Simon Harris (Wicklow, Fine Gael)
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Question 68: To ask the Minister for Finance if he will consider extending the mortgage interest relief scheme to those who purchased their first property in 2003; and if he will make a statement on the matter. [9002/12]

Michael Noonan (Limerick City, Fine Gael)
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The position is as I stated in my Budget day speech, that the Government has now fulfilled its commitment contained in the Programme for Government to increase the rate of mortgage interest relief to 30 per cent for first-time buyers who took out their first mortgage in the period 2004 to 2008. I have sought to be as flexible as possible within the constraints pertaining. Under the current tax legislation mortgage interest relief is granted from the date the first mortgage interest payment is made. The legislation is being amended for this particular measure to also include mortgage draw-down as a qualifying event for the rate increase. This means that a mortgage holder will qualify for the increased rate if they made their first mortgage interest payment in the period 2004 to 2008 or if they drew down their mortgage in that period.

Therefore, an individual who drew down their mortgage in December 2003 but made their first mortgage interest repayment in 2004 will qualify for the increased relief.

However, I do not intend to extend the period any further as the measure would become less targeted and would increase in cost.

Michael Healy-Rae (Kerry South, Independent)
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Question 69: To ask the Minister for Finance his views regarding tax breaks for persons who wish to come here to provide employment (details supplied); and if he will make a statement on the matter. [9014/12]

Michael Noonan (Limerick City, Fine Gael)
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The Deputy will be aware that the number one priority of the Government is jobs. The Special Assignee Relief Programme (SARP) is designed to help attract key individuals to the Irish based operations of their employers. It is hoped that additional foreign direct investment and additional jobs will result from the introduction of SARP. In addition to SARP, other measures introduced in Budget 2012 include changes to the Research and Development (R&D) tax credit scheme as follows:

Volume basis

The first €100,000 of qualifying R&D expenditure will benefit from the 25% R&D tax credit on a volume basis. The tax credit will continue to apply to incremental R&D expenditure in excess of €100,000 as compared with such expenditure in the base year 2003. This will provide a targeted benefit to Small and Medium Enterprises (SMEs).

Outsourcing limits At present sub-contracted R&D costs are eligible where they do not exceed 10% of total costs or 5% in the case of sub-contracting to third level institutions. This limit can disproportionately affect smaller companies who may have greater need to outsource R&D work than larger multinationals with greater internal resources. The outsourcing limits for sub-contracted R&D costs are being increased to the greater of 5 or 10% as appropriate or up to €100k. This will provide a targeted benefit to SMEs.

Use of the credit to reward R&D employees

Companies in receipt of the R&D credit will have the option to use a portion of the credit to reward key employees who have been directly involved in the development of R&D. It is envisaged that there would be no additional cost to the Exchequer as the bonus comes from the R&D credit already received by the company and the employee still pays the full tax liability on their other income. This change will be monitored closely and if abused will be removed.

Furthermore, a scheme was introduced in Budget 2009 which provides relief from corporation tax on the trading income and certain gains of new start-up companies in the first three years of trading, and was modified in 2011 so that the value of the relief will be linked to the amount of employers' PRSI paid by a company. Budget and Finance Bill 2012 extends this scheme for the next three years to include start-up companies which commence a new trade in 2012, 2013 or 2014.

I would like to point out to the Deputy that there are also a number of other tax incentives available to SMEs in the tax code.

The Employment and Investment Incentive was commenced on 25 November 2011. This scheme replaces the Business Expansion Scheme and helps SME's to raise private investments with a view to job creation and maintenance. Tax relief is available to the relevant investors and an additional amount of tax relief is payable where jobs have actually been created over the investment period or if the company has spent at least 30% of the monies raised on research and development activities.

The Foreign Earnings Deduction which I announced in the Budget, and which is provided for in the Finance Bill, is available to all companies regardless of their size. This incentive is designed to assist companies in accessing the export markets of Brazil, Russia, India, China and South Africa by providing a tax relief to the individuals that undertake trade missions to the countries specified.

The Revenue Job Assist scheme is also available to help companies to employ individuals that have been unemployed for 12 months or more. This scheme provides a double deduction to employers in respect of the salary of the qualifying individuals for a period of three years and also provides tax relief to the individual, on a sliding scale, over the same three year period.

The Deputy may wish to also seek information on the grants available to SMEs from the Department of Jobs, Enterprise and Innovation, and information on certain PRSI incentives for employment that are available from the Department of Social Protection.