Businesses will be encouraged to buy energy-efficient equipment under a new scheme that will allow the purchase costs to be written off against tax, the Minister for Finance Brian Cowen said today.
Tanaiste and Minister for Finance Brian Cowen TD announcing the Finance Bill 2008 at Government Buildings in Dublin this afternoon. Photograph: Brenda Fitzsimons/Irish Times.
Mr Cowen made the announcement at the publication of the Finance Bill 2008 at Government Buildings in Dublin this afternoon. The Bill gives effect to Budget measures announced and includes a number of additional proposals.
One of these will see additional taxes of between 5 and 15 per cent applied to profits from oil and gas exploration, giving effect to the Government decision last year to change the taxation of this activity.
The Minister said the new taxes would be in addition to the 25 per cent corporation tax rate applied to the profits from such activities, giving an effective tax rate of between 25 and 40 per cent on profitable oil and gas fields, based on the ratio of earnings to capital costs from a particular drilling operation. He also confirmed that the VAT rate on condoms will fall from 21 per cent to 13.5 per cent.
Another new measure will see the introduction of an new online stamp duty system - to be known as e-stamping - which will allow the user to file, pay and receive an instant stamp without the Revenue needing to see the deed in most cases. Mr Cowen said he hoped this system could be introduced in the second half of next year.
To counteract smuggling, the Bill also provides for a member of the Revenue to question suspects in Garda custody. Mr Cowen said he was extending powers in this area to support the work of the Revenue in tackling criminal gangs.
In a move designed to encourage domestic tourism Mr Cowen said that capital allowances at the rate of 4 per cent over 25 years would apply to expenditure on buildings and structures in caravan packs and camping sites registered with Fáilte Ireland.
Minister for Finance Brian Cowen
Mr Cowen said this measure was to help this sector of the tourist market and encourage more Irish people to holiday at home.
Mr Cowen said the measures outlined in the Finance Bill would "encourage economic growth" while promoting care for the environment and protecting the less well off in society.
"This is the fifth Finance Bill that I have introduced to the House. In the previous Bills I have been able to introduce measures that supported business and that make the tax system fairer and significantly lighten the burden on low and middle income earners.
"In this Bill I will continue with this approach while also seeking to promote care for our environment through a range of initiatives I announced in the Budget," he said.
Among the Budget measures given effect by the Finance Bill is a revised VRT system based on emissions which will be applied to all new cars sold from July 1 st. It replaces the current system, which is based on engine size.
Under this new system there will be seven VRT bands ranging from 14 per cent for cars with emissions of less than 120 grammes of CO2 per kilometre to 36 per cent for cars emitting more than 226g/km.
At the launch of the Budget Mr Cown said he expected this change to be largely revenue neutral.