Financial services profits up for first time in six years

Profits at international financial services firms grew in 2013 for the first time in six years, according to figures obtained from the Revenue Commissioners.

Corporation tax payments from former IFSC and international financial services companies rose by 9 per cent to reach €497 million in 2013, representing the first year that tax revenues have risen since 2006.

Based on a tax rate of 12.5 per cent, this would correlate with profits of almost €4 billion.

Tax revenues reached a peak of €1.1 billion in 2006, but have been in decline since, with a notable fall-off in 2011 due to the fact that companies formerly covered in the report are no longer separately identifiable due to restructuring of these companies.

IFSC tax revenues now contribute just 12 per cent of total corporation tax revenues, down from about 16 per cent in 2009.

Change underway
Change is also underway in the IFSC Clearing House Group, whose membership is made up of senior figures from the financial services industry and senior officers from Government departments and State agencies.

A new sub-group, the Strategic Group, is set to meet this month for the first time.

The group’s aim will be to consider “the challenges and opportunities for the international financial services sector in Ireland and how the Clearing House Group might contribute to addressing these”.

Chairman
It is chaired by Martin Fraser, secretary general at the Department of the Taoiseach, who also chairs the overall Clearing House Group.

The new group, which has eight members, will meet twice a year.

In addition to setting the strategic objectives for the Clearing House Group, it will also prepare an annual report outlining the group’s progress.