Michael Lowry (Tipperary North, Independent)
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Question 128: To ask the Minister for Finance the reason, in view of the fact that capital allowances were extended to include hotels, guesthouses, holiday hostels and holiday camps, the caravan and camping sector was not included at that time; the reason he has not included such measures in the Finance Act 2007 to include registered caravan and camping parks to enable this sector of the tourist industry compete on an even playing field with other accommodation providers; and if he will make a statement on the matter. [10903/07]

Brian Cowen (Laois-Offaly, Fianna Fail)
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Section 34 of the Finance Act 2005 introduced a number of changes to the capital allowance regime for hotels, guesthouses, holiday hostels and holiday camps. Guesthouses and holiday hostels were specifically brought into the capital allowances regime for the first time. Also, the entitlement to the capital allowances was provided for the first time on the basis of buildings being registered in the appropriate Fáilte Ireland register. These changes were made to clarify what constituted a building or structure "in use for the purposes of the trade of hotel keeping". This term had been causing problems for a number of years and lead to many appeals in relation to "hotel-type" capital allowances being claimed for various types of accommodation facilities — whether or not they were included in any Fáilte Ireland register.

Following the Finance Act 2005 changes, the Revenue administrative practice of granting capital allowances in respect of buildings and structures erected in registered caravan parks was reviewed in consultation with my Department and the Department of Arts, Sport and Tourism. As a result of these deliberations, and of the basis on which "hotel-type" capital allowances had been put on a statutory footing, it was decided that retention of a non-statutory scheme on behalf of caravan parks was not appropriate. This non-statutory practice was withdrawn by way of publication in the Revenue Commissioners' Tax Briefing No. 60 (dated August 2005) with effect from 1 January 2006. Allowances in respect of expenditure incurred before that date are not affected.

It should be noted that some of the expenditure that would typically be incurred by these caravan park operators may be eligible for the "plant and machinery" capital allowances but this would not generally include any buildings or structures. I have no plans at this time to extend the existing regime of capital allowances to registered caravan and camping parks. However, I will bear this matter in mind for future consideration.