit has been quite united and quite agreed, which contrasts sharply with what is happening across the water. It is a shame there is not agreement between the Opposition and the Government on this. The prudent approach would be to take this out of the Bill. The issue can always be revisited at a later date or on a later Stage, if necessary. However, given the pressures the sector is under, it goes beyond belief that we could introduce a measure that will create further stress, worry and anxiety for people in the sector. I ask the Minister to look at this again and to consider withdrawing it.

Ruairi Ó Murchú (Louth, Sinn Fein)
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Once again, it has all been said. The Minister is halfway there in regard to accepting it is a good idea to have a review. Nobody is absolutely clear, including himself, in regard to the outworkings of this. Our belief is still that it could be detrimental to the tourism industry that has been absolutely hammered up to this point. If there is some mechanism whereby this is not dealt with now and is postponed so it can be reviewed and dealt with somewhere else, I believe that is the right thing to do. That would allow us to largely deal with the Brexit omnibus legislation on a consensus basis. It is as simple as that. If the Minister can find some sort of solution that takes this off the agenda, even if it is to be reviewed and dealt with quickly within the next days or couple of weeks, that would be preferable. The Ministers for Foreign Affairs and Finance have the powers and the levers to do this, so I will leave it to them.

John Brady (Wicklow, Sinn Fein)
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I reiterate the appeal to the Minister. He presents himself as a Minister willing to compromise and to take on board some of what the Opposition is saying. The amendment he brought forward to reduce the sum to €75 from the initial proposal of €175 was presented as a compromise, when it is not a compromise because it does the same thing: it damages a sector that is completely on its knees. When I say “on its knees”, I picture the stores in rural parts of Connemara and the western seaboard that are open purely for the tourism industry and that sell themselves as tax-free shopping ventures. They now have to make very difficult decisions while the shutters are down, because activity in the sector is non-existent. They have to make decisions now as to how they can feasibly reopen in light of this amendment, which can only be described as a way of penalising them. It will be perceived as penalising foreign tourism, particularly in those areas. We know 66% of the money spent is spent outside Dublin and particularly in those areas.

If the Minister truly sees himself as willing to make compromises, I reiterate the appeal at this point to withdraw the amendment. It will come up in the Seanad next week, when he can bring forward an amendment and listen to what is a united voice across the Opposition in this regard. Let us have a united voice on Brexit and on the omnibus Bill. We do not want to push these amendments. As I said in my opening contribution, it is the only amendment that any of my colleagues in Sinn Féin has opposed because we do not see it as part of the fit in terms of Brexit. The Minister has overstepped the mark. He has an opportunity to rectify that and withdraw the amendment to help save a sector that is very much on its knees, and to do the right thing. I reiterate that appeal.

Éamon Ó Cuív (Galway West, Fianna Fail)
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As the Minister knows, I raised this issue with him some time ago. I have been concerned about it because it will have a devastating effect on businesses along the west coast. When I look at Connemara and the number of families who depend on craft shops to make their livelihoods over a few months, I see the disaster that this year has been because, even when it opened up, the kind of stock held by the shops was not really for Irish tourists and much of it had been bought for non-Irish tourists.

I have expressed time and again my dissatisfaction with Bills coming into the House, in particular very important Bills, where we are up against the wall for time. I believe we often spend too much time before we bring Bills to the House and way too little time when the Bills are in the House, when we are actually dealing with the meat of the Bills, with the details, with what will go into law and what will stand. The idea of having Committee Stage and then having Report Stage where Members cannot resubmit amendments from Committee Stage to Report Stage is wrong in principle, unless it is emergency legislation that could not have been foreseen.

Brexit has been foreseen for a long time. As I said when I spoke on Second Stage, many people in Europe and in Ireland went into denial about the British decision, instead of saying that they have had their referendum and made their decision, that we accept the democratic right of the people of Britain to make that decision, and that now we must prepare. I cannot understand how it has happened that this Bill has come into the Dáil with so little time for discussion and no time to do the thing I think we all learn in the seat the Minister is in, that is, it is a good idea when something comes up on Committee Stage, when the Minister sees the validity of an argument, to say he will reflect on that and come back on Report Stage.

That is not practical because of the configuration in the Dáil with regard to the time that has been set for this Bill. A practical suggestion was made that an undertaking would be given to look to introduce an amendment to deal with the issue between now and the Seanad debate. It is fair to say Department of Finance of officials will always take the negative side of everything. For a lot of things in this country, if the Government had willy-nilly accepted Department of Finance proposals, we would not have had very brave and innovative things that were thought up over the years that went against the dead hand of advice, but are now lauded as great ideas. I cannot see why it would not be possible to reflect on this issue and to take the time before the Bill goes to the Seanad to listen and cogitate on the validity of the arguments.

In a previous Dáil, as I am sure the Leas-Cheann Comhairle will recall, we dealt with the Gaeltacht Bill 2012 and, again, it was scheduled under the same system.

It should not have been rushed. There was no emergency about it. It was foreseen but, for some reason of scheduling, it was decided to proceed with Committee and Report Stages in one sitting. I am proud to say that I organised a walk-out in total of the Dáil that day. Some Deputies, I suspect, did not really know the reason they were walking out. We were walking out not because of the manner of the Bill but the principle of taking all Stages in one session and not allowing engagement on Committee and Report Stages.

I know it is unusual for somebody in a Government party to speak in these terms but for years I have felt passionately about the time towards the end of the session when issues that were foreseen for years suddenly become rushed and the most important function we have as elected representatives gets put aside. Governments say they would like to take suggestions on board and Ministers sit in their seat and say they wished they had more time to consider an issue but they cannot because they have been told that it has to be passed by the House in whatever time. I hope that the Minister of State will give a commitment to reflect on that and if it cannot be done in the Dáil because of the rather bizarre arrangements in terms of this Bill, it could be done between the Dáil and the Seanad. As the Minister of State knows, if an amendment to the Government amendment was passed by the Seanad, it would take five minutes for it to get through the Dáil. In fact, it could be done on the same day the Seanad passed it. That is not an excuse. We have got many sitting days until the end of the year to get this right but to rush into it and get it wrong could do a great deal of damage to people who are already on their knees and suffering terribly after this disastrous year. We know already that next year will not be a good year for tourism and it is fair to say that 2022 might not be a good year either. As a result, hitting tourism with a double whammy at this time is not a good idea.

Seán Fleming (Laois-Offaly, Fianna Fail)
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We have had a discussion on this topic for the past couple of hours. It is very important that all of the views would be discussed but this is one issue on which we have not arrived at a consensus. The Bill before us contains approximately 120 sections and 50% of them relate to the Department of Finance. The entire essence of everything we have done relates to various arrangements between Ireland and Northern Ireland as a result of the protocol and between Ireland and the UK, which is no longer a member state of the European Union, and different rules and regulations regarding VAT for services and goods to and from Northern Ireland.

We have had many Brexit-specific debates. The essence of this section is to make a change in respect of the United Kingdom regarding the particular scheme before us today. As I said, the original proposal was €175. As a result of the Second Stage debate and the comments of everybody during that debate, both inside and outside the House, it was agreed to reduce it to €75. Having listened to the debate we agreed that this matter needed to be examined in further detail. I indicated on behalf of the Government that we would accept the amendment from Deputies Brendan Howlin and Nash on the 12-month review of the operation of the amendments and that that would come back before the Oireachtas in 12 months' time once the legislation is enacted. We felt that was a fair and reasonable move to accommodate a proper analysis of what might happen when the scheme is actually up and running.

We also felt it was necessary that we need this in respect of the UK because, as I mentioned earlier, the volume of traffic between Ireland and the UK is very high because of the close proximity. The number of transactions that would be involved is very high because of the proximity and the number of people who travel between Ireland and the rest of the UK. As a result of the arrangements the UK has for claiming back VAT - they do not have to prove payment up to a figure of €440 - the very likely scenario is that if we do not make the change in respect of the UK in this legislation people will get the VAT back here as well as in the UK. To use a phrase that I am told was one of the first times it was used, it would result in double non-taxation. We do not want a side effect of this legislation to allow a situation where there is double non-taxation in terms of people getting VAT back twice on the same transaction. I do not believe anybody would think that is a good idea.

Britain has made its decision to withdraw from the EU. That is its right and we will respect that when it happens but I do not believe anybody would agree that there should be a double non-taxation or a practicality in many cases that no VAT at all would be paid anywhere on these transactions. Not only would someone get the VAT back once but they would get it back a second time possibly in the UK also. I do not think people have considered what would happen if we do not have this particular section in the legislation. If there is a scheme to allow people get VAT back, that is fine. There should not, however, be an opportunity for a person, on foot of Brexit, to claim VAT back twice on the same transaction and make a financial gain as a result of us not dealing with this issue. It is incumbent on us to deal with this issue in order to ensure that there are not double VAT reclaims or double non-taxation. Nobody would support a regime that was designed to facilitate double VAT reclaims on the one transaction in two different jurisdictions. That is the reason that is in the legislation.

The other suggestion made was that part of the legislation as drafted will affect people in other countries, whether it is the United States, China or whatever the place of origin of tourists coming to Ireland. It has been suggested here in the past hour or so that we should make different arrangements for the other countries and do for them what we are doing in regard to the UK and that we could have a different situation but Ireland has decided to be a fully fledged member of the EU. Britain has decided the opposite. When a country is a member of the EU we are obliged to follow all the EU VAT directives and those directives do not allow for separate thresholds for different countries. We cannot have one arrangement in respect of VAT on a transaction here with England, which will be a third country, and a different arrangement for a tourist who comes here from the United States. That would almost be a tariff on one or the other tourist depending on their country of origin and EU legislation and the VAT directives do not allow that. The Minister is being asked to make a change to that to exclude the other countries from this legislation but to do so would be in complete breach of EU directives on VAT. Ireland has always supported the common agreements we have in respect of VAT and we cannot unilaterally change VAT arrangements for different people visiting the EU depending on their country of origin. I hope people understand that we cannot separate that particular sentence in the original section of the Bill from the rest of the section, which is necessary to deal with the UK's decision to withdraw from the EU.

What we have said so far is that this came in at €175.

People have asked to meet somewhere in the middle. The Government has more than done that. We have come down 60% of the way from €175 to €75. We did not just halve it.

We have come a long way in, unusually, accepting an amendment from the Opposition to include a report. Normally at this point, a Minister would commit to produce a report within 12 months, but we are going a step further than would normally be the case and we are agreeing to amend the legislation to include the report. That is not normal but we are going that extra step. This legislation may not be completed tomorrow or it could be completed this evening. I do not know if there is any procedure to skip this section and move on. I doubt if there is and I would not like to ask to establish a precedent on that if it is not normal. Another point that was raised was that it can perhaps be looked at in the Seanad. That is still a possibility. I am not in a position to say that the Government will table an amendment in the Seanad but I think that everybody knows the reality, that if people feel it is definitely necessary, it is possible. Considering that we have moved from €175 to €75 and stitched a commitment for a 12-month review into the legislation, I have gone as far as I feel I can on behalf of the Government.

I am in a position to accept amendment No. 11 in Deputy Howlin's name, amendment No. 10 is from the Government, but I am not in a position to accept amendment No. 9 from the Opposition. There may be opportunities for the matter to be looked at again in the Seanad, to reiterate what other Members have said, but I am not in a position to give a commitment that the Government will table an amendment. I have gone as far as I can.

Seán Ó Fearghaíl (Kildare South, Ceann Comhairle)
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We will not set aside the amendment. We have to deal with it.

Denis Naughten (Roscommon-Galway, Independent)
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I will not rise to the Minister of State's bait but I want to correct the record, because I would not like people to get the wrong end of the stick. We accept that the Minister of State has gone as far as he is going and that is his prerogative. Let me make it clear that the threshold is being increased by 7,500%. The Minister of State should not try to twist it around to say that it was at €175 and that it is being brought down to €75. It is going up by 7,500%.

The Minister of State is saying that he is afraid about the double tax-back and is trying to protect the Chancellor of the Exchequer. I have heard many things in my time in this House but it is the first time that I have ever heard a Minister of State at the Department of Finance come into this House and say that all he is worried about are the takings of the Chancellor of the Exchequer. The last Parliament that worried about that matter abolished itself in 1800. I do not think we will go back to do that now. The Minister of State should not worry about the Chancellor of the Exchequer. Let us worry about our own small, indigenous businesses around this country, not about the British coffers.

The Minister of State said that we cannot make different arrangements for the UK to those made for other countries. He might look at this legislation, which specifically identifies UK tourists as being different from those from every other country in the world. They have to comply with additional conditions, including having to provide certification that they have paid their VAT and duties in the UK before they can claim it here. I said at the outset that I support that provision. I am willing to leave that provision in, but I am not willing to have a situation where the Government puts in place a double system that penalises every other tourist across the world who had that entitlement up to now. It will crucify small, indigenous businesses the length and breadth of the country. We will be pressing the amendment.

Mattie McGrath (Tipperary, Independent)
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I will not delay either. I support Deputy Naughten and the others who tabled this necessary and quite deliberate amendment. It is alarming, at this time of severe crisis, pain and suffering for all small businesses across the country and in Northern Ireland, as Deputy Ó Cuív said earlier, that we are debating these issues at the last minute, in the second last month of the year, when we should have debated them over the past two years. I too am concerned about the tourism industry. I am concerned about the products, people and VAT. To echo what Deputy Naughten said, we should not worry about the Chancellor of the Exchequer. They did not think much about us when they came into Croke Park 100 years ago last Sunday. They did not think much about the Irish when they implemented all the penal laws, and we have some of those back again now. We have our independence and it is our Exchequer that we should worry about. It is getting cleaned out at the moment, which is helping, but it is not enough to sustain small businesspeople, with the uncertainty that they have from Brexit coupled with the uncertainty caused by Covid.

The Tánaiste has been talking about having more lockdowns next year. People are being driven demented. Deputy McNamara asked a question earlier about mental health figures but we cannot get them. Our own mental health is suffering because we get so many queries and so much hassle. People are so despondent, especially at this time of year. It was refreshing to go out in the fresh air earlier on this lovely bright day, but with dark, gloomy days and long nights, people are concerned about their families, the future of their education and of their businesses. I support the amendments.

Seán Fleming (Laois-Offaly, Fianna Fail)
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I move amendment No. 10:

In page 42, line 14, to delete "€175" and substitute "€75".

Seán Fleming (Laois-Offaly, Fianna Fail)
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I move amendment No. 10:

In page 42, line 14, to delete "€175" and substitute "€75".

Brendan Howlin (Wexford, Labour)
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I move amendment No. 11:

“Review of operation of section 64

65. No later than 12 months after the coming into operation of section 64, the Minister shall— (a) review the operation of the amendments effected by that section, and

(b) lay before each House of the Oireachtas a report of his or her conclusions from the review.”.

Seán Ó Fearghaíl (Kildare South, Ceann Comhairle)
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This amendment, in the names of Deputies Howlin and Nash, was already discussed with amendment No. 9. It is being accepted, I believe. Is it agreed?

Seán Fleming (Laois-Offaly, Fianna Fail)
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It is not agreed.

Seán Ó Fearghaíl (Kildare South, Ceann Comhairle)
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It is not agreed. The Minister of State said a few minutes ago it would be agreed but now-----

Seán Fleming (Laois-Offaly, Fianna Fail)
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It was not accepted. I agreed that we would accept amendment No. 11 if amendment No. 10, to retain the €75, was agreed. Deputy Howlin has not accepted that. It was his decision not to accept it.

Brendan Howlin (Wexford, Labour)
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The Minister of State told the House he was accepting it. There is no conditionality regarding it. I was formerly told by the Minister for Foreign Affairs that the amendment was to be accepted. The Minister of State cannot, in pique, undo a speech he made half an hour ago.

Seán Ó Fearghaíl (Kildare South, Ceann Comhairle)
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Deputy Howlin has been told us now it is not accepted so-----

Seán Fleming (Laois-Offaly, Fianna Fail)
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In the interest------

Brendan Howlin (Wexford, Labour)
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Can I ask somebody else to talk to him?

Seán Ó Fearghaíl (Kildare South, Ceann Comhairle)
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Talk to whom?

Brendan Howlin (Wexford, Labour)
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Someone who has not got pique.

Seán Ó Fearghaíl (Kildare South, Ceann Comhairle)
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Sorry but we do not have proxies here. The Minister of State has said the amendment is not accepted.

Brendan Howlin (Wexford, Labour)
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I want to speak on section 64.

Seán Ó Fearghaíl (Kildare South, Ceann Comhairle)
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We have been on section 65 so I am afraid we cannot go back to section 64. We have agreed section 64. We have just disposed of amendment No. 11, which was rejected.

Brendan Howlin (Wexford, Labour)
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Can I speak on the section?

Seán Ó Fearghaíl (Kildare South, Ceann Comhairle)
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Which section? Is it section 65?

Brendan Howlin (Wexford, Labour)
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I have to get my glasses.

Seán Ó Fearghaíl (Kildare South, Ceann Comhairle)
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Can we have order for Deputy Howlin, please?

Brendan Howlin (Wexford, Labour)
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The amendment has been rejected. I wish to speak on section 65.

As Deputies know, I have served in the House for some time. I have never seen a situation like this. The Minister of State, in the course of a long debate, accepted an amendment and all the contributions were predicated on that acceptance. Then he called a vote and the amendment was voted down. The Minister of State led the House to believe that the Government had accepted the amendment. I was formally told by the Minister for Foreign Affairs that the Government had accepted it. That is simply bad faith.

As I indicated previously, this Bill is something we have worked on in consensus. It involves 11 Departments. It is a national effort to prepare for Brexit. This was the one discordant part of it. The Opposition united to say that we did not want this in the Bill. The review section was accepted by the Government and that was put on the record of the House. Then that position was resiled from when it came to a vote. That is quite shocking and not acceptable. I wanted to make that point.

It augers badly for the notion that we are working in concert, as we have done for years on the issue of Brexit, which is uniformly badly news for this country. We have stood shoulder to shoulder together in legislative preparations and other preparations. The fit of pique we witnessed with the Minister of State deciding that, because the House divided on a previous amendment, he would withdraw his support for the amendment of which we have just disposed is simply unacceptable.

Gerald Nash (Louth, Labour)
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The behaviour of the Minister of State on this has been nothing short of precious. This was not part of some transaction or deal that he did with the Labour Party on the basis that we have resiled from the initial amendment that we proposed relating to the threshold on the scheme. The Minister of State put it on the record that he was prepared to accept amendment No. 11 to allow for a review to be undertaken into the operation of the scheme. It is on the record of the House.

I do not want to accuse the Minister of State of misleading the House, because that is a different charge altogether, but he has behaved in a manner that is ill-becoming. What was done was dishonourable and deeply regrettable. I call on the Minister of State to consider his approach to this. While the damage may be done now, the Government will have the opportunity to revisit this in the context of the amendments that will undoubtedly be considered by the Seanad. I would prefer if we could deal with this here and now. The Minister of State has the opportunity to set this straight and resile from the position he has adopted.

In my view, he has behaved dishonorably in this regard.

Mattie McGrath (Tipperary, Independent)
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I wish the Minister of State well and he is new in the job but he has been around the House for a long time and has been Chairman of prestigious committees. He must understand that he gave the House information in good faith, which is how we took it, that he would do one thing and then decided he was not happy and called a vote. I will not say "misleading information" either, but the Minister of State led the House to believe one thing and then reneged on it after a long discussion and many points being made about one issue. There has been unanimous support and agreement in dealing with this omnibus Brexit Bill but the Minister of State is riding a coach and four right through it. I am confused, to say the least, or maybe he is confused. I do not know who is confused but it is certainly not good politics. If there was a mistake, perhaps it can be corrected in the Seanad, but he was intent on calling the vote, so I do not know whether it was a mistake or what it was. It is strange and bizarre.

John Brady (Wicklow, Sinn Fein)
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Certainly the word for it is "bizarre", and it was bordering on childish as well. We approached this from a united perspective and the Minister of State has single-handedly managed to turn it into a divisive exercise, when it does not need to be one. A number of Deputies from a number of parties have their names attached to amendment No. 9. My colleague, Deputy Munster, tabled an amendment in her own right and had intended on pressing it to a vote, irrespective of whether there was a deal done, which clearly there was not, between the Labour Party and the Minister of State to accept amendment No. 11. A vote would have been called on this amendment regardless but the Minister of State's actions are unbelievable. He gave a commitment to the House that he would accept the amendment and, in the next breath, out of stubbornness or childishness, he called a vote on it, taking back what he had committed to less than five minutes previously. It is bizarre and he has managed to turn something into a divisive issue when there was no need for it. There is an opportunity for him to make amends and bring forward or support amendments in the Seanad to rectify a serious mistake on the Minister of State's behalf.

Seán Fleming (Laois-Offaly, Fianna Fail)
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Members who were here for the debate know we had a discussion on these three amendments which were grouped for discussion purposes. There was one discussion on the three amendments. It was a group discussion and there was no separate discussion on each amendment. The grouping order was accepted by all Members before the debate commenced. It was agreed to discuss the three amendments together. The grouping order was agreed and everybody knew we were discussing the three together at all stages during the debate. As part of that, in an effort to assist co-operation in the matter, I put a proposal that if the proposal for the €75 was included and amendment No. 10 in the name of the Minister was accepted, we would agree to the 12-month review. There is a difference on that but the facts are the entire debate was a linked debate on the three amendments. I would understand the point if we came in and had a discussion on amendment No. 9 and a straight vote and then we came in on amendment No. 10 and there was an issue and then on amendment No. 11. However, they were grouped for discussion purposes. It is not correct for anyone to say there was not a grouped discussion on the three amendments. Everyone who spoke hopped from one amendment to another during that debate and one was contingent on the other. That is the way the debate went. It was a grouped discussion.

I know Members are disagreeing with it now but it was on that sole basis I put forward on behalf of the Government that we could look at the review. That was contingent on the Government amendment going through. It was not contingent on the basis that the Government amendment would be defeated and the only division in this House happened in respect of amendment No. 9, where the decision was made to vote against the €75. That is where the division arose in the House and there was not consensus in that group discussion, as evidenced by the Members of the Opposition who called a vote on amendment No. 9 and voted against the Government proposal. The Opposition in the group discussion demonstrated that it was not coming to an agreement on the three amendments that were down for collective discussion. My view all along was to come to a compromise without dividing the House but Members chose to vote on amendment No. 9 and divide the House.

Brendan Howlin (Wexford, Labour)
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The transcripts can be read. The words said can be read. There was no conditionality and had the Minister of State made it a condition of us not pressing amendment No. 9 and made his vote for amendment No. 11 conditional on not supporting amendment No. 9, we would not have accepted such conditionality. However, no conditionality was ever made and the transcript, which anybody can read, will show that. I am disappointed in the Minister of State.

Seán Fleming (Laois-Offaly, Fianna Fail)
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I move amendment No. 12:

In page 44, between lines 3 and 4, to insert the following:

“Insertion of Schedule 9 in Act of 2010 66. The Act of 2010 is amended by the insertion of the following Schedule after Schedule 8:

“SCHEDULE 9

Section 2(4A)

NON-APPLICATION OF SECTION 2(4A) TO CERTAIN PROVISIONS OF ACT

Part 1

Section 33

Section 34

Section 35

Section 56(1)

Section 83

Section 88(8)

Section 91

Section 91A

Section 91B

Section 91C

Section 91D

Section 91E

Part 2

Section 59

Section 101

Section 102(3)

Paragraph 5(1A) of Schedule 2

Paragraph 6(1)(c) of Schedule 2”.”.

Seán Fleming (Laois-Offaly, Fianna Fail)
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I move amendment No. 13:

In page 46, between lines 3 and 4, to insert the following:

“Amendment of Finance Act 1999

73.The Finance Act 1999 is amended— (a) in section 94—

(i) in subsection (1), by the deletion of the definition of “Member State”,

(ii) in subsection (3), by the substitution of “Subject to subsection (3A), a word” for “A word”,

(iii) by the insertion of the following subsection after subsection (3):

“(3A) In this Chapter, each reference to Member State shall apply as if the reference included a reference to Northern Ireland, save where the reference occurs in subsections (1) and (5)(c) of section 99A.”,

and

(iv) in subsection (4), by the substitution of “Subject to subsection (3A), a word” for “A word”,

and

(b) in section 101, in subsections (8)(a)(ii) and (9)(a)(ii), by the insertion of “or of the United Kingdom” after “Member State” in each place that it occurs. Amendment of Finance Act 2001

74. The Finance Act 2001 is amended—

(a) in section 96—

(i) in subsection (1)—

(I) in the definition of “European Union”—

(A) by the insertion of “, subject to subsection (3),” before “means”, and

(B) by the deletion of paragraph (c),

and

(II) in the definition of “Member State”, by the insertion of “, subject to subsection (3),” before “means”,

(ii) in subsection (2), by the substitution of “Subject to subsection (3), a word” for “A word”, and

(iii) by the insertion of the following subsection after subsection (2):

“(3) In this Part, each reference to—

(a) European Union, and

(b) Member State,

shall apply as if the reference included a reference to Northern Ireland, save where either such reference occurs in section 104(4)(a), 109(7)(c)or 109A(8).”,

(b) in section 104(1)(e), by the insertion of “or port” after “airport”,

(c) in section 109, in subsections (3)(c)(ii) and (12)(a)(ii), by the insertion of “or of the United Kingdom” after “Member State” in each place that it occurs,

(d) in section 109A, in subsections (5)(a)(ii) and (13)(a)(ii), by the insertion of “or of the United Kingdom” after “Member State” in each place that it occurs,

(e) in section 109D, by the deletion of paragraph (d),

(f) in section 109IA, in subsections (7)(a)(ii) and (14)(a)(ii), by the insertion of “or of the United Kingdom” after “Member State” in each place that it occurs, and

(g) in section 109S, by the deletion of paragraph (d).

Amendment of Finance Act 2003

75. The Finance Act 2003 is amended— (a) in section 73—

(i) in subsection (2), by the substitution of “Subject to subsection (2A), a word” for “A word”,

(ii) by the insertion of the following subsection after subsection (2):

“(2A) In this Chapter, each reference to—

(a) European Union, and

(b) Member State,

shall apply as if the reference included a reference to Northern Ireland.”,

and

(iii) in subsection (3), by the substitution of “Subject to subsection (2A), a word” for “A word”,

and

(b) in section 78A(1), by the substitution of “European Union” for “European Community”. Amendment of section 71 of Finance Act 2005

76. Section 71 of the Finance Act 2005 is amended— (a) in subsection (1), by the deletion of the definitions of “Community” and “Member State”,

(b) in subsection (5), by the substitution of “Subject to subsection (5A), a word” for

“A word”, and

(c) by the insertion of the following subsection after subsection (5):

“(5A) In this Chapter, each reference to Member State shall apply as if the reference included a reference to Northern Ireland.”.”.

Seán Ó Fearghaíl (Kildare South, Ceann Comhairle)
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Amendments Nos. 14 and 15 are out of order.

Seán Ó Fearghaíl (Kildare South, Ceann Comhairle)
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Amendment No. 16 is out of order.

Seán Haughey (Dublin Bay North, Fianna Fail)
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I wish to refer to the European arrest warrant. I raised this issue on Second Stage. Will the Minister for Justice confirm that the European Commission has issued Ireland a legal warning over delays in extraditing criminal suspects? It is my understanding that suspects wanted in other EU states should be extradited within two to three months. In 2019, 59 suspects were not extradited within the required timeframe. The explanation for this could be that the Garda needs more resources for extradition cases or the High Court is delaying in dealing with the applications.

I will agree to this section. It is necessary if we are to put in place new arrangements to deal with extraditions to the UK in the context of Brexit. Will the Minister confirm whether Ireland has been warned by the European Commission? Is she concerned about it? What will the Department of Justice do about it?

Helen McEntee (Meath East, Fine Gael)
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There is an issue with resources but delays are matters for the courts to adjudicate on. We are studying the correspondence from the Commission and are taking the matter seriously. As the Deputy outlined, this part of the Bill is important. It deals with extradition and provides for amendments to the Extradition Act 1965. One of the key issues that has been identified by my Department is the need to ensure that we have efficient arrangements between Ireland and the UK in place and that they can be maintained. In a no-deal scenario, the European arrest warrant would no longer apply to the UK. As such, this section of the Bill is important.

We only received the Commission's correspondence recently. We are taking it seriously. There is an issue with resources but applications are for the courts to adjudicate on.

Seán Haughey (Dublin Bay North, Fianna Fail)
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I thank the Minister for replying on this matter. We are good Europeans. If the Commission has issued a legal warning to Ireland, it is a serious issue and needs to be addressed. We are all familiar with the separation of powers and the High Court is doing its business. However, if it is a case of the Garda not dealing with offences that it does not consider serious, the House, in particular the Minister, would have to address the matter. I appreciate what the Minister has said. I hope that, as good Europeans, we will address the issue in due course.

Brendan Howlin (Wexford, Labour)
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I wish to ask about the procedure for extraditing someone from a third country, which will include the UK next year. Such an extradition normally goes through diplomatic channels on application to the Minister for Foreign Affairs. Will the Minister for Justice briefly indicate to us the new procedure that this section will provide? Will the Minister for Foreign Affairs devolve authority in order that the application can be made directly to the Minister for Justice by electronic means rather than the usual diplomatic means and the exchange of paper? Will the Minister, Deputy McEntee, give us a brief synopsis of the new process as she envisages extradition post January?

Helen McEntee (Meath East, Fine Gael)
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The process will not go through diplomatic channels. It will go to the Minister for Justice by electronic means.

Brendan Howlin (Wexford, Labour)
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I wish to ask a general question about the operation of the Dublin Convention in respect of the UK post January. Is there a bilateral agreement with the UK on accepting asylum applicants back? Will the Dublin Convention's provisions continue to apply?

Helen McEntee (Meath East, Fine Gael)
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The extradition and international protection arrangements will operate in a reciprocal fashion, as will the common travel arrangements, to which the next section relates. The arrangements will not necessarily be done using the same mechanisms as we are proposing in this section, but there will be some form of reciprocal arrangement in place.

Brendan Howlin (Wexford, Labour)
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Do we know what will happen from 1 January? I am aware of asylum applicants in my constituency who have transited the UK and would in normal circumstances be subject to being returned to there under the Dublin Convention's provisions. Will that situation continue to operate from January onwards?

Helen McEntee (Meath East, Fine Gael)
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I am informed that the regulations will not be exactly the same as the Dublin Convention's, but they will be similar. I am unsure of whether they have been implemented yet.

Brendan Howlin (Wexford, Labour)
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Will the Minister allow us to see the regulations?

Helen McEntee (Meath East, Fine Gael)
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If I can.

Helen McEntee (Meath East, Fine Gael)
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I move amendment No 17:

In page 94, between lines 24 and 25, to insert the following:

“PART 20

AMENDMENT OF DEFAMATION ACT 2009

Amendment of Schedule 1 to Defamation Act 2009

122.Schedule 1 to the Defamation Act 2009 is amended—

(a) in Part 1—

(i)in paragraph (11), by the substitution of “under the law of a Member State or of the United Kingdom” for “under the law of a Member State of the European Union”,

(ii) in paragraph (12), by the substitution of “in a Member State or in the United Kingdom” for “in a Member State of the European Union”,

and

(b) in Part 2—

(i)in paragraph (1), by the substitution of “in the State, in a Member State or in the United Kingdom” for “in the State or in a Member State of the European Union”,

(ii) in paragraph (2), by the substitution of “in the State, in a Member State or in the United Kingdom” for “in the State or in a Member State of the European Union”,

(iii) in paragraph (3), by the substitution of “in the State, in a Member State or in the United Kingdom” for “in the State or in a Member State of the European Union”, and

(iv) in paragraph (4), by the substitution of “in a Member State or in the United Kingdom” for “in a Member State of the European Union”.”.

Helen McEntee (Meath East, Fine Gael)
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I move amendment No. 18:

In page 9, line 27, after “Gibraltar;” to insert the following: “to make provision for the defence of qualified privilege to a defamation action to continue to apply to the publication of certain statements concerning certain events in, or connected with,the United Kingdom;”.

Thomas Byrne (Meath East, Fianna Fail)
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Ba mhaith liom mo bhuíochas a ghabháil le gach duine a ghlac páirt sa díospóireacht seo inniu. Tá sé an-tábhachtach go bhfuilimid go léir aontaithe maidir leis an mBreatimeacht agus gabhaimid buíochas leis an bhFreasúra as an gcomhoibriú atá déanta acu anseo.

I would like to express my thanks to all parties, including the Opposition parties, and Ministers who have co-operated on and contributed to what is an important Bill that is very much in the national interest. I accept all of the contributions that have been made. We divided on an issue which is of national import rather than on the overall international Brexit situation, but I appreciate the sentiments expressed by Deputies. I would emphasise that we appreciate the united approach to being taken in the House on Brexit.

The Bill is necessary, deal or no deal, and the most important message that should come out of this debate to our citizens, businesses and the British people is that whatever happens in terms of a deal in the negotiations – we wish our negotiators well – there will be significant changes when the transition period ends. I strongly encourage people who are affected by Brexit, in particular businesses, to access resources at gov.ie, and the financial supports available.

I want to thank Members for their co-operation. We will go to the Seanad and consider any amendments that are put forward there. It is very important that the Bill has been passed as quickly as possible. We will consider timetables before Christmas in terms of what happens in the Seanad. I thank Deputies for the debate and the continued united approach in the House on the Brexit issue.

Brendan Howlin (Wexford, Labour)
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There has been an extraordinary sense of common purpose in the approach to Brexit for the past four years. I have been privileged to work on the stakeholders' forum. We were briefed extraordinarily well every step of the way by the Minister for Foreign Affairs and everybody provided their input in common endeavour.

That was the approach we took to the two omnibus Bills, which are extraordinary creatures in legislative terms. A hybrid of different enactments has been piloted by the Minister for Foreign Affairs. Different sections were taken by different Ministers. We have to continue in common effort. There are many more hurdles to come.

In that vein, if the Opposition is asked, required and expected to be supportive, a little bit of reciprocal respect is expected. What happened today when a Minister accepted an Opposition amendment during a two hour debate, resiled from it at the last minute and called a vote on and defeated it leaves a sour taste in that common purpose. We will put that behind us because there will be an opportunity to address that issue again. It is an important issue for a sector of our economy. It is to be hoped our colleagues in the Seanad will be able to do something about that.

I wish the Minister for Foreign Affairs well in his endeavours. It is to be hoped that the very delicate phase that the trade negotiations are currently at will be overcome and we will have the best possible outcome - it will not be a good outcome – for all of our people as we approach a different relationship with the United Kingdom.

John Brady (Wicklow, Sinn Fein)
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The debate has been broadly good. It has been united, and that has certainly been my party's approach from the get-go. I concur with the comments from Deputy Howlin on some of the unfortunate scenes and developments during this debate. Let us not allow that to cloud the overall objective which was achieved. There is an opportunity to come back to what we have discussed. Our approach to Brexit has been good from the get-go, as I said.

There has been a united approach in trying to achieve the Irish protocol which thankfully became a common theme and demand across Europe.

Europe has been steadfast in its defence of the Good Friday Agreement and its protections for Ireland.

This legislation is very important. It is unlike the previous omnibus Bill, which was put in place in case we hit a cliff edge. We now face that, inevitably, at the end of the year. We have probably done as much as we can from a legislation perspective, but there is much more to be done. There have been some concerns and it is only appropriate that I voice them now. They are concerns from some of the leading human rights and equality organisations on the island, which are deeply concerned about the impact that Brexit is having on the protection of rights and equality provisions in the Good Friday Agreement, given that European law is critical for such supports. They have lobbied, as have others, to secure human rights protections in the EU-UK withdrawal agreement via the protocol, which guaranteed there would be no diminution of human rights as a result of Brexit.

Those groups believe, however, that there is still a threat to those rights and protections as a result of the UK Internal Market Bill and the risks associated with securing an EU-UK future relationship Bill. The groups, unfortunately, are not convinced that the Government is advocating strongly enough to ensure that those human rights protections will be secured in any agreement or in the event of no agreement. I am not speaking on my own behalf but echoing their concerns. They are not convinced that the Government is lobbying to ensure those protections will be on the table, nor that despite their requests directly to the Government and the media coverage, the Government will raise the issue at a European level or push it with the British.

I do not want to finish on a down note but concerns remain. While we are about to pass this legislation and to bring it forward, serious concerns have been expressed by some of the leading organisations and agencies that the Government is dropping the ball on these critical areas. I appeal to the Government to address these serious concerns. If it is the case that the Government is not doing enough about these issues - by the sounds of it, it is not - it needs to up its game, because they are critical.

Seán Ó Fearghaíl (Kildare South, Ceann Comhairle)
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Is someone else offering? I cannot see.

Thomas Byrne (Meath East, Fianna Fail)
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Deputy Michael Healy-Rae.

Seán Ó Fearghaíl (Kildare South, Ceann Comhairle)
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Sorry, Deputy Healy-Rae. I do not normally miss you.

Michael Healy-Rae (Kerry, Independent)
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This place is too big; I have been indicating for quite a while. Obviously, Brexit will cause an awful lot of upheaval and complications in many sectors of all our lives. I do not know whether it was good or bad fortune, although I enjoyed it thoroughly, to work with the excellent, hard-working Oireachtas Joint Committee on European Union Affairs, comprising all parties and none, over a number of years while preparedness for Brexit was taking place. One issue that I have begged the Government to address relates to the urgent need for a bilateral agreement with Britain on the cross-border directive, whereby people seeking urgent medical healthcare will be able to travel North to receive the excellent care they get in private hospitals, and that our health service can pay for it. As recently as last weekend, I sent a busload of patients from County Kerry to Belfast, where they received excellent care in a manner in which they could afford to pay for it.

The big problem is that, right now, I have more people ready to go, before the danger zone of 31 December, but there is such pressure on the hospital at the moment that it does not think it will be able to cater for all the patients coming from the South. Between 5,000 and 6,000 used that service last year. It is for care. There is nothing more important in this world, in my book anyway, than our two eyes, because we have only two. If we lose one, we will be down to one eye, and if we lose that, we will be down to nothing. Sadly, I know people who have gone blind waiting to have cataracts removed in our country and that is wrong.

I am again pleading with the Government to please come to some sort of arrangement or bilateral agreement with the UK Government whereby we will still be able to avail of cross-border initiatives such that the funding can be supplied and that these patients can receive treatment, whether for their hips, knees or cataracts. Many of these people are elderly but many are not. I thank the Ceann Comhairle for allowing me the opportunity to discuss the issue.

Seán Ó Fearghaíl (Kildare South, Ceann Comhairle)
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That is a very important matter that we know the Deputy is deeply concerned about. It was discussed twice earlier and I suppose the third time helps emphasise the case.

Cian O'Callaghan (Dublin Bay North, Social Democrats)
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I echo the comments of other Deputies about the importance of the cross-party and unified approach to the issue. If we do end up with no trade deal, and I very much hope we will not, how that will impact tariffs, the cost of living and food prices, especially for low-income households, will need immediate attention. I hope that is worked on on a cross-party and unified basis, as everything else with respect to Brexit has been.

Thomas Byrne (Meath East, Fianna Fail)
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I again thank all Deputies for their genuine co-operation. I accept what they said and I think they accept the trust we need in the country's negotiation position. The negotiations in the days ahead will be difficult. I reiterate my message that no matter happens, deal or no deal, significant changes are coming and we need this legislation in order to ensure we are ready for that.

I do not accept what Deputy Brady said about us not fighting for the human rights of citizens in Northern Ireland. Unfortunately, the citizens of Northern Ireland are victims of a decision to leave the European Union taken by people across the sea from them. We have worked with might and main with every party in the House - the previous Government and this one - to ensure that the needs of the people of Ireland, North and South, would be top of the agenda. I am pleased to report that every Minister I speak to tells me they have two priorities for the negotiations, namely, the Good Friday Agreement and the rights of the citizens of Ireland, and the European Single Market. Both issues are crucial to us and those in the North. I do not, therefore, accept that criticism. We are working very hard on this and the negotiators, led by Michel Barnier, the Commissioner who set up the PEACE programme for funding Border counties in the North, are intimately aware of the issues facing the North and the wider island. I am grateful for all their input and everybody else's in the House.

We are continuing to work on the cross-border treatment directive. Unfortunately, this just one of the consequences of Britain leaving the European Union but the Taoiseach and the Minister for Health are working to try to find a solution. It presents difficulties but we want to solve it, and I assure Deputies of that. These are not straightforward issues and others will undoubtedly transpire in the new year. There will be inconveniences and difficulties caused solely by the decision of the United Kingdom to leave the European Union. We as a nation - our businesses and citizens - have made significant preparations but there will be contingencies that we simply will not be able to deal with.

There will be disadvantages to Britain leaving the European Union that will be completely outside of our control. There are huge changes coming. I encourage everybody to look at the resources available online, including on gov.ie, and I urge businesses to avail of the supports we are providing. As I said, there are big changes coming.