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Revenue to get powers to probe people’s bank accounts, says FG

By Paul O’Brien, Political Reporter
THE Government is slipping through by stealth new powers for the Revenue Commissioners to obtain detailed information about people’s bank accounts, Fine Gael warned last night.

Finance Minister Brian Cowen published the Finance Bill, which will allow for reform of the tax code, at the start of this month. Included in it are enhanced Revenue powers to tackle tax avoidance and evasion.

The proposed legislation is currently making its way through the Dáil where, in the normal process, TDs would have the opportunity to debate the measures and argue for change where felt necessary. But Fine Gael finance spokesman Richard Bruton said last night the bill was being rushed through, illustrating "once again the pathetic nature of the Dáil’s ability to scrutinise financial management."

The bill contains 122 sections. According to Mr Bruton, more than half of these "were not subjected to any Dáil scrutiny whatsoever", as 67 sections were not reached. Overall, tax changes to the value of e1bn were not scrutinised.

These included:

* The new powers for the Revenue to require financial institutions to return details of customers’ accounts.

* The extension for a limited period of certain tax reliefs for property schemes.

* New tax reliefs for private hospitals.

* The cap on the amount of tax reliefs that can be availed of by high earners.

* The incentive to place SSIAs in pension funds.

Mr Bruton stressed that Fine Gael was not opposed to the new powers for Revenue, the cap on reliefs for high earners, or many other measures in the bill. But every measure should have warranted full inspection in the Dáil. He was dismayed that Government would allow many of property reliefs to be phased out over time rather than ending them immediately. These reliefs have been lucrative for high earners who used them to reduce tax bills significantly.

Mr Cowen believes all the measures in the bill are justified, being based on "sound fiscal policies that [will] deliver value for money to the taxpayer". According to the minister, the bill will ensure that high earners can no longer reduce their tax bills to zero by restricting the amount of reliefs they can use. The SSIA initiative will encourage people to improve their retirement arrangements by transferring monies from their SSIAs into pensions. The Government is offering to add €1 for every €3 transferred in this way, subject to a maximum bonus of €2,500.

The new powers for Revenue, meanwhile, will help "tackle tax avoidance and maximise compliance". Under these powers, financial institutions will be obliged to report to Revenue interest and other profit payments made to customers.