It is reasonable to ask that this amendment be inserted. The Income-Tax Commission was set up in response to a widespread demand for a revision of the income-tax code. It is generally accepted that the code as at present working is complex and in many respects archaic. To a very considerable extent it is adopted, as in the case of earlier Acts, merely by continuing statutes which were in operation prior to the establishment of the State.
Whatever may be said in respect of the earlier years, because a number of other matters had to be attended to, there was probably quite a good reason for adopting and continuing British statutes. Now, after the passage of 36 years, we still continue in many cases to adopt some of the worst features of the British tax code and we do not incorporate in Finance Acts here some of the many improvements that have taken place there.
One of the extraordinary situations that has developed is that some of the Acts that have been amended or repealed in Britain continue here. It is possible in some cases that they are not enforced. Nevertheless, they are still on the Statute Book and have legislative effect if they are applied. Undoubtedly, because of the complex nature of the problem, a commission was the only method of dealing with it.
In many ways, income-tax is an unfair tax. Views have been expressed from time to time that it should be abolished. I do not think that is a view that, on examination, could be sustained as sound. The main difficulty is to provide an alternative tax which would yield equivalent revenue and at the same time not be even more unfair or press more harshly than the present income-tax code does.
It was for these reasons, among others, that the commission was set up. On a number of occasions, requests were made in this House to introduce desirable changes. In recent times, these requests have always been refused on the ground that the Income-Tax Commission was sitting and that, pending its report, any change could not or should not be made. One change advocated in many quarters is the introduction of the P.A.Y.E. system. Whether or not that is desirable in the circumstances of this country is a matter on which the commission will express a viewpoint. Industrial workers, persons whose incomes can readily be ascertained in advance, would probably welcome it. It is for that reason that it is peculiarly applicable to British conditions.
In this country, we have a large number of self-employed people and a very large number of people who derive their livelihood from agriculture. In their case it is not obvious—certainly at first glance—how the P.A.Y.E. system could work. That is one of the matters which the commission is examining. Up to the present, any question of introducing that system here has been refused on the ground that it is being examined by the commission. Therefore, it is a surprise to a great many people and, indeed, a fact that is in strange contrast with the various claims that have been put forward recently that we are granting tax reliefs, that we are providing incentives of all kinds, to induce industrialists, particularly foreign industrialists or foreign technicians, to come in here and establish industry.
While that is being done we introduce Part IV of this Bill, which adds considerably to the already very drastic and comprehensive powers the revenue authorities had and gives them still greater powers, in anticipation of the report of this commission and in conflict with, and in sharp contrast to the policy that has been accepted generally as desirable by all sides of the House in the case of legislation promoted in recent years dealing with allowances for industrialists to export, and the recent measure, whether it achieves anything or not, which was designed to encourage external investment in industry here.
In those circumstances, and because of the general tendency to grant whatever facilities are possible to provide incentives, it is regrettable to enact these very drastic powers, which have not been shown to be necessary and which will add considerably to the expenses of the business community and will involve further problems, further additional administrative expenses which will cause unnecessary work. It is obvious from the various Acts at present in force that the revenue authorities have already adequate powers to deal with the problem; and it is both undesirable and unnecessary that this measure should be enacted with Section 4 as at present framed.
In those circumstances this amendment requests the commission to consider Part IV of the Bill and to make an interim report to the Minister, who shall submit it to Dáil Éireann, and that three months after that report is submitted this section of the Bill should come into operation. That appears to anyone a reasonable request. There is no justification for these drastic powers, and there is certainly no justification for them in advance of the report of this Income-Tax Commission. Is it contended that the authorities feel that this commission will suggest that some amendments should be made, and that they are jumping the gun in order to take advantage of the present measure before the commission reports? The income-tax code is very complicated. It is quite likely that one of the recommendations of the commission will be that the law should be modified and a more simple code should be adopted. While it is an accepted legal maxim that ignorantia legis haud exousat, nevertheless it is only fair and reasonable that this House should not enact further legislation which will make the existing complex code even more complicated, and it is for that reason that I believe this amendment is reasonable.
