Wednesday, 14 November 2001
Dáil Eireann Debate
168. Mr. McDowell asked the Minister for Finance the tax changes sought by a company (details supplied) in order to facilitate its takeover of a company; the person who contacted him or his Department in relation to the matter; if he has been told that the completion of the takeover is contingent on such specified amendments to the Taxes Acts being made; if the changes sought have been agreed to by him and the Government; if so, if legislation will be required; if he is legally bound to introduce such legislation; if so, if the State will receive any consideration for facilitating the deal; if the changes are particular to this takeover or will apply to ESOTs generally; his plans to release all relevant background information relating to the proposed changes; and if he will make a statement on the matter. [28154/01]
The actual position is that the taxation advisers to the relevant employee share ownership trust – ESOT – sought clarification about how the existing legislation governing the tax treatment of ESOTs would apply in the event of a takeover of the relevant company being successful. The advice which I received from the Revenue Commissioners and my Department was that if a particular bid were successful, an amendment to the ESOT legislation would be required if the tax benefits currently provided to members of the ESOT were to be maintained. Having considered the matter, I indicated that I was prepared to propose an amendment to the relevant legislation in the context of the Finance Bill, 2002. The changes that I intend to bring forward will be designed to maintain the existing tax benefits that can accrue to the relevant ESOT. It will not provide any additional tax benefits. I should mention that such changes will also apply to any other ESOT that is in a similar unforeseen situation and will not change the essential principles of the scheme.
As the Deputy will be aware, as a result of representations from trades unions and others, I have made amendments to the tax legislation governing ESOTs on a number of occasions to facilitate ESOTs in changing circumstances to ensure they retain the tax benefits available to them.
My Department has received a number of requests under the Freedom of Information Act, 1997, on this matter. I understand that the deciding officer decided that all of the relevant documents should be released apart from those which are still part of the deliberative process. However, this decision is now the subject of an appeal by an interested party to the Information Commissioner and no documents can be released until the appeal has been finalised.
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