(1) Notwithstanding any other provision of the Tax Acts, income arising to any individual as a member of the European Parliament and payable out of moneys provided -

(a) by the Oireachtas, shall be chargeable to tax under Schedule E, or

(b) by the budget of the European Union, shall be chargeable to tax under Case III of Schedule D.

(2) Any income tax liability arising in the State in respect of any such income referred to in subsection (1) shall be reduced by the amount of tax, if any, paid for the benefit of the budget of the European Union in respect of such income.