The Revenue Commissioners have seized 54 imported midrange vehicles which were converted to passenger use after the owners had registered them as commercial and paid a lower rate of vehicle registration tax (VRT).
The new investigation, which started earlier this year, has resulted in 11 files being sent to the Director of Public Prosecutions.
Charges against 40 other car owners are currently under consideration by the Revenue. To date this investigation has also yielded €1.1 million in VRT payments and a further €300,000 in VAT.
All those charged to date are car owners. This statewide investigation follows the success of Revenue's Operation Viking which last year saw the seizure of 160 imported luxury vehicles which were registered in Ireland for commercial use for VRT and VAT purposes before being converted for passenger use.
A senior Revenue source said that as a result of Operation Viking, five garages had paid fines and penalties totaling €850,000 and files on three more garage operators had been referred to the Criminal Assets Bureau. An audit on a sixth garage is ongoing.
Almost all of these garages are described as "stand alone" businesses. The Revenue has not released the names of the business or individuals who have made settlements. The Revenue source added that the DPP was also taking a prosecution against a north Dublin individual connected with the scam. This individual is understood to have imported a significant number of the vehicles seized under Operation Viking.
All 160 vehicles seized have now been returned to their owners following payment of taxes and fines and the operation was wound down at the end of 2006. In the Revenue's Annual Report for 2006, published yesterday, it said almost €1.5 million in outstanding VAT and VRT had been made in relation to just 60 of these luxury cars. The final settlement is not yet known. Revenue officials believe that the scheme was organised by the garage owners.
"Because of the close-knit community involved in purchasing these cars, we were convinced from quite early on that this was a scheme organised by the owners and suppliers. We are convinced the garages were facilitating them," the senior Revenue official said.
He said that as details of the scam were passed to all Revenue regions, car owners quickly heard about the investigation and the scam stopped. It was discovered after Revenue officials in Dublin Port noticed the importation of large numbers of high value cars with foreign registrations.
Operation Viking has also prompted an investigation by Revenue into the wider business interests of a number of the car owners involved. "Using 'wholecase management', we would see attempted evasion of one particular tax or duty as an indication of other potential tax compliance issues," the Revenue official said.
As a result, Revenue officials have investigated a group of taxpayers and their companies who came to light during Operation Viking. "This led to amajor investigation which will result in a significant yield. The settlement will be well over €1 million and is nearly complete," he said
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