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DUBLIN, June 18 (Reuters) - Ireland plans to increase themarginal tax rate on oil and gas production in its unprovenwaters to up to 55 percent from 40 percent, the country's energyminister said on Wednesday.
Hopes that oil production could generate revenue for adebt-laden government, as well as a path towards energyindependence, grew in 2012 after Irish explorer ProvidenceResources reported the first commercially viableoil-flow rate at its first drilling target, Barryroe.
But ill-fated past projects and the fact Ireland does notyet have a major commercial field prompted a relatively lenientapproach towards tax on the industry, comprising a 25 percentcorporation tax rate and a "resource rent tax" of between zeroand 15 percent of profits.
Energy minister Pat Rabbitte said the government would adoptrecommendations made in an independent review for the marginaltax take on a producing field, made up of both corporation andproduction tax, to be increased to a maximum of 55 percent forthe most profitable fields under new licences.
"We have to attract outside investment and this fiscalregime is judged to be such that it ought not to deter outsideinvestment and at the same time, if we do have a find, the stateshould get a larger return on that producing field," Rabbittetold national broadcaster RTE.
Rabbitte launched the review last year after an Irishparliamentary committee recommended the rate for future licencesbe increased to a minimum of 40 percent and a Norway-style 80percent for larger projects.
He said the new regime would not be retrospectively appliedto existing licences, but would be in place for a new licensinground for 2015 which his department is launching on Wednesday.
Providence won three of the 13 licences up for grabs in thelast round in 2011, while Petrel Resources and EuropaOil & Gas were given two each. Fastnet Oil & Gas has also secured licences in Ireland. (Reporting by Padraic Halpin; Editing by David Holmes)
