AIB and the Department of Finance disagree on what occurred during a 1987 meeting on the regulation of non-resident accounts, the Public Accounts Committee DIRT hearing was told yesterday.
The meeting was held between the Irish Bankers Federation and Department officials, including the Minister for Finance, Mr Ray MacSharry, in May 1987.
Among the participants were the late Mr Niall Crowley, chairman of AIB, and Prof Louden Ryan, governor of the Bank of Ireland.
Mr Michael Tutty, an assistant secretary general at the Department of Finance who was also present at the meeting, gave evidence that his record of the meeting differed from the AIB version and that he did not know "until a few days ago what they based their particular assurances on".
Mr MacSharry had said, according to Mr Tutty, that he was sympathetic to the banks which had to administer a new declaration of non-residence. The Revenue Commissioners had the power to inspect declarations. The minister had said, according to Mr Tutty, that he would examine the issue before the following year's budget but was unable to make any changes at present.
According to the AIB briefing note, Mr MacSharry gave assurances that the forms which non-resident account applicants had to fill out would not be inspected by the Revenue Commissioners, although provision to do so was included the 1986 Finance Act, when DIRT was introduced, and was due to come into effect in 1987.
AIB's impression of the meeting's proceedings were based on a note of a briefing which followed it. According to the note, Mr MacSharry had said "inspectability will not be an issue at any time and provision will be made in 1988 Finance Act to cater for this". Mr Tutty said he had no recollection of anybody supporting that assurance.
The IBF report was certainly closer to his own report, Mr Tutty said, and the IBF had not been aware of the AIB note. The IBF, in its pre-budget submission later that year, had not claimed that the minister had agreed to change the legislation.
Earlier, Mr Paddy Mullarkey, the secretary general of the Department of Finance, said his Department had no role in a change made to the form which non-resident account applicants had to fill in. The change, which removed the requirement for a description of the account to be provided, was made in the 1997 Taxes Consolidation Act.