Consultants are being sought by the Revenue Commissioners to investigate apparent abuses of tax relief available to film investors which has resulted in a loss to the Exchequer of €23 million.
The inquiry follows concerns raised by a number of film companies during Oireacthas hearings about abuses of the system which they claimed was undermining the industry.
According to new figures published in the Irish Examiner newspaper today, €4.5 million has been recovered following agreement with a number of investors and that a number of others under investigations are being pursued through the courts.
Section 481 of the Taxes Consolidation Act offers tax relief to investors in film. This relief was extended in Budget 2004 until December 31st, 2008, subject to approval from the European Commission.
In the Budget the criteria for the relief was relaxed and the condition that at least 75 per cent of the production work on a film must be carried out within the State before tax relief is applicable has been removed in the Finance Bill.
A minimum of 10 per cent of the production work on a film now has to be carried out in the Republic for a film to qualify for the relief.
The Revenue Commissioners hope that the consultants will advise as to sections within the Budget that could be changed to close loopholes allowing abuses of tax relief for films.