Vol. 422 No. 4
103 Mr. V. Brady asked the Minister for Finance if he has satisfied himself that all the necessary steps are being taken by his Department and the Revenue Commissioners to combat tax evasion particularly in the area of VAT; and if new VAT measures will be put in place for trade between Northern Ireland and this State when customs barriers are removed.
I have been advised that the Revenue Commissioners are making specific arrangements to combat tax evasion opportunities which might otherwise arise in the context of the Single Market. Measures to combat tax evasion are kept under continuous review and there has been a significant deployment of Revenue resources in recent years into areas directly concerned with combating evasion and other forms of non-compliance with the tax code.
In so far as VAT is concerned, this year's Finance Act introduced a comprehensive package of measures to counter certain types of fraud and abuse which had arisen and to limit the scope for tax evasion both under the present VAT regime and particularly following the abolition of fiscal frontiers as part of the Single Market on 1 January 1993.
Key elements in this package of measures are: the new VAT monthly control statement, to reduce the incidence of tax evasion involving the use of multiple accounts; the new VAT Information Exchange System, to ensure that traders' details of their intra-Community trade can be recorded and rapidly checked and monitored by the tax authorities here and in other member states of the EC; the new requirements for certain traders to provide security either as a condition of receiving a refund of VAT or as a condition of supplying goods or services where the Revenue Commissioners consider that there is a particular risk of fraud, evasion or loss of tax; the introduction of new penalties, and the increase of existing penalties in line with inflation, in respect of non-compliance with various requirements of the VAT Act; the treatment of an agent as being responsible for the VAT affairs of a non-resident trader and the VAT search, seizure and arrest powers, which retain existing Customs and Excise powers in so far as they relate to VAT on intra-Community trade and which tackle fraud and tax evasion. I must stress that a number of these measures flow directly from the requirement to incorporate provisions of EC law in national legislation.
