THE movie industry and working couples with young children will be among the major beneficiaries of today's Finance Bill.
Property developers, on the other hand, will be targeted in measures aimed at clamping down on tax avoidance.
In a major boost to the film industry, the limit on the size of the cost of films which can qualify for tax relief under BES schemes will be more than doubled. The move, which will allow tax relief on films with budgets of up to £15 million, could attract some Hollywood major players back to Ireland.
One of the first successes is likely to be Steven Spielberg's next movie, Saving Private Ryan. The second World War escape movie was due to be filmed exclusively in Britain, but it is now understood that it will be filmed partly in Wexford this summer.
The film, starring Tom Hanks and Irish-American actor Edward Burns, will be produced by Spielberg's company, Dreamworks SKG.
The new BES will also allow further tax relief for film producers who use Ireland for post-production work. This is seen as a major incentive to film-makers who frequently finish Irish-made movies in the US or Britain.
The authorities hope the new measures, which were pushed through by the Minister for Arts, Culture and the Gaeltacht, Mr Michael D. Higgins, will bring substantial new film investment here.
The announcement that Mr Spielberg will film in Ireland will be a major boost for the tourism industry. His films including ET, Raiders of the Lost Ark, Jurassic Park and Schindler's List.
Meanwhile, working couples with young children will benefit from the formal removal of VAT from creches. The Minister for Finance, Mr Quinn, has found a way to allow creches to opt out of the VAT system on the grounds of public service, education or health.
As a result the threatened imposition of 21 per cent VAT on child-minding services will be averted. The Revenue Commissioners had begun implementing a 1977 EU directive which levied VAT on child-minding services with a turnover of more than £20,000 a year.
The Bill will also include anti-avoidance measures on tax, and property developers will be targeted with a crackdown on VAT avoidance loopholes. The Revenue is losing substantial amounts through developers leasing back properties and avoiding VAT.
The measures will also affect many of the financial institutions in the IFSC, although the moves will have to wait for a formal EU derogation on common VAT rules.
The Finance Bill will also enact the tax changes announced on Budget day. The one percentage point cut in the standard rate of tax, as well as the cuts in PRSI and the widening of the tax bands, will all be formally enacted, to come into effect at the beginning of the new tax year next month.