Liam Twomey (Fine Gael)

I move recommendation No. 1:

In page 9, before section 1, to insert the following new section:

"PART 1

Commission on Taxation.

1.—The Minister shall ask the Commission on Taxation to produce a report within 6 months of the commencement of the Act to address the following matters:

(a) private hospital and nursing home tax exemptions,

(b) property based tax breaks,

(c) the impact of the value added tax differential between the north of Ireland and the south of Ireland,

(d) persons claiming to be non-resident for tax purposes,

(e) the impact of the 1 per cent levy on consumer spending.".

This is a very good amendment because it examines the Commission on Taxation. The Commission on Taxation was given a lot of work to do in the last budget. It has to examine a range of tax concessions and new taxes which the Government would like to impose, but it is important the commission examines the effects many of these tax breaks have on our economy. For many exemptions, such as the private hospital and nursing home tax exemptions, we do not know how much they cost the Government.

A number of years ago the then Minister for Finance, former Deputy McCreevy, put a clause into the Finance Bill whereby everybody who claimed these, mainly property-based, tax breaks had to fill in tax returns to let the Government know exactly how much they were benefiting from this. The Government should easily be able to put this information together and find out how much people are benefiting from tax loopholes. The impact of the private hospital and nursing home tax exemption, property based tax breaks and the VAT difference between the North and South of Ireland are all very important.

Some are trying to make out that the only reason people are flying up to Northern Ireland is the sterling-euro exchange rate but there is a large difference between VAT rates North and South and that is having a major impact. It also gives the perception that there is a problem. We should be seeking to normalise trading between the North and South of this island in the long term. We see many high profile cases of people claiming to be non-residents for tax purposes and avoiding significant amounts of tax. The impact of the 1% levy on consumers is very important and I would like to hear the Minister's views on that.