The Dáil technical group, of which Independent TD Mick Wallace is a member, has released a statement this evening following the revelation that the Wexford TD under-paid VAT over a two-year period resulting in a €2.1 million settlement with the Revenue Commissioners.
Signed by nine members, the statement said they wanted to make it clear that they "do not condone his behaviour" and said that they believe "he has done wrong and that he should be equally accountable as any other TD or ordinary Irish citizen."
The statement was signed by Finian McGrath, Shane Ross, Catherine Murphy, Ming Luke Flanagan, Thomas Pringle, Tom Fleming, Mattie McGrath, Maureen O’Sullivan and Stephen Donnelly. Deputy John Halligan is currently out of the country and could not be contacted for comment, the statement said.
Mr Wallace's settlement, which arises from the failure of MJ Wallace Ltd to make full tax returns on apartment sales in 2008 and 2009, will be published on the Revenue's next quarterly list of tax defaulters next week.
The Wexford TD believes that none of the money will be paid to Revenue because his company is insolvent and he is not personally liable. He admits to having knowingly made a false VAT declaration to Revenue but says he did so in order to save his company and expected to be able to pay the money due at a later date.
Speaking earlier this evening, Mr Wallace said he declared he owed Revenue €1.4m and the banks €40m ahead of his election to the Dáil last year.
"We under-declared the VAT in order to buy time because I was convinced that within six and twelve months that I would be able to pay it," he told RTE news.
"It goes without saying that I don't feel good about it but the idea that I am a serial tax defaulter, I think, is unfair. For 22 years I've done everything correct."
"It wouldn't be the first time that a business would have been struggling to pay a bill – it was the first time mine was."
"I paid over €15m in tax from 2000 on. I reached a point where I just was not able to pay it. If I was able to pay it I would have paid it, and, I under declared the VAT in an effort so that I could get to a point where I could pay it."
"It is one issue in my life that I am not proud of, I am very disappointed with it but I don't think it defines me as a person or a businessman," he added.
A Revenue settlement is the final, agreed sum but does not imply payment has been made.
Earlier today, Fine Gael parliamentary party chairman Charlie Flanagan called on Mr Wallace to clarify his position. He said the fact that Mr Wallace was unlikely to ever pay the bill "raises serious questions about Deputy Wallace’s suitability to serve as an Oireachtas member".
"It sets an alarming precedent when a member of the House admits to having knowingly filed an inaccurate VAT return," Mr Flanagan said. "The idea that his company – of which he is the only director – is insolvent, but that he himself remains tax compliant, is playing ducks and drakes with the conventions of Leinster House."
Labour Party TD for Dublin South Central Eric Byrne said the Dáil technical group, of which Mr Wallace is a member, has questions to answer.
"I always found it curious that the likes of Joan Collins, Clare Daly, Joe Higgins and Richard Boyd Barrett thought nothing of cosying up to a property developer in the Dail, but the fact that Deputy Wallace is now a self-confessed tax cheat must give them real cause to shift uncomfortably in their seats," he said.
He said members of the Group have taken "every opportunity" in the Dáil to rail against the idea that the taxpayers should be forced to pay the gambling debts of bankers and developers. "It is hard to take their criticism seriously when some of those very debts emanate from one of their own members," Mr Byrne said.
Under the agreement with Revenue, MJ Wallace was found to have underdeclared VAT liabilities on returns by €1,418,894. Interest came to €289,146 and penalties amounting to €425,668 were imposed, giving a total of €2,133,708.
Speaking to The Irish Times yesterday, Mr Wallace said he had decided it was better to come forward with news of the settlement rather than have it come to light as part of the overall list of defaulters. "I'm going to get hammered anyway. This kind of thing is happening to builders every day of the week but I'm different because I'm in the Dáil." What he did was wrong but he wasn't in a position to undo it now, he said.
Mr Wallace has also revealed that ACC Bank threatened to bankrupt him several times in the past year over unpaid debts. "It's one of the options they're considering."
Last November, the bank secured a €19.4 million judgment against MJ Wallace and a receiver was appointed over the company's assets.
Under law, any TD who is declared bankrupt is required to resign his or her Dáil seat. Mr Wallace says he would fight any such move by the bank. "I didn't fight the €19.4 million settlement but I would fight bankruptcy," he said.
A Revenue spokeswoman said where an individual or company failed to pay, normal enforcement procedures applied, ranging from sheriff enforcement to liquidation.
Although MJ Wallace Ltd does not have a tax clearance certificate, Mr Wallace said he himself did. "Mick Wallace is completely tax compliant," he said.
Asked whether he was a fit person to sit in the Dáil following the settlement agreed with Revenue last February, Mr Wallace pointed out that his businesses had paid €15 million in tax and were completely tax-compliant from 2000 up until his problems arose in 2008/09.
"Who's fit to be a public representative? Let he who is without sin cast the first stone. I tried to be as honest as I could."