Mary Mitchell O'Connor (Dún Laoghaire, Fine Gael)
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41. To ask the Minister for Finance the reason no tax relief is in place for donations in support of sports development projects aimed at increasing participation or for the support of high performance or developing athletes, when there is a relief in place in respect of sports facilities capital projects and sport is the only area of the not for profit sector not to benefit from such a relief; and if he will make a statement on the matter. [39029/14]

Michael Noonan (Limerick City, Fine Gael)
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As the Deputy will appreciate, in general,  any new tax relief should only be considered if there is a clear evidence of market failure and if there are compelling reasons why an intervention through the tax system would be more effective than a direct exchequer grant or subsidy.

Any new proposal for a potentially significant tax expenditure should be subject to an ex-ante cost benefit analysis and evaluation process.

It is important that evaluations endeavour, where possible, to take account of the following effects:

- Deadweight (or additionality);

- Displacement; and,

- Opportunity costs.

Deadweight is an economic concept that attempts to capture the amount of activity that would have taken place anyway in the absence of the incentive or scheme.

Displacement refers to a situation where some of the benefits associated with the scheme occur at the expense of other, non-beneficiaries.

A fundamental principle of economics is that all resources (capital, labour, public funds) have an opportunity cost reflecting their value in an alternative use. These costs must be taken into account in evaluations. In particular, for tax expenditure evaluations two types of opportunity costs should be considered:

- The opportunity cost of labour; and,

- The opportunity (or marginal) cost of public funds.

In relation to the specific proposal, I would point out that there are a number of other reliefs available for sports, including the capital projects you mention in your question and retirement relief for certain sportspersons which was introduced in Finance Act 2002. The categories of sportspersons that can avail of tax relief are listed in Schedule 23A of the Taxes Consolidation Act 1997, (TCA). These categories originally included athletes, badminton players, boxers, cyclists, footballers, golfers, jockeys, motor racing drivers, rugby players, squash players, swimmers and tennis players.

There is scope for me, as Minister for Finance, to add to this list by regulation after consultation with the Minister for Transport, Tourism and Sport if a justifiable case is made on behalf of categories of sportspersons with direct earnings that are excluded.

I have no plans to introduce tax relief for donations to sports development projects at this time.