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8 1995

FINANCE ACT, 1995

PART IV

Stamp Duties

Levy on banks.

142. —(1) In this section—

assessable amount” means the amount shown as the assessable amount in the statement delivered to the Revenue Commissioners pursuant to section 89 of the Finance Act, 1991 ;

bank” means a person who, on the 1st day of September, 1990, was the holder of a licence granted under section 9 of the Central Bank Act, 1971 , or the successors or assigns of such person.

(2) A bank shall deliver to the Revenue Commissioners, not later than the 12th day of September in each of the years 1995 and 1996, a statement in writing showing the assessable amount for that bank.

(3) (a) There shall be charged on the statement delivered not later than the 12th day of September, 1995, pursuant to subsection (2) a stamp duty of an amount equal to two-thirds of the sum of the following:

(i) 0.26 per cent. of that part of the assessable amount shown therein that does not exceed £135,000,000, and

(ii) 03865 per cent. of that part of the assessable amount shown therein that exceeds £135,000,000:

Provided that in the case where the assessable amount shown in the statement does not exceed £135,000,000 stamp duty of an amount equal to two-thirds of 0.26 per cent. of the assessable amount shown therein shall be charged.

(b) There shall be charged on the statement delivered not later than the 12th day of September, 1996, pursuant to subsection (2) a stamp duty of an amount equal to one-third of the sum of the following:

(i) 0.26 per cent. of that part of the assessable amount shown therein that does not exceed £135,000,000, and

(ii) 0.3865 per cent. of that part of the assessable amount shown therein that exceeds £135,000,000:

Provided that in the case where the assessable amount shown in the statement does not exceed £135,000,000 stamp duty of an amount equal to one-third of 0.26 per cent. of the assessable amount shown therein shall be charged.

(4) The duty charged by subsection (3) upon a statement delivered by a bank pursuant to subsection (2) shall be paid by the bank upon delivery of the statement.

(5) There shall be furnished to the Revenue Commissioners by a bank such particulars as they may deem necessary in relation to any statement required by this section to be delivered by the bank.

(6) In the case of failure by a bank to deliver any statement required by subsection (2) within the time provided for in that subsection or of failure to pay the duty chargeable on any such statement on the delivery thereof, the bank shall, from the date of the passing of this Act until the day on which the duty is paid, be liable to pay, by way of penalty, in addition to the duty, interest thereon at the rate of 15 per cent. per annum and also from the 12th day of September in each of the years 1995 and 1996, as the case may be, by way of further penalty, a sum equal to 1 per cent. of the duty for each day the duty remains unpaid and each penalty shall be recoverable in the same manner as if the penalty were part of the duty.

(7) The delivery of any statement required by subsection (2) may be enforced by the Revenue Commissioners under section 47 of the Succession Duty Act, 1853, in all respects as if such statement were such account as is mentioned in that section and the failure to deliver such statement were such default as is mentioned in that section.

(8) Except as provided for in section 45 of the Finance Act, 1992 , the stamp duty charged by this section shall not be allowed as a deduction for the purposes of the computation of any tax or duty (being tax or duty under the care and management of the Revenue Commissioners) payable by the bank.

(9) Where a company, which was a bank on the 1st day of September, 1990, and which was or is a member of a group within the meaning of section 45 of the Finance Act, 1992 , ceases to be a bank, any stamp duty payable by such company by virtue of subsection (4) and which remains unpaid shall be payable by any other bank which is a member of the group, in the same manner as if it was part of the liability of such bank:

Provided that where there is more than one bank in the group, each such bank shall be liable to pay a portion of such unpaid duty which shall be an amount which bears to the unpaid duty the same proportion as the liability of each bank in the group bears to the total liability of the group, but excluding, in the case of each such liability, such unpaid duty.

Amendment of section 19 (conveyance or transfer on sale— limit on stamp duty in the case of certain transactions between bodies corporate) of Finance Act, 1952.

143. —(1) Section 19 of the Finance Act, 1952 , is hereby amended—

(a) by the substitution of the following subsection for subsection (1) (inserted by the Finance Act, 1982 ):

“(1) Stamp duty shall not be chargeable under or by reference to the headings ‘CONVEYANCE or TRANSFER on sale of any stocks or marketable securities’ (inserted by the Finance Act, 1992 ) or ‘CONVEYANCE or TRANSFER on sale of a policy of insurance or a policy of life insurance where the risk to which the policy relates is located in the State’ (inserted by the Finance Act, 1992 ) or ‘CONVEYANCE or TRANSFER on sale of any property other than stocks or marketable securities or a policy of insurance or a policy of life insurance’ (as amended by the Finance Act, 1992 ) in the First Schedule to the Stamp Act, 1891, on any instrument to which this section applies:

Provided that that instrument has, in accordance with the provisions of section 12 of the Stamp Act, 1891, been stamped with a particular stamp denoting that it is not chargeable with any duty or that it is duly stamped.”,

(b) by the deletion of subsection (4), and

(c) by the substitution of the following subsection for subsection (6):

“(6) If—

(a) where any claim for exemption from duty under this section has been allowed, it is subsequently found that any declaration or other evidence furnished in support of the claim was untrue in any material particular, or

(b) the transferor and transferee cease to be associated within the meaning of subsection (2) of this section within a period of two years from the date of the conveyance or transfer,

then the exemption shall be deemed not to have been allowed, and an amount equal to the duty remitted shall forthwith be a debt due from the transferor and transferee jointly and severally to the Minister for Finance for the benefit of the Central Fund and be payable to the Revenue Commissioners and the said amount shall be recoverable in any court of competent jurisdiction and subsection (2) (inserted by the Finance Act, 1979) of section 69 of the Finance Act, 1973 , shall apply as if the duty was the stamp duty referred to in that subsection and the date of the conveyance was a date one month after the date of the transaction referred to in that subsection, and with any other necessary modifications.”.

(2) This section shall have effect with respect to instruments executed on or after the 8th day of February, 1995.

Relief from stamp duty in case of reconstructions or amalgamations of companies.

144. —(1) Section 31 of the Finance Act, 1965 , is hereby amended—

(a) by the insertion after subsection (1) of the following subsection:

“(1A) This section shall not apply unless the scheme of reconstruction or amalgamation is effected for bona fide commercial reasons and does not form part of a scheme or arrangement of which the main purpose, or one of the main purposes, is avoidance of liability to stamp duty, income tax, corporation tax, capital gains tax or capital acquisitions tax.”,

(b) by the insertion after subsection (7) of the following subsection:

“(7A) For the removal of doubt it is hereby declared that references in this section to ‘transferee company’ are references only to a company with limited liability.”.

(2) Notwithstanding anything to the contrary in section 31 of the Finance Act, 1965 , that section shall apply where—

(a) the transferee company or particular existing company referred to in that section is a company which is incorporated in another Member State of the European Union and which corresponds, under the laws of that Member State, to a transferee company or particular existing company within the meaning of that section, and

(b) subject to any necessary modifications for the purpose of so corresponding, all the other provisions of that section are met.

(3) Section 70 of the Finance Act, 1989 , and section 117 of the Finance Act, 1990 , are hereby repealed.

Amendment of Chapter II (stamp duty on capital companies) of Part IV of Finance Act, 1973.

145. —Chapter II of Part IV of the Finance Act, 1973 , is hereby amended by the insertion of the following section after section 67B (inserted by section 110 of the Finance Act, 1991 ):

“Further restriction of application (Chapter II).

67C.—(1) This Chapter shall not apply to any investment limited partnership within the meaning of section 3 of the Investment Limited Partnerships Act, 1994 .

(2) This section shall have effect on or after the 12th day of April, 1995.”.

Amendment of section 92 (levy on certain premiums of insurance) of Finance Act, 1982.

146. Section 92 of the Finance Act, 1982 , is hereby amended in subsection (1)—

(a) by the substitution of “policies of insurance to the extent that the risks to which those policies relate are located in the State (being risks deemed to be located in the State by virtue of section 208 of the Finance Act, 1992 )” for “business carried on by the insurer in the State on or after the 1st day of August, 1982” in the definition of “assessable amount”, and

(b) by the insertion of the following paragraph after paragraph (c) of the definition of “excluded amount”:

“(d) a premium received in respect of health insurance business (being health insurance business within the meaning of section 2 of the Health Insurance Act, 1994 );”.

Amendment of section 208 (location of insurance risk for stamp duty purposes) of Finance Act, 1992.

147. Section 208 of the Finance Act, 1992 , is hereby amended by the substitution of the following paragraph for paragraph (d):

“(d) in any other case, if the policyholder has his or her habitual residence in the State, or where the policyholder is a legal person other than an individual, if the policyholder's establishment (being an establishment within the meaning set out in Article 4 (1) of the European Communities (Non-Life Insurance) (Amendment) (No. 2) Regulations, 1991 (S.I. No. 142 of 1991)) to which the policy relates is situated in the State.”.

Amendment of section 106 (exemption from stamp duty of certain loan capital and securities) of Finance Act, 1993.

148. Section 106 of the Finance Act, 1993 (as amended by section 106 of the Finance Act, 1994 ), is hereby amended in subsection (2)—

(a) by the deletion of “the transfer of loan capital of a company or other body corporate”,

(b) by the substitution in paragraph (a) of “the transfer of loan capital of a company or other body corporate which” for “loan capital which”,

(c) by the deletion of subparagraph (i) of paragraph (a),

(d) by the substitution of the following subparagraph for subparagraph (ii) of paragraph (a):

“(ii) does not carry a right of conversion into stocks or marketable securities (other than loan capital) of a company having a register in the State or into loan capital having such a right,”,

and

(e) by the insertion of “the issue or transfer of” before “securities issued by a qualifying company” in paragraph (b).

Amendment of section 107 (particulars to be delivered in cases of transfers and leases) of Finance Act, 1994.

149. Section 107 of the Finance Act, 1994 , is hereby amended—

(a) in subsections (1) and (3), by the substitution of “transferee or lessee” for “transferor or lessor”, and

(b) in subsection (6)—

(i) by the deletion of “‘transferor’, ‘lessor’,”, and

(ii) by the insertion of “, and references to a ‘transferee’ or a ‘lessee’ include the personal representatives of any transferee or lessee” after “Finance (1909-10) Act, 1910”.

Stock borrowing.

150. —(1) In this section—

equivalent stock” means stock of an identical type, nominal value, description and amount as was so obtained from the lender or where, since the date of the stock borrowing, such stock has been paid or has been converted, subdivided, consolidated, redeemed, made the subject of a takeover, call on partly paid stock, capitalisation issue, rights issue, distribution or other similar event, then “equivalent stock” means—

(a) in the case of conversion, subdivision or consolidation, the stock into which the borrowed stock has been converted, subdivided or consolidated,

(b) in the case of redemption, a sum of money equivalent to the proceeds of the redemption,

(c) in the case of takeover, a sum of money or stock, being the consideration or alternative consideration which the lender has directed the stock borrower to accept,

(d) in the case of a call on partly paid stock, the paid-up stock:

Provided that the lender shall have paid to the stock borrower the sum due,

(e) in the case of a capitalisation issue, the borrowed stock together with the stock allotted by way of a bonus thereon,

(f) in the case of a rights issue, the borrowed stock together with the stock allotted thereon, which the lender has directed the borrower to take up:

Provided that the lender shall have paid to the stock borrower all and any sum due in respect thereof,

(g) in the event that a distribution is made in respect of the borrowed stock in the form of stock or a certificate which may at a future date be exchanged for stock or where an option is exercised to take a distribution in the form of stock or a certificate which may at a future date be exchanged for stock, the borrowed stock together with stock or a certificate equivalent to those allotted, and

(h) in the case of any event similar to any of the foregoing, the borrowed stock together with or replaced by a sum of money or stock equivalent to that received in respect of such borrowed stock resulting from such events;

stock” means stock quoted on a recognised stock exchange;

stock borrower” means a broker or dealer who is a member of the Irish unit of the International Stock Exchange of the United Kingdom and Republic of Ireland Limited, or who is a member of the limited company incorporated or to be incorporated in the State to operate as the Irish Stock Exchange, and is recognised by the committee of that unit or the Irish Stock Exchange as carrying on the business of a broker or dealer;

stock borrowing” means a transaction in which a stock borrower—

(a) for the sole purpose of completing a contract for the sale of stock entered into by the said stock borrower in the course of that borrower's business as a broker or dealer obtains from a person (in this section referred to as “the lender”) stock of the kind required for that purpose, and

(b) gives an undertaking to provide to the lender, not later than three months after the date on which the said stock borrower obtained the stock referred to in paragraph (a), equivalent stock;

stock return”, in relation to a stock borrowing, means a transaction or transactions in which, in respect of such stock borrowing, the undertaking referred to in paragraph (b) of the definition of “stock borrowing” is carried out within the period referred to in that paragraph.

(2) Stamp duty shall not be chargeable on a stock borrowing or on a stock return.

(3) If and to the extent that the stock borrower does not return or cause to be returned to the lender before the expiration of the period of three months from the date of the stock borrowing equivalent stock the stock borrower shall pay to the Revenue Commissioners within 14 days after the expiration of that period the amount of ad valorem duty which would have been chargeable on the stock so obtained if this section had not been enacted and if any stock borrower fails to duly pay any sum which that borrower is liable to pay under the provisions of this subsection, that sum, together with interest thereon at the rate of 1.25 per cent. per month or part of a month from the first day after the expiration of the said period of three months to the date of payment of that sum and, by way of further penalty, a sum equal to 1 per cent. of the duty for each day the duty remains unpaid, shall be recoverable from the stock borrower as a debt due to the Minister for Finance for the benefit of the Central Fund.

(4) Every stock borrower shall maintain separate records of each stock borrowing and any stock return made in respect of that stock borrowing and such records shall include, in respect of each stock borrowing, the following:

(a) evidence that the stock borrower was obliged to supply stock to complete a trade;

(b) the name and address of the lender;

(c) the type, nominal value, description and amount of stock borrowed from the lender;

(d) the date on which the stock was transferred from the lender to the stock borrower;

(e) the date on which equivalent stock should be returned to the lender;

(f) the type, nominal value, description and amount of the stock returned to the lender and the date of the stock return;

(g) where the provisions of paragraph (a), (b), (c), (d), (e), (f), (g) or (h) of the definition of “equivalent stock” in subsection (1) apply, full details thereof.