Falling trend in DIRT payments

DIRT payments from all the financial institutions fell in 1991, the year AIB said the Revenue had an industry-wide initiative on bogus non-resident accounts. The chief executive of AIB, Mr Tom Mulcahy, told the Dail Committee of Public Accounts on Thursday that the Revenue approach to his bank in 1991, which led to procedural changes and an "uplift" in DIRT receipts, was part of an "industry- wide" initiative. He said that state banks had been involved.

However in 1991 DIRT receipts, which had totalled £270.7 million in 1990, fell to £261.3 million. In 1992 the figure fell again, to £254.6 million. The amounts are end-of-year figures given by the Revenue Commissioners.

AIB DIRT payments increased by £8.7 million in the year to April 5th 1991. The bank's DIRT payments went from £49.9 million the previous year, to £58.6 million. In the year to April 5th 1992, AIB's DIRT payment increased by a further £4.9 million, to £63.5 million.

The size of the DIRT payment in any year is dictated by a number of factors including tax and interest rates and the amount of money in the accounts affected. Mr Mulcahy said on Thursday that the increases in their figures in 1991 and 1992 were due to a number of factors but could not say what percentage of the increase was due to the reclassification of bogus non-resident accounts.

A spokesman for Bank of Ireland said there was no change in the bank's procedures in relation to non-resident accounts in the early 1990s. He would not comment on whether the bank had been approached by the Revenue at the time.

"Bank of Ireland does not believe it has any liability to unpaid taxes arising from the non-resident account issue," he said. "No general settlement with the Revenue Commissioners ever arose, nor would it have been relevant. Payment was made in relation to individual localised incidents both by the bank and by the customers concerned." He would not say in what year these payments had been made. No deal on DIRT had ever been sought or received.

National Irish Bank was asked if they had been approached by the Revenue in the early 1990s, but had not responded by last night.

Ms Eileen Fitzgerald, marketing manager with ACC Bank, said the bank had been approached by the Revenue "around that time" and asked about their practices and procedures in relation to non-resident accounts.

"They were quite satisfied and there were no changes introduced." The question of a settlement did not arise and there was therefore no discussion about DIRT arrears.

A spokesman for TSB said the bank never had to make a general DIRT settlement or additional payment to the Revenue. He said he did not believe they were approached by the Revenue in 1991.

ICC Bank, in a statement, said deposits from individuals represented a small part of the bank's overall funding. It has always been the policy of the bank to ensure non-resident accounts comply fully with the law, according to the statement.

A spokeswoman for the Department of Finance said the department had not been aware of the 1991 Revenue initiative on bogus non-resident accounts.

On Thursday the governor of the Central Bank, Mr Maurice O'Connell, said the bank had been told by AIB - in October 1990 - that it was working with Revenue on an in-depth investigation into non-resident accounts which would lead to an increase in the bank's DIRT payments. No other bank had told the Central Bank it was involved in such an exercise at the time, he said.

On Tuesday the chairman of the Revenue Commissioners, Mr Dermot Quigley, told the public accounts committee that the Revenue "initiated discussions with the main financial institutions to ensure that the non-resident account situation was regularised by review by the institutions of all the declarations". The 1991 discussions with AIB were part of this exercise.