These operations have swallowed up some €300bn in Irish assets...
There was no indication from Finance Minister Michael Noonan last night that the government’s confirmation it will move to close off a controversial tax loophole, used by some so-called vulture property funds, will be retroactive.
The Minister has published a proposed amendment to Section 110 of the Finance Act 1997, originally designed for funds management and administration companies based in the IFSC but with no substantial assets in Ireland, to minimise their tax liabilities here.
It’s emerged recently that many of the Irish subsidiaries of overseas funds that have acquired distressed Irish property assets have been using Section 110 to reduce tax to just hundreds of euro on multi-million asset portfolios
It’s likely the measure will only cover future tax liabilities as otherwise the Government could be accused of its own criticism of the European Commission in the Apple case, of trying to re-write controversial but legal tax arrangements.
"A number of concerns have been raised recently about the possible use of aggressive tax practices by some section 110 companies to avoid paying tax on Irish property transactions,” Mr Noonan said.
"In light of these concerns, and due to the highly technical and complex nature of the amendment, I am now publishing a proposed amendment to section 110," the minister continued.