Revenue inquiries yield €1.56bn for Exchequer

Investigations by the Revenue Commissioners into tax-avoidance issues have resulted in €1.56 billion being paid to the Exchequer to date, according to the Comptroller and Auditor General (C&AG).

In a report issued today, the State's financial watchdog said the money was generated following investigations into Anbacher account holders, DIRT issues, National Irish Bank and tax avoidance uncovered in the tribunals.

In his annual report for 2003, Mr John Purcell outlined that follow-up investigation has taken place into the operation of DIRT at an (unnamed) financial institution from 1986/7 to 2003 resulting in a new DIRT audit between November 2003 and July 22nd, 2004.

This investigation yielded €3.2 million in DIRT, interest and penalties.

Mr Purcell said that 46 liability reviews relating to the 2001 Voluntary Disclose and Pay Scheme remain under investigation. However, he said that more than 3,750 taxpayers who availed of the scheme have paid €232 million.

More than 177,000 inquiry letters have been sent to offshore account holders identified between October 2002 and January 2004. As of July this year this strand of the Revenue's investigations has yielded  €305 million for the Exchequer.

With regard to Ansbacher account holders the C&AG report notes there are 289 cases being dealt with; 179 on the High Court Inspectors' report and 110 cases discovered by the Revenue.

Eighty-four of these cases have been settled with 46 resulting in liabilities of €27 million. A further €16 million has been received from 41 of the 205 ongoing cases.

Forty-three cases of suspected tax evasion are also being investigated as a result of the investigations by the Moriarty and Mahon tribunal. Two cases have been settled for €6.3 million and payments on account to the value of €19 million has been received in connection with 14 cases.

Mr Purcell said the Revenue Commissioners now plans to seek High Court orders to identify those remaining Irish residents with assets offshore who are not tax compliant. Some 15,000 notices to make a disclosure were received by a March 2004 deadline, after financial institutions were informed of the Revenue's investigation into the issue.

He noted that the Revenue Commissioners has set itself "challenging targets" with regard to recovering unpaid tax. The Revenue wants all debt on record to be less than six years old or subject to court proceedings.

The report notes that as of March 31st, 2004 there was €1.36 billion tax outstanding of which the C&AG expects 80 per cent to be collected. More than 185,950, or 92 per cent of the income tax cases related to sums below  €1,000 and only 20 cases related to outstanding income tax payments of  over €1 million.

Mr Purcell said the focus on cases involving over €20,000  coupled with the lack of collection activity noted in eight sampled cases with arrears under €8,000 raises the question as to how the large number of cases (99.5 per cent of 201,000 cases) under €20,000 can be dealt with within six years.

Mr Purcell also notes there are inconsistencies with the quality and maintenance of records on the Revenue's computer records system.