Corporate taxes help offset dismal Revenue returns

TAX revenues plummeted further than expected but the amount citizens owe to the Revenue Commissioners is stabilising.

The commissioners’ annual report showed how corporate taxes continued to shore up an otherwise dismal income stream for the state, which remains at 2003 levels.

In terms of policing evaders, the report said a focus on cash trading in taxies, building sites, pubs and shops was stepped up throughout 2010 and the commissioners warned its probing of these sectors will continue this year.

Revenue carried out 11,008 audits which resulted in an extra €434.7 million being channelled to the exchequer. A softer system of double checks brought in €58m.

A probe of 300 bankers and directors in the six main banks and building societies found €1.3m in unpaid taxes. Investigations in relation to 20 individual bankers are still ongoing.

Another inquiry into funds hived off into offshore structures found €36.6m in unpaid taxes, with 165 taxpayers to blame.

This section of its policing focused on those who transferred their assets to trusts established overseas in order to take shelter from the Irish tax net.

Other headlines from its report revealed how the commissioners decided to take a more compassionate approach to those who make a genuine attempt to pay their debts.

Sheriffs enforced 32,964 tax bills, a drop on 2009. This brought in €173m out of a total of €529m which was due. In the previous 12 months €214m was recouped when €697m was owed.

Ten properties were sold at the insistence of Revenue. And six individuals were declared bankrupt by the High Court directly arising from a petition from Revenue.

However, they began a ruthless new phase against tax dodgers as its officers experimented with new powers to act on information supplied to NAMA, the Private Rental Tenancies Board and the Taxi Regulator.

The anti-avoidance unit also probed deals involving 26 people which appeared aimed at skipping €110m in Capital Gains tax.

Overall, the commissioners brought in €1.36 billion less in tax in 2010 than a year earlier. This was marginally above what was estimated in the budget because of better-than-expected corporation tax returns — €784m above the target.

The amount raised through income tax was €264m less than envisaged and more than €55m below the previous year’s haul. The PAYE segment of this collapsed by €183m from the target set for 2010.

The income from stamp duty (€962m) was less than expected and is now just 26% of what it was in 2006.

In the area of customs and excise, a special blitz of ports, mail sorting offices, shops and markets found 15 million cigarettes and 370kgs of tobacco.

Cigarettes accounted for 97% of the value of all contraband uncovered by customs officials. Out of €77m duty-due goods nabbed, beer, wine and spirits contributed just €600,000 to the total.

Inspectors also uncovered zappers, a tool used by shopkeepers to re-set tills and lower their takings, which have since been outlawed.

At the other end of the scale, Revenue revealed it was working closely with the state’s ‘bad bank’ NAMA to see how more than 100 properties on its books were originally financed.

Receiverships

* THE amount of receiverships rocketed by 95% to 375 and 30 people were declared bankrupt — an increase of 11 on 2009.

* 63 companies wound up, compared with 39 in 2009.

* 46 companies were put into examinership.

* Sheriffs enforced 32,964 tax bills and brought in €173m out of a total of €529m which was due. In the previous 12 months €214m was recouped when €697m was owed.

* More than €60m was raised from 2,226 checks in the construction industry.

* Investigation into 328 white collar professionals yielded €9.4m.

* Checks on cash businesses including restaurants, pubs, nightclubs and motor trade raised more than €28m.

* Inquiries into approximately 300 directors and executive level employees in the six main financial institutions also raised €1.3m.

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