Irish Arts Minister supports artists' tax breaks

KILLARNEY - Ireland's Arts Minister said on Friday scrapping a tax break that has attracted many struggling writers and musicians to the country's shores could drive artists abroad.

The scheme, in place since 1969 and unique to Ireland, is among a raft of tax incentives being reviewed by the finance ministry ahead of December's budget. Critics say the shelter unfairly helps high earners like rock group U2 get richer.

"It is my firm belief that elimination of the exemption would inevitably and significantly reduce the level of professional arts activity in the state," John O'Donoghue said in the text of a speech for a political party conference.

"I also believe strongly that capping this exemption would send out a message internationally that we do not encourage success in the arts ... We will force our young talent to go abroad as soon as they become successful. This is wrong."

The most recent winner of the MAN Booker Prize was Irishman John Banville and many well-known foreign writers have made their home in Ireland to avail of the tax shelter.

These include Scottish novelist Irvine Welsh, millionaire author of "Trainspotting", and, in the early days of the scheme, thriller writer Frederick Forsyth, famous for "Day of the Jackal" and "The Odessa File".

Top local beneficiaries of the exemption, which applies exclusively to income derived from "creative and original" work, include singer Van Morrison, boy band Westlife, Riverdance impresario Bill Whelan, and film director Neil Jordan.

Critics of the scheme are angry that such successful, wealthy artists are being given tax breaks, and point out half the income involved is earned by 2 per cent of the artists.

The Irish Arts Council, which is calling for the scheme's retention, counters that struggling artists are the biggest beneficiaries. The bottom 50 per cent of those who availed of it in 2001 earned an average 5,200 euros.

"We are a small nation, but our artistic reputation is great," said O'Donoghue, Minister for Arts, Sports and Tourism.

"The list of successful writers, poets, artists, and composers is long ... As a country it is our duty to protect and nourish our artistic talent, not punish it for achieving success,"

In 2001, the last year for which figures are available, 1,300 artists claimed relief on earnings totalling around 106 million euros, at a cost to the Irish exchequer of 37 million euros.

- REUTERS