17 May - Irish Stock Exchange welcomes end to stamp duty on investing in Irish companies on ESM
- Reduces the cost of investing in Irish ESM companies
- Puts Irish companies on a level playing field with UK and international peers for attracting investment
- Makes public markets more accessible for SME companies when raising finance
17 May 2017
The ISE welcomes today’s announcement by the Minister for Finance, Michael Noonan TD, to end stamp duty on the purchase of shares in Irish companies listed on the ISE’s Enterprise Securities Market (ESM). The exemption from 1% stamp duty comes into effect from 5 June and will reduce the cost for pension funds and individuals of investing in Irish growth companies.
The measure should make public equity markets more accessible for companies when raising finance and will enable Irish SMEs to scale more easily, creating jobs and growth in the Irish economy.
The announcement ensures Irish companies quoted on the ISE’s ESM, a market designed for companies in their earlier stages of growth, are on a level playing field with their international peers in the UK and other countries when competing for Irish and international investment.
The ISE continues to campaign for the abolition of stamp duty for Irish companies listed on the ISE’s Main Securities Market (MSM) and welcomed the Minister’s commitment in last year’s Budget to undertake a review of Ireland’s stamp duty regime in 2017 as part of Government’s response to Brexit.
ISE Chief Executive Deirdre Somers said:
“This is great news for Ireland and Irish companies looking to raise equity finance on the Enterprise Securities Market. Fundamentally this is about making it easier for Irish businesses to scale up and the Minister deserves every credit for recognising that this measure will benefit Irish companies looking to attract much-needed Irish and international investment and create a better environment for expansion, job creation and growth in Ireland.
We are confident that the benefits for the Irish economy of eliminating stamp duty on investing in ESM companies will become clear very quickly and we hope that the Government’s wider review of the stamp duty regime will result in the measure being extended to all Irish-quoted companies, making it easier for them to access finance and scale their business.”
Notes to Editors
- EU and other studies show that stamp duty makes it much harder for companies and entrepreneurs to attract investment. The findings also indicate that this type of transaction tax:
- increases the cost of capital for companies
- has a negative impact on the economy
- damages liquidity in the shares of affected companies.
2. The UK exempted UK companies on growth markets such as AIM from stamp duty in April 2015. The UK applies stamp duty at a rate of 0.5% on UK companies listed on other markets. France has a financial transaction tax (FTT) applied at a rate of 0.3% to companies but exempts companies with a market capitalisation of €1bn. Italy applies FTT at 0.12% but exempts companies with a market capitalisation of €500m. There are no other comparable regimes in the EU.