The Special Assignee Relief Programme (SARP) was introduced in Finance Act 2012. The aim of the programme is to reduce the cost to employers of assigning skilled individuals in their companies from abroad to take up positions in their Irish based operations.
The Minister for Finance and Public Expenditure and Reform, Paschal Donohoe, T.D., announced today (Thursday) that he proposes to bring forward amendments to the operation of the programme at Report Stage of Finance Bill 2018 in the coming weeks.
The Revenue Commissioners prepare an annual analysis of SARP. The 2016 report (published today) notes that the cost of SARP has risen significantly to €18.1 million in 2016 from €9.5 million in 2015 and €5.9 million in 2014. The increase in cost is related to the removal of the cap of €500,000 in eligible income in Finance Act 2015 and a substantial growth in very high earners availing of the relief.
Speaking today, Minister Donohoe said,
“In light of the information on the tax expenditure costs of the programme set out in the report, I propose to bring forward at Dáil Report Stage of the Finance Bill, amendments to s. 825C of the Taxes Consolidation Act 1997 to place a ceiling on eligible income for SARP recipients at €1m. This change would be effective for new entrants to the programme from 1 January 2019 and for existing beneficiaries of the programme from 1 January 2020.”
The Programme will be subject to a full review in 2019 in accordance with the Department of Finance Tax Expenditure Guidelines. The review will look at all aspects of the programme, including its effectiveness in creating employment and assisting business expansion.