Results 6,501-6,520 of 15,555 for speaker:Eoghan Murphy

Select Committee on Finance, Public Expenditure and Reform, and Taoiseach: Finance Bill 2016: Committee Stage (Resumed) (15 Nov 2016)

Eoghan Murphy: The phrase itself comes from the tax Acts and is used consistently within the tax Acts. That is why that particular phrase is being used. Revenue is independent of Government and we have received advice that this would allow Revenue to work the Act as it is intended. The establishment of a reporting mechanism is being thought through, but there is a risk in that there are such a small...

Select Committee on Finance, Public Expenditure and Reform, and Taoiseach: Finance Bill 2016: Committee Stage (Resumed) (15 Nov 2016)

Eoghan Murphy: I will come back to the Deputy on that.

Select Committee on Finance, Public Expenditure and Reform, and Taoiseach: Finance Bill 2016: Committee Stage (Resumed) (15 Nov 2016)

Eoghan Murphy: The residential mortgage-backed securities and the commercial mortgage-backed securities, which the Deputy outlined, are defined in the amendments so that they are the only securitisation transactions undertaken by banks within the EU's capital requirement regulation. The use of section 110 vehicles for these transactions is simply the facilitation of the repackaging of the risk. In most...

Select Committee on Finance, Public Expenditure and Reform, and Taoiseach: Finance Bill 2016: Committee Stage (Resumed) (15 Nov 2016)

Eoghan Murphy: The originator has to be a bank though. It still needs to be permissible for a bank to securitise its loan book in this way, regardless of whether it is made up of commercial or residential mortgages. Under the capital requirements regulation, the bank retains a portion of the risk. It is difficult, therefore, to see why a section 110 vehicle would try to step into this given that it would...

Select Committee on Finance, Public Expenditure and Reform, and Taoiseach: Finance Bill 2016: Committee Stage (Resumed) (15 Nov 2016)

Eoghan Murphy: I do not think the Deputy is correct. Section 110 vehicles are a normal form of securitisation, so why would the banks not use them to securitise loan books?

Select Committee on Finance, Public Expenditure and Reform, and Taoiseach: Finance Bill 2016: Committee Stage (Resumed) (15 Nov 2016)

Eoghan Murphy: First, the use of section 110 in aviation financing is relatively recent. That is not one of the reasons section 110 was created. It was created to allow, for example, a bank to pool its debt and sell it as cash flow to a third party. There are benefits to doing that other than trying to avoid taxation. It would be done to diversify risk, to reinvest or to free up space in terms of...

Select Committee on Finance, Public Expenditure and Reform, and Taoiseach: Finance Bill 2016: Committee Stage (Resumed) (15 Nov 2016)

Eoghan Murphy: No, it ring-fences the security completely from-----

Select Committee on Finance, Public Expenditure and Reform, and Taoiseach: Finance Bill 2016: Committee Stage (Resumed) (15 Nov 2016)

Eoghan Murphy: It is a way of ring-fencing the security that is the loan book from the entity. If the entity wants to securitise itself off into an special purpose vehicle, SPV, it can do so through a section 110 vehicle.

Select Committee on Finance, Public Expenditure and Reform, and Taoiseach: Finance Bill 2016: Committee Stage (Resumed) (15 Nov 2016)

Eoghan Murphy: Section 110 is just another way of achieving that securitisation, which is done in other jurisdictions, as Deputy Donnelly stated, but it would be wrong to say that the only purpose of using section 110 is to avoid tax. It is tax-neutral. Being tax-neutral is not about tax avoidance, however, it is about choosing neutrality, whether it is an individual investor or-----

Select Committee on Finance, Public Expenditure and Reform, and Taoiseach: Finance Bill 2016: Committee Stage (Resumed) (15 Nov 2016)

Eoghan Murphy: We can take it up again on Report Stage, if that is okay. The advice we have been given is that it will not be possible for them to do as the Deputy describes.

Select Committee on Finance, Public Expenditure and Reform, and Taoiseach: Finance Bill 2016: Committee Stage (Resumed) (15 Nov 2016)

Eoghan Murphy: Yes, and that will be tax avoidance. We will get a proper note for the Deputy on it.

Select Committee on Finance, Public Expenditure and Reform, and Taoiseach: Finance Bill 2016: Committee Stage (Resumed) (15 Nov 2016)

Eoghan Murphy: Deputy Donnelly has been engaging with the officials on this and the engagement has been helpful in our trying to get to same place in terms of what the policy is trying to achieve.

Select Committee on Finance, Public Expenditure and Reform, and Taoiseach: Finance Bill 2016: Committee Stage (Resumed) (15 Nov 2016)

Eoghan Murphy: The expectation is that it will not happen because it has not happened in terms of commercial or residential mortgage securitisations. That is why they are being stepped out of this. It is to allow it to remain in place so that the banks can continue that with legitimate securitisation. There does not seem to be a risk that foreign institutional investors would then try to step into that...

Select Committee on Finance, Public Expenditure and Reform, and Taoiseach: Finance Bill 2016: Committee Stage (Resumed) (15 Nov 2016)

Eoghan Murphy: When it comes to the anti-avoidance provisions in the section, I think the policy position is the same in terms of from where the Government and the committee are coming.

Select Committee on Finance, Public Expenditure and Reform, and Taoiseach: Finance Bill 2016: Committee Stage (Resumed) (15 Nov 2016)

Eoghan Murphy: Absolutely not.

Select Committee on Finance, Public Expenditure and Reform, and Taoiseach: Finance Bill 2016: Committee Stage (Resumed) (15 Nov 2016)

Eoghan Murphy: It is specific to the IREF but to come back on it quickly, if they were to do that and to backdate, clearly that would be fraud because they are trying to avoid paying the tax in a demonstrable way because it is linked to the date on which the section 110 amendment was first published, so they could not do that. However, even if they did step into a QIF for an Irish collective asset...

Select Committee on Finance, Public Expenditure and Reform, and Taoiseach: Finance Bill 2016: Committee Stage (Resumed) (15 Nov 2016)

Eoghan Murphy: There is an anti-avoidance measure included. I believe it was explained previously in a technical briefing insofar as last man standing principles are concerned-----

Select Committee on Finance, Public Expenditure and Reform, and Taoiseach: Finance Bill 2016: Committee Stage (Resumed) (15 Nov 2016)

Eoghan Murphy: -----but the intention of this amendment is to make sure there will always be a withholding tax for the QIF, the ICAV or whatever it may be if it becomes an IREF. It depends on the point at which that tax potentially will be levied, but there would be a tax. The CGT point is a separate point we might come back to in the IREF section.

Select Committee on Finance, Public Expenditure and Reform, and Taoiseach: Finance Bill 2016: Committee Stage (Resumed) (15 Nov 2016)

Eoghan Murphy: CGT is being introduced for IREFs that dispose of their asset within five years.

Select Committee on Finance, Public Expenditure and Reform, and Taoiseach: Finance Bill 2016: Committee Stage (Resumed) (15 Nov 2016)

Eoghan Murphy: Yes, but it is being introduced for those who dispose of it within five years. Currently, there is no CGT, so the policy decision being taken is to introduce CGT if the asset is disposed of within five years.