Michael McGrath (Cork South Central, Fianna Fail)
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Question 86: To ask the Minister for Finance his views on the proposed introduction of a financial transactions tax in the EU; if he has undertaken an assessment of the way such a tax would impact on employment in the International Financial Services Centre in Dublin; if he believes a UK opt out from such a tax would put the IFSC at a significant competitive disadvantage; and if he will make a statement on the matter. [40672/11]

Michael Noonan (Limerick City, Fine Gael)
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In October the European Commission published its proposal for a Financial Transactions Tax, or FTT, and its assessment of the impact of the measure. We are analysing the proposals in the draft Directive. The proposal will now be subject to detailed discussions at Council Working Party level and, as always, we will participate constructively in those discussions.

There is no consensus as yet among European Member States on this issue, either about whether an FTT should be introduced, or what precise form it should take.

It is important that any proposal does not have the effect of encouraging relocation of activity or damaging the EU's competitiveness in financial services. It is for this reason that there is an emerging view that the EU and other international groupings, such as the IMF and G20, should move in tandem in a global manner to avoid the danger of financial sector business gravitating to jurisdictions where taxes are not levied on financial transactions. Indeed the Commission has indicted that they see their proposal as part of a wider development in this area.

I have said previously that any FTT would be best applied on a wide international basis to include the major financial centres. I also think it important that the proposed Directive would apply on an EU wide basis to prevent any distortion of activity within the European Union. As I stated in response to the Deputy on 5 October last, if the UK decides not to impose an FTT, there would be a great risk of displacement of business from our financial services sector.

The matter will be discussed again next year at an ECOFIN meeting once the Council Working Party has discussed the proposal.

Michael McGrath (Cork South Central, Fianna Fail)
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Question 87: To ask the Minister for Finance the amount of tax paid by companies operating in the International Financial Services Centre, Dublin in 2010; and if he will make a statement on the matter. [40673/11]

Michael Noonan (Limerick City, Fine Gael)
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I am informed by the Revenue Commissioners that the estimated corporation tax paid in 2010 by the Irish Financial Services Centre is of the order of €630 million. With the change in the corporation tax rate from 10% to the standard rate now applying to IFSC activities it is generally speaking no longer possible to distinguish between corporation tax paid solely on IFSC activities and on other income. An exception is made in the case of the main associated banks where an estimate of the tax paid by them on their IFSC activities is derived from indicative data available. This estimate is incorporated in the €630 million figure provided above.

Other tax remitted by the IFSC, such as PAYE, DIRT on deposit interest, and stamp duties on credit cards, ATM cards and cheques, are not included in the figures given, since the tax liability is not on the institutions themselves.