Wish list for Finance Bill 2012 - Mazars - Ireland

The December Budget speech has been welcomed as broadly business supportive, with many in the financial services sector reflecting positively, in particular, on the Special Assignee Relief Programme. Additional announcements are expected in the Finance Bill in the areas of Funds, Corporate Treasury, international Insurance and Aircraft Leasing and we hope to see the Minister follow through on his highlighting of these sectors on Budget day.

The Irish economy is in an extremely challenging position at present.  As we proceed through the EU/IMF programme the options available to Government to provide tax relief are limited.  Accordingly, we believe that any reliefs offered need to be carefully targeted to focus on areas which offer the most advantage in terms of value to the Irish economy and which offer the most benefits in terms of additional employment.  Supporting innovation is, we believe, also an important criterion for the evaluation of where the Finance Bill may best be focused.

We would suggest that the Minister for Finance might consider some of the following options;

1. Supporting innovation - we would like to see the Minister take steps to remove the base year provisions in respect of Research and Development Expenditure. We would also like to see that the recently announced provisions allowing employees to share in Research and Development Tax Credits are implemented in a flexible manner. Finally, in this area we would like to see the Minister make provision to reduce the rate of tax applicable to royalty income.
2. We believe that the Government might consider providing additional support to the insurance sector, specifically by looking at opportunities to support the establishment of European or Global hubs in Ireland, perhaps by providing for relief in respect of certain set-up costs inherent in establishing such operations.
3. Supporting Employment - we would welcome the introduction of a tax exemption for employees with specialist skills who relocate to Ireland - this could include specialists in the Financial Services sector, as well as complementary areas such as I.T.  We would also support additional provisions to support the funds industry, where there is a clear opportunity to provide additional employment at scale.  As an example, we would be pleased to see the Minister offer incentives to investment managers locating in Ireland, and to funds investing in areas such as "green" technologies and infrastructure.

Finally, we would echo two suggestions in the CCAB-I pre-budget submission to the Minister.  We do need a serious re-consideration of Pensions policy in this country and hopefully the Finance Bill might provide first signs of Government intent in this regard.  We also support the suggestion that the High Earners Restriction be relaxed in relation to the EIS, which will serve to maximise the potential of the scheme.