juin 29, 2022

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Call to ban Covid-19 subsidies for dividend-paying companies

Companies that took taxpayer-funded payments to deal with the pandemic and then paid dividends to their shareholders should be banned from taking advantage of more government subsidies, according to the state’s TD.

Jim O’Callaghan, Fianna Fáil TD of Dublin Bay South, made the call after The Irish Times revealed that the company that distributes Mercedes-Benz cars in Ireland received nearly €1.8 million in pandemic wage subsidies last year. It paid a similar amount in cash dividends, also last year, to an offshore company controlled by the family that owns the business.

O’Flaherty Holdings, which is owned by the O’Flaherty family through MML Holdings, posted an operating profit of nearly €10 million in 2020. It paid dividends to Hailstone Holdings, a company registered in the Isle of Man.

A company spokesperson noted that it was a coincidence that taxpayer benefit and dividend payments were nearly identical. He was unable to provide a statement from the company after a request for comment to CEO Paddy Finnegan regarding the appropriateness of accepting taxpayer money while sending dividends to the Isle of Man.

pay chart

Last year, Mr. O’Callaghan asked Finance Minister Paschal Donohue if companies in the state’s leading Employment Wage Support System were barred from paying dividends. Mr. Donohoe responded that « he has been advised by Revenue that the question of dividends which the company may or may not be in a position to pay to shareholders . . . is outside the scope of the ‘Scheme’. »