A major new energy efficiency scheme is to be included in the Finance Bill when it is published tomorrow, The Irish Timeshas learned.
The new measure will allow companies to write off the full cost of replacing old plants with new equipment which is more efficient and saves energy.
No estimates of cost have been set aside for the measure. This is because the Government is unsure of the level of take-up for the new scheme, although it is certain to run into millions of euro.
In addition, while the exchequer will bear a cost in terms of tax foregone, in the long run the use of more efficient equipment is expected to lead to substantial savings, particularly in reducing the carbon burden of Ireland's Kyoto commitments.
The scheme is one of several "green" measures to feature in the Bill, which will also give statutory effect to many Budget measures, including the changes announced to vehicle registration tax (VRT). Another initiative will be the introduction of a complex mechanism to allow carbon credits to be traded as commodities in Irish financial markets.
There is also a range of business-friendly measures, including new thresholds for corporation tax and provisions to reduce administrative costs and red tape for businesses, as well as an adjustment to the VAT registration threshold.
One such measure will facilitate Irish companies wishing to repatriate profits from overseas subsidiaries. New provisions will allow them to do this more tax-efficiently. The mechanism is designed to reduce red tape.
The liability for paying tax is transferred from the subsidiary to the holding company, leading to a smoother and more simplified system. Government sources said yesterday that the new measures included since Budget time did not amount to a departure from established practice.
It is also likely that further measures or changes will be introduced at the committee stage of the Bill.
