Martin Mansergh (Fianna Fail)

The prime utility of a Bill of this kind is for tax practitioners to advise their clients. I was disappointed to hear today at an informal briefing on the Finance Bill by Department officials that this Bill will be amended again almost as soon as it is passed. This is for technical procedural reasons. They are across the board amendments that apply to all taxes to do with admissibility of claims for repayment. I suggest that when those amendments are made a simple addendum be added to the Bill, so that it is still all together for practitioners and is not out of date almost as soon as it is passed.

I wish to make a few general comments about capital acquisitions tax. In general we have a mild regime compared to most other countries. One area affects rural Ireland particularly, the case of farms. Farms do not always pass from father to son or daughter. They can be passed to brothers, nephews, cousins and so on. While there is provision for a favourite nephew, or niece these days, I am not sure it covers all cases. I remember from my days in the tax strategy group that quite a heavy part of the yield from capital acquisitions tax comes from transfers within the wider family. Obviously, the State needs money but it would help families if some latitude were allowed and the situation eased a little.

Those of us who were around in the 1980s remember great political debates between parties as to how capital and corporation tax yield could be improved. Those on the left of the political spectrum were particularly interested in those improvements. In 1986 capital taxes raised about £34 million. In the Estimate for this year it is over £800 million or €1,100. One of the biggest successes we have had, partly through reduction in the rates but also through general improvements in the economy, is that we now get a substantial contribution from capital and corporation tax. A lot of services would not be running if we did not have the yield we now have from these taxes. I welcome this Bill as a means of more efficient administration of these taxes.