Revenue tightens net on tax cheats

THERE will be no hiding place or amnesty schemes for tax cheats, the head of the Revenue Commissioners warned yesterday.

Specialist teams working on investigations into bogus non-resident accounts, Ansbacher cases and Moriarty and Flood Tribunal-related cases will not let up, said chairman Frank Daly.

"Major tax scams have to be cleared up and clear them up we will, no matter how long it takes," he said.

"I get concerned when I hear or read suggestions that people should continue to hold out and not co-operate with Revenue in these investigations. These are unwise they are putting about the myth that either Revenue will give up or that there will be another incentive scheme with special terms.

"Neither will happen. Either would be a betrayal of the majority of taxpayers who pay their fair share, a betrayal of the businesses who are entitled to a level playing field, a betrayal of the citizens for whom tax revenue provides basic services, and a huge blow to Revenue's own credibility as an organisation," he told a Waterford Chamber of Commerce business breakfast gathering yesterday morning.

Encouraging people to hold out was irresponsible because the consequences were serious, he said.

"It is adding to their interest bill, it is adding to the penalties they will pay and it is increasing the possibility that they will face prosecution.

"Apart from cleaning up these legacy tax scams, a no-holds-barred approach to evasion also means uncovering any other evasion that is there now and preventing any happening in the future. I am not naive enough to think that evasion won't always be with us but I am confident enough to believe that we can severely limit it."

That confidence, said Mr Daly, comes not just from the very good results in Revenue's normal ongoing audit programme, but also from three particularly significant developments. They include greater powers to access financial records within Ireland.

Also important to Revenue have been developments on the exchange of information on the international scene and the organisation's major restructuring.

"To a certain extent the greater powers at home and the developments on the international scene are complementary because, when combined, they begin to close off the hiding places for money or funds on which tax has not been paid and such hiding places are essential to successful large-scale tax evasion.

"At home, since the Finance Act of 1999, Revenue has extensive access through using High Court orders to the records of banks, building societies and other financial institutions. We have used these to great effect in some of the major investigations.

"We can also expect that in the near future there will be far greater exchanges of information between the Central Bank, Financial Institutions and Revenue when the Financial Services Regulatory Bill (due before the Oireachtas shortly) becomes law."

Developments at EU and OECD level will inevitably lead to far greater mutual assistance between tax administrations and far greater routine exchange of information, including details of accounts in financial institutions, he said.

The net is already tightening, he said.

Revenue has already had discussions with its counterparts in the Isle of Man, Guernsey, Jersey and the Cayman Islands, and is confident that these will lead to successful negotiation of Tax Information Exchange Agreements.

"These agreements will not only facilitate exchange of bank information, but will also provide access to information about the beneficial ownership of companies and trusts.

"The net effect of these developments access by Revenue to financial records at home and abroad will be fewer hiding places for monies on which tax has been evaded."