Agreement due on EU blacklist of tax havens

Agreement on an EU blacklist of worldwide tax havens is expected to be finalised in the coming weeks as governments and finance authorities step up the monitoring of offshore account users.

The Revenue Commissioners have agreed now to examine revelations from leaked documents in the Paradise Papers on investments by wealthy individuals and institutions.

Two Irish banks were forced to defend helping clients avoid tax and disclosure by moving money offshore into tax havens. AIB and Bank of Ireland say they have now closed the operations.

More Irish-linked news about tax avoidance is expected to be released this week and authorities are now on standby to go after outstanding liabilities.

The papers involved the leaking of 13m documents to media, according to the International Consortium of Investigative Journalists.

Offshore dealings detailed included the estate of Britain’s Queen Elizabeth, the US Cabinet and giant global firms Apple and Nike. The papers also allege Bono used a company to invest in a Lithuanian shopping centre and AIB and Bank of Ireland helped people avoid tax.

Finance Minister Paschal Donohoe spoke to Revenue chairman Niall Cody yesterday about the disclosures. Mr Donohoe said agreement on a blacklist of global tax avoidance locations should be decided by EU members next month.

Currently, EU members have different definitions of tax havens and while they share information a blacklist could see locations penalised. Speaking in Brussels, Mr Donohoe said Ireland was co-operating with others on tackling tax avoidance.

“I expect that agreement will be reached on that programme of countries in December,” he said. “More broadly, Ireland is and will play its role in the practice that is needed to deal with the issue of aggressive avoidance of tax. We believe that everybody who is a company or individual should pay their tax fairly.”

Revenue said one of its dedicated units had recouped €1bn in recent years from offshore accounts.

“Our approach to tackling offshore evasion has been adopted by the OECD as best practice and has been adopted by other tax authorities,” said a spokesperson.

Irish cases emerging through the Paradise Papers will be monitored, Revenue said.

“Where the circumstances of the case warrant it, Revenue’s intervention will include the possibility of investigation and potential prosecution,” said the spokesperson. “Where appropriate, Revenue will also share information under existing legal frameworks with other relevant tax administrations.”

However, the opposition wants answers from AIB. Fianna Fáil finance spokesman Michael McGrath said: “AIB also need to clarify whether they actively shifted data to offshore jurisdictions in order to prevent t Revenue from accessing it.

“The Government, too, have questions to answer. The minister needs to clarify if or when he, or his or predecessor, became aware of such operations and what if anything was done by the Government, as majority shareholder, to shut down the operations.”

AIB said it wound down two operations in 2013 and “complies fully within the law in any jurisdiction we operate in”. Bank of Ireland said it adhered to tax laws.

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