Pearse Doherty (Donegal, Sinn Fein)
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208. To ask the Minister for Finance if his attention has been drawn to the fact that a growing number of developers and speculators are using special purpose vehicles, including section 110 companies, ICAVs and qualifying investor funds for tax efficient reasons to structure their business dealings in land and property; and if he will make a statement on the matter. [24408/16]

Michael Noonan (Limerick City, Fine Gael)
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I am aware of the recent media coverage and references in the Dail regarding the use of special purpose vehicles including section 110 companies for property transactions, without paying a level of tax that should be applicable to such transactions.

In light of this I have moved to publish a proposed amendment to section 110 of the Taxes Consolidation Act 1997 which I believe will ensure that Ireland's tax base remains protected when business dealings involving land or property are undertaken using the section 110 regime. The proposed amendment as published on the 6th of September is intended to apply to profits arising from the business of qualifying companies that involve the holding, managing or both the holding and managing of specified mortgages, including any activities which are ancillary to that business, after 6 September 2016. Specified mortgages refers to any financial asset that derives its value, or the greater part of its value directly or indirectly, from land in the State. The part of the section 110 company's business that relates to specified mortgages will be treated as a separate business from any other business the company may carry on and, with certain exceptions, no interest above an arm's length rate will be deductible in computing the taxable profits of that part of the business.

Targeted measures regarding the use of funds in the Irish property market are also being prepared for my consideration.