John Perry (Sligo-Leitrim, Fine Gael)
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Question 138: To ask the Minister for Finance the property based tax reliefs for which no termination date has been set; and if he has requested any reviews of these or other reliefs by the Revenue Commissioners. [4173/07]

Brian Cowen (Laois-Offaly, Fianna Fail)
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In Budget 2006, following a major review of various existing tax reliefs involving both internal reviews and the employment of outside consultants I announced the termination, subject to certain transitional provisions, of the following reliefs; the urban renewal, town renewal and rural renewal schemes, and the special reliefs for hotels, holiday cottages, student accommodation, multi-storey car parks, third-level educational buildings, sports injuries clinics, developments associated with park and ride facilities and the general rental refurbishment scheme.

In line with the recommendations of the consultants, I retained the tax reliefs available for private hospitals, convalescent homes, registered nursing homes and childcare facilities. Finance Act 2006 introduced a new scheme of capital allowances for qualifying mental health centres which commenced on 23 January 2007.

In addition to the special property-based tax schemes covered by last year's reviews, Section 268 of the Taxes Consolidation Act 1997 provides for capital allowances for a range of buildings or structures. These are normal business related capital allowances rather than special incentive schemes.

The operation and impact of tax reliefs are monitored and/or subject to review on an ongoing basis as part of the normal work of my Department and the Revenue Commissioners. For example, I introduced a number of changes to the research and development tax credit scheme in Budget 2007 on foot of an interim review of the operation of the scheme to date. I have also asked for an updated review of the scheme of capital allowances for residential units associated with registered nursing homes which scheme is due to terminate next year. A report of this review has now been received and is being examined. Last year my Department, in conjunction with the Department of Enterprise, Trade and Employment and the Revenue Commissioners, carried out a review of the Business Expansion Scheme (BES) and the associated Seed Capital Scheme (SCS), both of which were due to expire on 31 December 2006. As part of this review, questionnaires were sent to nearly 1400 companies who had used the schemes in the past.

On foot of this review (which will shortly be published in full), I decided in Budget 2007 to renew the BES from 1 January 2007 for a seven year period to 31 December 2013. The BES company limit is being increased from €1 million to €2 million, subject to a maximum of €1.5 million to be raised in a twelve month period. The investor limit is being increased from €31,750 to €150,000.

As the BES and the SCS are State aids, the continuation of the schemes and the proposed changes will require the approval of the European Commission and will be subject to assessment by the Commission under the new "Community Guidelines on State Aid to Promote Risk Capital Investments in Small and Medium-Sized Enterprises" (2006/C 194/02) published in the Official Journal of the European Union in August 2006.