Exemptions from dividend withholding tax are to be extended in this year’s Finance Bill as part of a wide-ranging series of changes to the administration of the tax.
The Minister for Finance, Charlie McCreevy, announced on January 21st that non-resident companies which are wholly-owned by quoted companies will be added to the list of exempt entities. At present, these include companies resident in EU and tax treaty partner countries, Irish resident companies, pension funds, charities, collective investment funds and trustees of employee share ownership trusts.
The Minister first signalled that he was open to change on the controversial tax in an interview in Finance Dublin last October.
The Finance Bill 2000 will include a series of amendments to the much-criticised dividend withholding tax introduced last year to make the administration of the tax easier, according to the Minister.
The Department of Finance expects the yield from dividend withholding tax in the year to 5 April 2000 to be IR?50 million, compared to the estimate of IR?15 million made at Budget 1999. The changes to the administration and rules for DWT are intended to be revenue-neutral and ‘without risk to the effectiveness of policing measures’.
Following criticism of the tax, the Revenue have consulted ‘market operators, Irish company registrars, stockbrokers and custodian banks, both here and overseas’ on the operation of the system. |
