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In Bed with the Developers
Read more about: Democracy, Economy, Fianna Fail, Labour Party
Were things good, Joan Burton would be roundly accused of talking down the economy. However, things aren’t good and so the answer to her Parliamentary Question on tax reliefs for construction holds some pretty grim reading. In the financial year 2006, the government waved of €464.4m in 19 property based tax exemption schemes. This included €64m for student accomodation and €140m in urban renewal.
The government over the same period the tax foregone on the Business Expansion Scheme and the Seed Capital Scheme was just €21.4m and €1.2m respectively. Granted this is not all the money available to business and via a variety of bodies like the IDA, FAS and others subsidies are given to development and skills. However the stark contrast in figures chimes with the sense that we all have now of a party in government which prioritised those who lobbied hardest - our friendly developers - over the much vaunted knowledge economy.
As others have written on this topic, the support for tech startups and small business is negligible and something that other opposition parties can make hay out of. Indigenous enterprise will be required to dig us out of this hole, if we are to use tax breaks to incentivise economic benefit it should go to those business who can provide sustainable long term jobs.
The PQ is below the fold.
DÁIL QUESTION
NO 232
To ask the Minister for Finance the amount of tax that was foregone under each of every property tax based scheme in 2006 and 2007; and if he will make a statement on the matter.
* For WRITTEN answer on Tuesday, 11th November, 2008.
Ref No: 39627/08
Minister for Finance ( Mr Lenihan) :
I am informed by the Revenue Commissioners that the amount of tax foregone under each property-based scheme in 2006 is as follows:-
| Scheme |
Tax Cost
€m |
| Urban Renewal | 140.5 |
| Town Renewal | 38.7 |
| Seaside Resorts | 6.4 |
| Rural Renewal | 38.0 |
| Multi-storey car parks | 16.6 |
| Living over the shop | 2.7 |
| Enterprise Areas | 3.0 |
| Park and Ride | 2.8 |
| Holiday Cottages | 9.5 |
| Hotels | 106.6 |
| Nursing Homes | 14.7 |
| Housing for the Elderly/Infirm | 1.4 |
| Hostels | 0.82 |
| Guest houses | 0.08 |
| Convalescent Homes | 1.7 |
| Qualifying (Private) Hospitals | 10.6 |
| Qualifying sports injury clinics | 0.0 |
| Buildings used for Childcare Purposes | 6.0 |
| Student Accommodation | 64.3 |
| Total |
464.4
It should be noted that the cost of tax relief for property tax based schemes which still remain in the tax code is estimated at just over €34 million for 2006. |
I am advised by the Revenue Commissioners that data for the tax year 2007 is not yet available as the appropriate income tax and corporation tax returns for that year are either not yet due for filing (by 17th November 2008 in the case of returns filed via ROS) or have only recently been filed but have not yet been processed.
DÁIL QUESTION
NO 233
To ask the Minister for Finance the amount of tax that was foregone under the business expansion scheme and the seed capital scheme respectively in 2006 and 2007; and if he will make a statement on the matter.
* For WRITTEN answer on Tuesday, 11th November, 2008.
Ref No: 39628/08
Minister for Finance (Mr Lenihan):
I am informed by the Revenue Commissioners that the estimated tax foregone in respect of the Business Expansion Scheme and the Seed Capital Scheme for the years 2006 and 2007 is as set out in the following table:
| 2006 €m | 2007 €m | |
| Business Expansion Scheme | 21.4 | 17.5 |
| Seed Capital Scheme | 1.2 | 2.3 |
Would love to know the 07-08 figures because Labour has been saying that instead of the budget measures they would raise significant revenue through cutting the developer breaks. Been planning to do a post on labours response. But really can’t find nice laid out figures or the time.