Trustees concerned about having to sell part of Dunnes to pay tax

THE value of Dunnes Stores for tax purposes rose from £82m to £220m within three years during the late 1980s, the Moriarty Tribunal heard yesterday.

A former tax adviser to the supermarket chain told the inquiry that Dunnes Stores trustees were very concerned in 1985 that they would be forced to sell part of the group to meet their tax liabilities because of the value placed on the company by the tax authorities.

The tribunal is investigating the circumstances behind a meeting between the chairman of the Revenue Commissioners Séamus Paircéir and supermarket tycoon Ben Dunne in 1987 held at the request of then Taoiseach Charles Haughey.

A tax bill issued to the Dunnes Stores trustees was reduced from an initial sum of £38.8m to just £16m following a protracted period of negotiations which involved Mr Paircéir. The Revenue chairman also waived £62,450 off a bill issued to Dunnes Stores in 1987.

Mr Haughey received about £1.9m from Mr Dunne between 1987 and 1993. Liam Horgan told the tribunal he had no knowledge of any discussions between Mr Dunne and Mr Paircéir about the company’s tax affairs. He only became aware of the matter when contacted by the tribunal’s legal team. However, he knew Mr Paircéir personally and believed the Revenue chairman was “very open-minded” about meeting people to discuss their tax matters.

“Mr Paircéir felt it was his obligation to see taxpayers with genuine problems,” said Mr Horgan. The witness said he knew no reason why the Revenue chairman had waived the sum of £62,450 off a Dunnes Stores tax bill.

Revenue inspector Seán Ó Catháin said he did not think there was anything untoward in Mr Paircéir meetings with Mr Dunne.