Paul Kehoe (Wexford, Fine Gael)
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Question 493: To ask the Minister for Finance if he will confirm the position whereby a person receives an inheritance of agricultural land (details supplied); and if he will make a statement on the matter. [28951/06]

Brian Cowen (Laois-Offaly, Fianna Fail)
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I am informed by the Revenue Commissioners that, under the provisions of Section 89 of the Capital Acquisitions Tax Consolidation Act 2003, where agricultural property comprised in an inheritance is disposed of within six years after the date of the inheritance, a claw-back of agricultural relief will only occur where the proceeds from the disposal are not fully expended in acquiring other agricultural property within a year of the disposal. The extent of the claw-back relates to the amount of the proceeds not being so re-invested.

However, in the case where a person receives an inheritance of agricultural land and has claimed agricultural relief on the inherited land but then subsequently makes a voluntary gift of that land to a niece or nephew, a claw-back of the agricultural relief granted to the person when he or she inherited the land will not occur. This is because, in this situation, no proceeds have been received for the disposal of the land and a claw-back of the agricultural relief granted can only occur where actual proceeds are received for the disposal and then not appropriately re-invested.

For Capital Acquisitions Tax purposes therefore, a voluntary disposition without the receipt of proceeds does not result in a claw-back of agricultural relief. However, the Deputy may wish to note that depending on the circumstances a Capital Acquisitions Tax (gift tax) liability may arise for the niece or nephew. If the Deputy has a specific case in mind he may wish to contact the Revenue Commissioners with further details.

Ruairi Quinn (Dublin South East, Labour)
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Question 494: To ask the Minister for Finance if his attention has been drawn to the ruling by the European Court of Justice on 12 September 2006 (details supplied) and the consequent implications for the interface between multinationals operating within the European Union and the national corporation tax rates offered by individual European states; the changes which, are necessary in the taxation code here to consolidate and secure Ireland's present position; if he anticipates that the Commission will attempt to request him and other Ministers to co-ordinate or otherwise alter their Government policies in this area; and if he will make a statement on the matter. [28995/06]

Brian Cowen (Laois-Offaly, Fianna Fail)
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I am aware of the ECJ ruling that the Deputy has referred to. As in the case of all such matters my officials are examining the longer term implications of the judgement. While not wishing to speculate on what the Commission might do, I should remind the Deputy that direct taxation matters are in the competence of individual Member States and not the Commission.