Paschal Donohoe (Dublin Central, Fine Gael)
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Question 170: To ask the Minister for Transport, Tourism and Sport the benefits to the employment register here as direct result of the tonnage tax relief for shipping companies; and if he will make a statement on the matter. [26516/11]

Leo Varadkar (Dublin West, Fine Gael)
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The European Commission approved the Irish Tonnage tax regime in December 2002. The regime was introduced by the Irish Government as a direct measure that was designed to halt the decline in the Irish shipping industry and prevent the migration of the shipping industry to alternative jurisdictions. The Irish Tonnage Tax is part of the Irish Corporation Tax rules. A qualifying company may choose to be taxed on its trading income under normal corporation tax rules or choose to elect to Irish tonnage tax for a period of 10 years and incur tax on its tonnage consistent with rates in other EU regimes.

The introduction of the Irish Tonnage Tax regime has had a positive impact on employment, investment and the sustainable development of the Irish Shipowning and shipping services sector. As of December 2010 there were 45 qualifying companies operating in the Irish tonnage tax regime, an increase of 16 over 2009 . There were 346 individuals employed in shore based positions with Irish tonnage tax companies. This represents an increase of 10% over 2009 in direct employment.

The 10% increase in employment does not take into account the additional indirect jobs created or supported by this activity in other segments of the Irish shipping cluster such as maritime law, accounting, ship broking and finance sectors. My Department does not have figures for these.

In addition, the majority of the companies availing of the Tonnage tax regime have displayed a strong commitment to the training and support of Irish cadet training programs at the National Maritime College of Ireland. The current 10 year period of Irish tonnage tax is due to expire in December 2012 and my Department will be seeking an extension of the scheme.