Tax double standards

BY ROBBIE SMYTH

What a week for the Revenue Commissioners. A new report by business consultants KPMG suggests that billions of euro were being siphoned out of the Irish economy, perhaps fraudulently, during the late 1990s, facilitated by the very same banks who were forced to pay over €600 million in DIRT arrears for similar tax fraud.

KPMG have found that in just two of the boom years of the 1990s, €4 billion was sucked out of the Irish economy into bank accounts in the Isle of Man subsidiary branches of six Irish banks.

Last week, one of those banks, Irish Permanent and Life, wrote to its 3,000 Isle of Man customers to tell them that the Revenue Commissioners are to set to begin an inquiry into the accounts on 17 November.

Earlier this year, Bank of Ireland wrote in a similar fashion to customers in its Jersey subsidiaries telling them that a Revenue Commission inquiry would be examining its offshore accounts. Now, 254 account holders who were avoiding tax have had to pay €100 million to the Revenue Commissioners.

There are clearly hundreds of millions of euro being siphoned out of our economy that should be being collected as tax revenue. It has taken the Revenue Commissioners an awful long time to act decisively to get this money.

Maybe it is because they are busy dealing with other taxpayers. Last week, new Revenue Commissioner guidelines were published for what types of workplace benefit in kind will be liable in 2004.

The proposed changes will negatively affect thousands of PAYE workers, as a range of new rules are introduced, including tax on private use of company vans, health insurance, childcare subsidies and even lunch vouchers.

It is good to see the fat cats being finally brought to account. It doesn't make sense to penalise the ordinary worker when so many loopholes are still open to the wealthy super rich, who can open offshore accounts or become tax exiles.