Dáil Éireann debate -
Tuesday, 1 Jun 1993

Vol. 431 No. 6

Finance Bill, 1993: Report Stage.

Mr. Cox

I move amendment No. 1:

In page 11, between lines 16 and 17, to insert the following:

"1.—No arrangement, compromise or settlement in respect of any liability for income tax or income levy, shall be made, where such arrangement, compromise or settlement would amount to an arbitrary or invidious discrimination between the taxpayer or class of taxpayer and taxpayers or classes of taxpayers who have complied with their obligations in respect of such taxes."

I welcome the opportunity to raise for a period longer than five minutes the question of the tax amnesty. I am glad we are not having a recurrence of what took place on the Adjournment Debate last week. This amendment relates to a broader one which has been divided into two parts on the advice of the Bills Office. Amendment No. 174 relates also to this matter.

I regard this as part of the care and management process vested in the Revenue Commissioners in relation to the integrity of purpose and function of the tax collection system. While amendment No. 1 is confined, as recommended by the Bills Office, to income tax and the income levy, its related amendment deals with corporation tax and capital gains tax. The entire care and management process and the responsibility vested in the Revenue Commissioners is at the heart of this amnesty measure. The amnesty is a knee jerk quick fix means of raising revenue, as is the 1 per cent income levy which has been universally criticised. In a sense, this is a compound fracture in the tax breakdown of this year's budget and Finance Bill because the amnesty is explained in part, if not completely, by the desire to find a second revenue source to get the Government out of the political fix of the 1 per cent income levy which it should never have introduced.

The amnesty has more pernicious faults in respect of the integrity of the tax system than the 1 per cent levy. It is an insult to the compliant tax paying public and is unprecedented in its form as a tax amnesty. Reports would suggest that the Government intends to write off all due liabilities under the income tax Acts, corporation tax, capital acquisition taxes, capital gains tax or income levies and replace such universal write-off of liability with some penalty, as yet unspecified, but widely thought to be a flat rate tax of 15 per cent.

It is in essence a lottery style bonanza for tax cheats and it has been underwritten by the Government as a quick fix means of raising revenue. This is an extremely ill thought out measure. Up to now the Minister for Finance, out of a sense of consistency and decency, has not gone on the record in relation to this matter because he did not know which way to turn. I believe the reports are correct and that the Minister was advised not to accept this amnesty. They are correct in that the Revenue Commissioners believed that this amnesty, providing a charter for tax dodgers, would be a gross offence to those who complied with their taxation obligations over the years or even to those who complied with earlier amnesties that did not write off tax liability in the normal process. The amnesty measure is ill thought out for more than that reason.

There was nothing in the budget speech about a tax amnesty. However, ten weeks after the budget and after due reflection by the Minister, his advisers, the Revenue authorities and the Government there is no reference in the Finance Bill to the word "amnesty" or its laundered version "incentive". Even though the Minister could move item No. 5 on the Order Paper, an amendment between Committee and Report Stage to a Financial Resolution, he cannot let us know how this reprehensible proposal will proceed because he does not know. It was reported that the Cabinet would make up its mind today, as they did not do so as part of budget policy, during the debate on the Finance Bill, in the Select Committee last week or in any Resolution before the House since then. To whom will this amnesty apply? Reports are mixed in this regard. However universal its intended application may have been those who are now running scared under proper political scrutiny and the weight of public criticism and odium which this proposal has brought about will now see more limitations. In respect of what period of time and to what funds held in this country or outside will it apply? Clearly it will relate to tax cheats, dodgers and evaders, a group of people who are economic mé féiners in respect of the operation of the tax system. However, if one were to listen to the proponents of this measure and the reported remarks of the disappointed Taoiseach on his return from Malaysia — in so far as no one appeared to be interested in his trip and were more interested in this Bill — it would appear that those mé féiners, dodgers and evaders are now about to transform this land to one flowing with investment milk and honey. We will now be confronted by latter day patriots on the economic front, the greatest mé féiners in our recent economic history. I have never come across such staggering and profound naivety as to suggest to the public if they were gullible enough to swallow it — that those cheating mé féiners who evade their responsibility in law should now be transformed — at the stroke of a ministerial pen — into some form of latter day patriots and economic saints.

An Ceann Comhairle

I hesitate to interrupt the Deputy but I must advise the House that we are now on Report Stage and I must dissuade Members from making a Second Stage speech. Speeches should be relevant and have due regard to what applies on Report Stage. I have given the Deputy some latitude but I must dissuade him and other Members participating in this debate from making Second Stage speeches. I would prefer if there were relevant and succinct in accordance with the Report Stage of any Bill in this House.

Mr. Cox

I will try to respect the Chair's ruling and will be as brief as I can on an issue which cries out for comment and which finally we have found some way of raising. I will not tax your patience, Sir, but I ask for some indulgence on this matter. The Government which makes up its tax policies as it goes along failed to include on Second Stage or Committee Stage of the Finance Bill a reference to the amnesty and still continues its merry dance in respect of its proposal.

In regard to the issue of equity, exemption limits in the Finance Bill show that single people earning £70 a week or less will become liable for the full weight of taxation here and that a married person is liable for twice that amount. Under the income levy a person earning £173 a week or more will be liable for a fifth tax on work. Reports indicate that for all income held offshore or perhaps in certain accounts in Ireland and for accrued capital gains such investment will have earned during the years, a flat rate tax of 15 per cent will apply. That position flies in the face of the basic concept of social justice and tax equity in terms of the construction of our tax code. It has been argued that this makes sense in relation to interest rates and again lower them. What caused our interest rates to come down? Devaluation, which the Minister did not want. Ireland's position at the top of the band within the exchange rate mechanism, the strength of sterling and the fall in German interest rates has helped to bring interest rates down but this measure will not help. The phenomenon which I described are the foundation stones on which our interest rate reductions are founded and it is superfluous to argue that interest rates will fall as a result of this measure. Those dodgers and evaders have broken the law under the income tax Acts, the corporation tax Act, the capital gains tax Act, the three income levies and the exchange control regulations. At a stroke that evasion and law breaking is to be set to one side in favour of those mé féiners who brought about the dodging element which this Government wants to underwrite and legitimise.

The point has been made that this provision will lead to greater investment here. Is it not the case that those mé féining, self-serving, tax cheating evaders did not give a damn about the Irish economy? They took their money out of the country, they did not look for productive investment and our need was no less a few years ago than it is today. They did not care about the Irish economy. They lined their own pockets, cheated and evaded and we are now saying they will be the saving grace of our economic future. This is absolute nonsense. Is it not the case that we do not have exchange control and if this money is brought in laundered and legitimised for whatever price that it can go out again by means of a revolving door? We will now have rotating laundered money introduced with the compliments of the Labour Party instead of a rotating Taoiseach which we thought was a condition of the formation of the Government.

I wish to mention briefly a letter which a colleague received this week from a woman with a tax liability who had heard a discussion on the radio about the tax amnesty. She said that as she listened to the radio the sheriff sat in her hall preparing to remove her piano. It was only when a neighbour came and contacted her brother that she was left alone that day. She lives in a very remote place, has an old age pension as well as a very small British allowance. She said that she was forced to pay £500. She is 79 years of age and only has what it will take to bury her.

She went on then to make one or two political comments which I will not repeat. That woman had the sheriff sitting in her hall waiting to take away her piano or the small amount of money she set aside to bury her while the greatest dodgers, cheats, mé féiners and self servers in the history of the State will get away scot-free. In terms of the ethics of this issue we are quickly moving from the image of the island of saints and scholars, which we like to pride our ethical past on, as a shining beacon of light across Europe, into an island of swindlers and dodgers to be underwritten by this partnership Government.

The amendment raises one profound point which the Minister, the Government and those who support this issue must address.

In respect of all the relevant taxes that I have mentioned, the class of taxpayer who has evaded, dodged and cheated will be treated in a manner which is arbitrary and invidious in respect of the equity and the operation of the existing system if this amnesty becomes law.

An Ceann Comhairle

I am still concerned about the notion of turning a Report Stage measure into a Second Stage reading. The speeches are very comprehensive and I must insist in future that there be more relevance and brevity in relation to this matter.

Mr. M. McDowell

Why brevity?

An Ceann Comhairle

We cannot turn this debate into a Second Reading

Mr. M. McDowell

Why not? We have plenty of time.

An Ceann Comhairle

The Second Reading of this Bill has passed and I am merely asking that the normal procedure on Report Stage be adhered to. The Chair has given quite some latitude in that matter and will continue to give some latitude but we cannot turn this into a Second Reading debate.

Mr. Cox

A Cheann Comhairle, I will not tax you any further. I have two final comments. I have heard from members of the Labour Party that this measure is designed to be an alternative to the 1 per cent income levy. That was a disaster and they should never have agreed to it but this is a greater disaster in terms of its attack on the integrity of the Irish tax code. They should not agree to this as a knee-jerk response to a measure which was wrong in the first instance. Some Labour Party members talk about additional spending on health and education arising out of this measure. The Minister will know, even if some of those Members do not, that more spending will be a recurrent and perpetual feature whereas this amnesty, if it ever comes about, will be a once-off measure.

This amnesty is a dog's dinner of an invasion on the integrity of the Irish tax code and it is well worthy of its senior author at Cabinet.

Proinsias De Rossa

It is difficult to know where to begin on this issue given that we have conflicting reports as to the extent to which Cabinet supports this proposal or whether there is majority support in Cabinet for it. It was apparently adopted at the whim of the Taoiseach against the advice of the Revenue Commissioners, the Department of Finance and, one must assume, against the advice of the Minister for Finance who is present. I do not envy Minister Ahern's job today in defending a measure for which he apparently has no stomach.

It appears that the new philosophy of the Government is to tax the needy and reward the greedy. We only have to examine the record to date which includes a 1 per cent levy on relatively low incomes, tax on disability benefit — I am sure there is not a Deputy who has not received representations from constituents whose incomes have been slashed as a result of tax on disability benefit — and single individuals on an income of £70 a week. The taxing of this income drives them into deeper poverty as a result of the failure to properly reform and introduce equity into our tax system. Yet this extraordinary decision was taken to introduce a tax amnesty for people who essentially abandoned this country to its fate in the eighties and who are, in my view, economic and social traitors. They acted treacherously in the way they abandoned their responsibility to support our education and health systems. It must be remembered that in the eighties there were pleas of insufficient money to pay for our health services. Health cuts were a common feature and indeed the Taoiseach, Deputy Reynolds, will remember that it was former Deputy Haughey who on arrival home from Japan declared surprise at the furore concerning health cuts. He promptly lost the election he subsequently called due to his annoyance concerning a Private Members' motion that was passed by the Dáil.

An Ceann Comhairle

The Deputy should return to the amendment.

Proinsias De Rossa

Tax cheating is not a victimless crime and we should not have a Government which is prepared to reward people who abandoned the social services of this country. We have had debates on the need for services for those with disabilities and mental handicap. We have had debates about schools that are under-funded, under-funded capitation grants and schools that are falling down. In my constituency, Dublin NorthWest, the Holy Spirit national school in Ballymun, which Deputy Flaherty is raising on the Adjournment tonight, is literally falling down and yet there is no money to rebuild it because these tax cheats took their money out of the country.

The Government is proposing to invite them back, give them an amnesty on the tax they owe, an amnesty on any penalties they might have faced and an amnesty on the interest they might have had to pay as a result of failing to pay their fair share of tax. It is an extraordinary decision. Hundreds of thousands of PAYE workers who do not pay tax willingly — I do not think anyone pays tax willingly — are compliant and pay their fair share. In fact, I understand they pay 87 per cent of the total tax take according to recent figures. These people are being slapped in the face and insulted by this proposal to reward tax cheats.

We must not forget either the thousands of honest business people in this State who have paid their share of tax also. I would argue that some of them have not paid a fair or adequate share but certainly they have not run away from the country and abandoned the services, the poor, those in need or our health services as these tax cheats have. We have been told that something in the order of £2,000 million has been stashed away by these people. Few ordinary mortals would have £2,000 million stashed away. One wonders at what level of society these people operate or how they have accumulated these vast fortunes.

It is with some surprise that we hear the Government, at a time when everybody thought they had seen sense on this issue, announce overnight that they will introduce this tax amnesty. The surprise is multiplied by the fact that the Labour Party seems to be accepting this proposal rather meekly. We are told that they oppose it but, apparently, they did not push it to a vote in Cabinet in an effort to defeat it. We have also the extraordinary spectacle of the chairperson of the Labour Party, Deputy Kemmy, actively promoting the idea. It boggles the mind as to what the Deputy is thinking about when he argues that this State should be supported on the basis of tax cheats being rewarded.

I wish to refer to a few other points in relation to this matter. The fact that the Taoiseach expressed surprise at the row and the disbelief this proposal has generated among honest taxpayers indicates that the man lives in a different world, that he is still attached to the old Fianna Fáil cute hoorism, the idea that the country should be run by strokes and winks and nods. If that gombeen style of politics is still prevalent in the top echelons of Cabinet we have serious cause to be concerned.

This country has been rocked by scandals for the last number of years as a result of business-political involvement in various matters, some of which have been aired at tribunal level and some in various investigations by accountants and others, and I do not propose to rehash them. One would have thought that in view of that experience the current Taoiseach, whose Government lost so many seats in the last election precisely because of this style of approach to business and politics, would have learned his lesson. However, that is not the case and we now have another example of this gombeen culture, the belief that anything is justified in business and any attempt to ensure that people other than those in the PAYE sector pay their fair share of tax should be dropped and that those who do pay their fair share should be insulted and slapped in the face with this crazy notion of a tax amnesty for tax cheats.

Mr. Power

Since the Government announced its intention to bring in this amnesty the subject has recevied much comment. It is important that the Government does not create the perception that it accepts the behaviour of tax dodgers The amnesty is a recognition that, despite the best efforts of the Revenue Commissioners, people have escaped the system and a lot of money is held outside the country. Various figures have been put on the amount of money involved but that remains to be seen. The Government is not, as other speakers have said, rewarding the greedy; the amnesty is an acceptance that people have escaped the system and it is an opportunity to get money back into the country. This amnesty will reap a rich harvest for the Exchequer and will provide additional money for the needy.

The last amnesty was a tremendous success although there were a number of doubting Thomases before its introduction. I will quote a Member of this House who spoke on the matter in 1988 He said:

I particularly commend the Minister on the introduction of the amnesty. It has been the most far seeing and imaginative amnesty introduced for many years. I sincerely hope it is what the Minister wishes and that it will benefit the Exchequer. By getting this amnesty, if it works, out of the way, and with real self-assessment being rolled in following on that, we could bring the taxation system, particularly in the areas which cause concern, up to date. This would mean an effective return to the Exchequer. We would not be pretending every year that there are £600 million, £700 million or £800 million owed to taxes when most of it is assessed and notional, and does not have real relevance.

Mr. Rabbitte

I am sure the Deputy does not believe one word of that.

Mr. Power

Those words were expressed by Deputy Cullen of the Progressive Democrats at the time of the last amnesty. Today the Progressive Democrats ——

Mr. Cox

They had to pay their tax bills.

Mr. Power

The question that must be asked is who benefited from the tax amnesty and why is there a sudden change in the Progressive Democrats tune.

Mr. Cox

Because this is a cheats charter.

Mr. Power

The Progressive Democrats are consistent in their inconsistencies.

Mr. Cox

It is a cheats charter. The Government is inconsistent.

Mr. Power

Their fraudulent posturing will not fool the public.

Mr. Cox

The last time you had to pay; you did not write off your liabilities.

Mr. Power

The Progressive Democrats were very supportive of the last amnesty and time will prove this amnesty a success also.

Mr. M. Ahern

On a point of order, would you consider it immoral to print five pound notes? Perhaps Deputy De Rossa would not consider it so.

Proinsias De Rossa

I will take that as a joke. Otherwise, I would have to bring the man before the——

An Ceann Comhairle

Deputy McDowell.

Mr. M. McDowell

This amendment in the name of Deputy Cox proposes to proof our tax system against tax settlements which effectively amount to unfair discrimination as between those who are complying with the system and those who are not so complying. The proposal is designed to proof the present law against the measure which it is proposed to introduce in the near future by way of legislation. I do not understand how somebody like Deputy Power can be so blind to the realities as to see no difference between what is proposed by some members of this Government, particularly the Taoiseach, and what happened in 1987-88. What happened then, as the Deputy well knows, is that every taxpayer was told: "Pay every penny you owe and we will excuse you the penalties and the other compliance measure, which is interest".

Mr. Power

Why——

Mr. M. McDowell

The Deputy had his chance to speak. People could stand up and say about that amnesty, as it was called, that every taxpayer who availed of it paid up to date every halfpenny in tax that he or she owed. That was the principle of that amnesty and it was a principle based on fairness, justice and equity. It was based on the fact that no person was excused their legal responsibility, a principle whereby the pound paid by the poor working man who has enough pressure on his family budget by way of tax every week was no better or no worse than the pound paid by the people who availed of that amnesty. It was an amnesty available to everybody, put in place on the basis of a principle of fairness, an amnesty which shamed nobody and which brought no political, media or public condemnation. It was essentially different from the theft being sanctioned by the present Government.

The Minister for Finance, Deputy Ahern, should have at least the honour to stand up for the integrity of the tax system and the Revenue Commissioners, to abide by the advice given to him by his best advisers. He should have the honour and integrity to say that he will not be the Minister responsible for the destruction of faith that is implicit in this proposed amnesty, the destruction of faith in our institutions, politicians and our system. If he had any honour and decency, Deputy Ahern would say to the Taoiseach: "Go ahead with this amnesty, but go ahead without me". The Taoiseach's bluff can be called if a sufficient number of members of the Cabinet have the moral courage to stand up and say it is unfair and wrong. Everybody in the country knows it is wrong to say to a working class woman in Ballyfermot earning less than the average industrial wage: "Give us 48 per cent of your extra earnings in income tax and 7.5 or 8 per cent in levies of various kinds — more than half of every extra penny you earn". That is what the Minister is saying to that person, but what is he saying to the fat cat friends of the Taoiseach who are going to repatriate hundreds of millions of pounds under this system? He is saying "give me 15 per cent of the total". How abject a proposal that is.

The 15 per cent flat rate tax is shameful because it means that the longer the money is out and the more tax evaded, the better off one is. If one had the money out for 15 years one would pay 1 per cent per annum on this illegal fund held abroad. If one had it out for two years one would pay 7.5 per cent on the capital fund. The more one has cheated, the more one has abandoned the economy which the Taoiseach now claims one is supposed to help by bringing back this money, the more damage one has done, the more one has shirked his social responsibility, the more the Minister, Deputy Ahern, will give by way of reward. That is what the 15 per cent flat rate means. Nobody in the western world would consider it anything but shameful. Can the Government side show me any civilised country which has said to the people who cheat, "Give us 1 per cent per annum of your money and we will be happy", but which says to the ordinary working class girl in Ballyfermot "Give me 48 per cent or 55 per cent of your extra earnings".

How can Fianna Fáil, which is supposed to be a party representing the "have-nots" in Irish society and which trumpeted its left of centre origins recently while courting the Labour Party in order to form this iniquitous Government, stand up for that? How can the Labour Party which is supposed to be the party of workers become the party of evaders, cheaters and multi-millionaires who want to launder their cash in this country?

There is no point in the Minister sitting silently or saying that this is not his decision. This is a decision which has been pushed through the Cabinet at the behest of the Taoiseach. Phrases have been used in this House which do justice to the kind of morality which this represents. This suggestion is bankrupt in moral terms. It stinks. It damages people's faith in institutions and it tramples their sense of hope. Does anybody on that side of the House know what it is like when one cannot afford to feed one's kids and send them to school, or to pay a mortgage, to hand up more than half of every extra pound earned? Does anybody really understand what it is like for someome who is doing that week in and week out to see people who have brought their money to Jersey, to the Cayman Islands or to the Isle of Man or who have secreted it in building societies here being told that they can pay 1 per cent each year on the capital sum and that no further questions will be asked. It is a shameful proposal and it is about time that the people responsible stood up and justified it in this House.

Deputy Cox in his contribution said that the Taoiseach had in some way dignified the very people who are about to repatriate these moneys as latter day heros who are coming to our economic rescue in times of difficulty. They are no such thing. They are quislings, people who opted out and decided to take no part in the fight to get Ireland's economy back on its feet. These are the people who took the money out when Deputy Ahern's party in 1987 was making hard decisions to try to get the economy back on its feet. These people betrayed the Government and now the Government is rewarding them. The worse the betrayal, the greater the reward. It is a shameful act which should not be permitted.

The wording in Deputy Cox's amendment brings to mind the fact that this is also wrong in terms of justice. It is a measure which in the last analysis will have to be looked at by the courts. Any proposal from the State which discriminates between individuals or classes of individuals in any way must be justified by reference to what is either a difference in social function or a difference in moral capacity. That is what the Constitution says. The State, when it brings in a law cannot say that all those with red hair should pay tax at the rate of 10 per cent and all those with black hair must pay at the rate of 20 per cent. Every differentiation must be rationally based. What is the rationale for the differentation in relation to people who will be offered a 15 per cent flat rate if this amnesty is passed? The only difference is that they cheated.

Both the Minister and I know of many taxpayers who had to borrow to pay capital acquisitions tax, people who made mistakes doing that and whose livelihoods were destroyed because they over borrowed to pay tax. People who have complied with their tax obligations have been ruined by having done so. I know many families who have gone without for years while their better off neighbours apparently had access to offshore funds or building society accounts and had no moral qualms. Those families scrimped and saved to pay the taxes and the Minister is now delivering them an insult and a slap in the face of unprecedented proportions.

The point about the differentiation proposed in this revenue amnesty is that it amounts to something which the Constitution does not permit. The Constitution does not permit the State to make one person pay 40 per cent tax or 45 per cent tax and another person pay 1 per cent per annum during the period when that person kept money abroad. Because the Constitution does not permit that, the Minister will find that more and more people will queue up to impugn any such amnesty before the courts of this land. They will queue with relish in order to bring the Government to heel and force it to comply with the Constitution. Because of that, I predict that this amnesty will be an abject failure. Nobody will bring money back when there is a case before the courts, the gist of which is a claim that the amnesty is unconstitutional. Nobody will bring money back in the shadow of legal question mark over the measure the Minister has been forced to introduce by the Taoiseach against his own wishes.

Deputy Cowen had the effrontery to suggest that I was engaged in sabotage in pointing out the obvious. Nobody in their right minds would repatriate money to avail of this amnesty because it offends against every person's sense of decency and against the Constitution. The small handful of naive people who will repatriate their funds, who think that this represents justice and who think that they are safe, will find that they have been duped into bringing back money into this country in circumstances where an apparent amnesty turned out to be a puff of smoke because it infringed the basic concept of justice and the Constitution. It is not sabotage to point out the obvious about such a measure, that the State has no right to discriminate between compliant and non-compliant people so as to punish the law abiding citizen and subsidise the cheats, the frauds and the robbers who put their money aside in circumstances where they knew they were committing crimes against our system.

Deputy O'Malley asked in this House the other day a very opportune question as to how many crimes one had to commit to avail of this amnesty. He asked whether one was enough or whether there must be two. His question was prescient because it slowly emerged that the Taoiseach also has in mind that money left under false names in building society accounts, in foreign accounts, external accounts or the like will also be covered by the amnesty. That is what the Taoiseach has in mind. Somebody used the phrase that this is cute hoorism at its worst. It represents a low point in social morality and a shameful departure from any sense of fairness. People who are being hounded by Revenue sheriffs to comply with penal tax rates know that the Taoiseach's rich friends will be able to avail of a money laundering operation of unprecedented dimensions and get away with a 1 per cent levy on their hot money. How can they justify that before the bar of public opinion? They cannot. Every working man and woman who has spent the past few weeks wondering whether this could truly be Government policy must know that this Government is not on their side in this mindless pursuit of the quick fix. This Government is determined to do anything it can to get its hands on any money.

The Taoiseach said in his bad-tempered interview with the media at Dublin Airport last evening that there could be no losers in this operation. Will the Minister for Finance tell him that we are all the losers because of the damage to our tax system and our taxpayers will become more resentful. What is happening in every corner of this land every day of the week will intensify. There is virtually nowhere that employers are not being asked by employees for under-the-counter payments, £10 for expenses or whatever. There is virtually no building contractor who is not propositioned in that way by his employees. There is virtually no shopkeeper who finds it easy to pay the full whack of tax to keep his shop open on Saturday mornings and at nighttime. There is virtually no publican who can get lounge staff to work on a fully taxed basis at night.

Those are the people who will realise there is no such thing as an underlying basis of morality in our tax system. The reaction of very many people, selfemployed, employees, employers will be: "If the rich can get away with it, why should not I?" The answer they will give is: "I am a sucker, whereas they have politically influential friends". That is the only difference. A proposal emanating from Deputy Davern, which appears to have been adopted by the Taoiseach — pushed through cowardly by a totally abject Cabinet, none of whom apparently would stand up for principles in this matter — deserves to be rejected.

I might remind the House that Article 40.1 of the Constitution states:

All citizens shall, as human persons, be held equal before the law. This shall not be held to mean that the State shall not in its enactments have due regard to differences of capacity, physical and moral, and of social function.

The second clause of the Article says that the only permissible exceptions to that proposition are differentiations based on social function. There is no social function difference between a tax evader and a tax complier, or differentiation on the basis of moral capacity, but there is a huge differentiation in terms of moral capacity between those who scrimped and saved to pay the sheriff and those fat cats who kept their money abroad.

The Minister had better take on board the fact there will be litigation about this. It will be challenged in the courts. As the implications of what is proposed sink into the minds of ordinary people, and the better they are explained to the courts system when the time comes, the more obvious it will become that what the Taoiseach, Deputy Davern and a few other people who are practising this cult of cute hoor politics are actually doing offends against everybody's basic sense of decency and, above all, offends the Constitution itself. Once it becomes clear to the people on whom the Taoiseach is relying to repatriate their ill-gotten gains from abroad that they will not get away with it, that they will be challenged and harried, as they deserve to be, and that the tax inspector will keep an eye on them in the future, this amnesty will turn out to be a total failure.

I am asking the Minister for Finance to stand up, as he should do, for his Department, for the Revenue Commissioners, for the integrity of the tax system, indeed for what people in his constituency would believe is basically fair. If he and his colleagues in Government had the elementary courage to do it, they should tell the Taoiseach to go ahead but without them. If the Minister had the courage to stand up to the Taoiseach, as some in his party, including Deputy Power, stood up to a former Leader of their party, this proposal would cease to be a runner.

With the exception of one member of the Labour Party, I have not seen here since this debate began any of the people who have been prating on about ethics in Government. I do not see the Minister of State at the Department of Finance, Deputy Eithne Fitzgerald, who has been talking at great length about a new set of standards in public life. She can tear up her Bill if she votes against this amendment this evening. Every member of the Labour Party who talks in public about improving standards in public life can tear up the programme for a partnership Government and stop talking about a different approach to standards in Irish public life, if none of them will stand up to vindicate basic standards of decency. Where are they now? They are skulking in their rooms. Why are they not here listening to a debate on a matter to do with standards which really affect working class people?

Mr. Ferris

I am here and Deputy Michael McDowell will hear me too preaching morality.

Mr. M. McDowell

Where are the rest of Deputy Ferris's colleagues? Having spoken to Lablour Party Members on the matter, I know that every decent person in the Labour Party regards this as a betrayal on the part of their party of everything they stood for. Deputy Ferris knows he is betraying his voters. When they return to this House after the next election, with half the number of seats they had or fewer——

Mr. Ferris

Deputy McDowell's party has had experience of that.

Mr. M. McDowell

Yes, and I know what can happen.

Mrs. Doyle

Deputy McDowell is recommending that, if possible, the Labour Party avoid it.

An Leas-Ceann Comhairle

Will Deputy McDowell adhere to the amendment before the House?

Mr. M. McDowell

If and when Deputy Ferris's party return to this House with a smaller number of Members they will realise just how wrong they were on this measure.

I appeal to the Minister to accept this amendment, to stand up for what he believes in, to go to the Taoiseach and tell him to stop this folly before he destroys everyone's faith in the system, before he offends everyone's sense of basic fairness and justice.

Mr. Yates

I am glad to have the opportunity to put on the record my position and that of my party on this matter. Since last Wednesday morning when the Government announcement was made, I have been the focus of almost as much attention as the amnesty. This is a political tactic on the part of the Government to try to divert attention from the content of the amnesty to my decisions and amendments.

In the first instance, I wish to set out the reasons my party, on mature reflection, having considered the matter fully, will be opposing the amnesty and supporting amendment No. 1. From the outset, I saw some merit in the argument that we should try to attract foreign capital home. I accept that it is of no benefit to the economy. However, when the other arguments were put to me, I found them overpowering.

The two principle reasons we have decided to oppose the amnesty are, first, in all previous amnesties relief was provided in respect of interest and penalties, not in respect of the capital, and, second, we do not believe it is possible, having considered the matter in some detail, to draw the line at foreign funds; in other words, one could not restrict it to foreign money held abroad only; one would have to include non-resident accounts in Ireland because this represents foreign money held in Ireland. Given the ease with which someone can open a non-resident account in Ireland this would effectively mean that people with money in a biscuit tin, or under the mattress, would be able to avail of the amnesty. Those are the two considered reasons we will be opposing the amnesty. I have altered my initial view on this matter.

Reference has been made to the 1988 amnesty. I have in front of me a copy of section 72 of the 1988 Finance Act which sets out in detail the conditions attached to that amnesty. It provided that in the period 27 January 1988 to 30 September 1988 people could pay all amounts of tax due before or during that period in accordance with all previous tax Acts; that notwithstanding this, they would not have to pay relevant interest owed by them which was unpaid on the expiration of the period referred to and that proceedings would not be initiated or continued for the recovery of any fine or penalty. That amnesty was very sucessful. I do not know what comments were made by each Fine Gael speaker at that time or what may have been said by any Fine Gael speaker in past years, but since last Thursday our considered position is that we are opposed to this amnesty.

I have been taken aback, as I am sure the Government has been, by the tidal wave of emotional reaction against the amnesty by compliant taxpayers. It would be prudent and sensible for the Government to take this into account. This is a matter of political judgement but perhaps it was unforeseen. It has evoked a debate, not on best law and practice or what is in the best interests of the Exchequer, but about morality and compliance. That is the context in which this debate is taking place.

I do not see myself as being excessively moralistic. I do not care for such politics; I would rather deal with an issue on its merits or demerits, which are clear in this instance. First, if one tries to restrict the amnesty to foreign money it could lead to capital outflows to avail of it. The only thing I would say about my amendment is that under current tax law the Revenue Commissioners do not have ready access to bank accounts. The position is they have to go to the High Court but only if they have sufficient evidence to show that there is something there. If the Government persists it must consider the possibility of changing the law to provide access to bank accounts. It is unjust in relation to our tax compliance system that there is scrutiny in terms of an audit, but no access to bank accounts. I should say also that the system would be severely undermined in relation to corporation tax, VAT, PAYE and PRSI payable by the corporate sector or a sole trader. The Government will have to try to preclude this.

I am not against amnesties per se. Let me give one example. Very shortly the tax and social welfare codes will have to be integrated with the result that it will be impossible to work and sign on at the same time. It is important when it is no longer possible for a person in Tallaght or Jobstown, to whom Deputy Rabbitte often referred on Committee Stage, to clip hedges every day of the week and sign on for the dole at the same time that they take up employment rather than say to themselves that they cannot admit that they are working and signing on and that therefore they should remain on social welfare. An amnesty in that instance would be appropriate. Amnesties per se have to be considered on their merits. However, the more amnesties one has the more people will be able to budget in the expectation that there will be an amnesty with the result that the system will be undermined because people will say that every six to seven years amounts will be written off and they should hold out. To be fair to the Minister for Finance he finds himself in a difficult position on this issue. It is no secret——

Mr. Rabbitte

Does the Deputy think he might swop?

Mr. Yates

I would take his job any time.

Mr. Ellis

The Deputy will have a long wait.

Mr. Yates

It is being argued that an amnesty will lead to a reduction in interest rates and to money being brought back, but this is greatly exaggerated. When one takes into account the amount of money that is in circulation under the auspices of the Central Bank, no matter how much money will be brought in it will not have any meaningful impact. Because of the exchange controls in operation at present those who bring money in are perfectly entitled to take it out again.

I wish to summarise what my party's position is on this amnesty in the clearest possible terms. We are not opposed to all amnesties but we believe that a line should be drawn in the sand; in other words amnesties should be granted only in limited circumstances to provide relief in respect of interest payments and penalties, not in respect of the principle. Second, it would not be possible, administratively, to draw up an amnesty to provide for foreign capital only. Any capital anywhere in Europe would be made available. For those reasons we will be opposing it.

Mr. Ferris

First, I resent Deputy McDowell's comment that the Labour Party is now the party of evaders and cheats. That is an insult to my party. His final words at the end of a long speech, in which he pontificated and gave his own moral judgment, were that his recommendation to those with money outside the country would be not to bring it back because something extraordinary would happen. On the one hand, he is condemning the amnesty and on the other giving a legalistic judgment on what these people should do.

There is nothing wrong with the amendment in the name of Deputy Cox and I would apply it in the case of every taxpayer whom the Department of Finance is aware of, both inside and outside the country. It is insulting to suggest that in some way Department of Finance officials condone this activity and might have access to information. It is my experience that they use information in the appropriate manner.

After the last tax amnesty, the system of self-assessment was introduced and there were very strict penalties imposed for non-compliance. We know that people do their best to pay their tax liabilities but because of staff availability the Revenue Commissioners can conduct audits in only 2.5 per cent to 5 per cent of cases. It has been discovered that people who made legitimate profits were advised by Irish banks, tax consultants and financial houses to use various procedures both inside and outside the jurisdiction in order to escape paying further tax. Some professionals can enjoy a very high standard of living by advising clients to move surplus funds out of the jurisdiction.

A previous Government discovered that on average, approximately ten bank accounts were held per adult head of the population. People knew that if they earned more than £100 interest from any deposit account they were taxed on the remainder. This led people to open bank accounts everywhere, throughout the country, and outside the jurisdiction in the North and in Britain. Let us not talk about attracting the funds of the drug barons or the Provisional IRA, because no doubt they are involved in everything where a fast buck is to be made. There are people who made legitimate profits in the country and moved the money outside the jurisdiction because they were advised to do so. We do not have access to that money, indeed, we do not even know it is there. If anyone knows of such accounts abroad, he has a duty to inform the Revenue Commissioners because the procedure is there under the self-assessment system and persons who do not comply with the tax law can be dealt with. We have all had experience of negotiating with the Revenue Commissioners for people who discover there is a penalty for non-compliance and they want to get back into the tax net.

The case is put vehemently that people who took advantage of the last amnesty to come into the tax net have been penalised ever since. What has been happening is that they are being asked to pay the same amount of tax as everybody else. I am in sympathy with the case Deputy Rabbitte so eloquently made on Committee Stage for the PAYE sector. The PAYE sector have no facility to escape any tax, indeed, their tax is paid before they are paid and most are put to the pin of their collar to survive. It is unlikely, therefore, that they have money deposited outside the jurisdiction. Under existing legislation, the Revenue Commissioners have power to confiscate money that is held illegally so Members with information of this should inform the Revenue Commissioners.

The Labour Party members are entitled to have views on the amnesty. It was discussed at length at the parliamentary Party meeting and a great many Members expressed reservations about the idea that people could expect to escape from their normal tax liabilities——

Mr. Cox

Fair play to you, Deputy.

Mr. Ferris

If we know where this money is, we should do the proper thing and tax it.

Mr. Cox

Do not give them an amnesty.

Mr. Ferris

If we do not know about it, what do we do? Do we accept that although it is obvious there is money out there we have no legal way of getting at it because people took expert advice rather than pay their fair share of tax?

Mr. Cox

Tax dodgers.

Mr. Ferris

Perhaps the Deputy wants to call them tax dodgers. They might see themselves as engaging in tax avoidance but among the cream of Irish society are professionals engaged in that practice — they have no interest in the PAYE worker.

Mr. M. McDowell

They will be thanking you for voting for this Bill tonight.

Mr. Ferris

I suggest we bring this money back into the economy. There are things that we all want to do, indeed, Members of the Opposition ask every day for things to be done. We should see how this could be done. When I listen to Deputy McDowell, in particular, giving his opinion that a case will be brought before the High Court, let me remind him that when it was suggested that it should be made obligatory that the finance houses collect DIRT at 26 per cent on moneys invested in undisclosed accounts, the right wing screamed that we were touching unused money in the jurisdiction and we were accused of creating a situation that would drive millions of pounds out of the country.

Mr. M. McDowell

That was Fianna Fáil, it was not a Progressive Democrat Government.

Mr. Ferris

The Deputy's party was not around at that time and I do not know how long more they will be around.

Mr. Cox

This side will be around a long time.

Mr. Ferris

The DIRT has been reduced from 26 per cent to 10 per cent. Since 1 January when the Single European Act took effect there is a provision that a person can invest up to £50,000 and pay tax at a rate of 10 per cent on the interest earned. We are now suggesting that people should repatriate their money and invest it in special DIRT accounts. The Minister has confirmed that by reducing the rate of tax from 26 per cent to 10 per cent we have already attracted a great deal of money into the economy. Was there an outcry at the reduction of the rate of tax on moneys invested for non-productive purposes?

Mr. M. McDowell

Will investors be confined to investing £50,000?

Mr. Cox

We want to see equality before the law.

Mr. Ferris

If Deputy Cox has knowledge of moneys invested outside the law, the same responsibility that rests on me rests on him. There is existing legislation to deal with people who are breaking the law.

Mr. M. McDowell

The money from the Ballsbridge site is invested in Jersey under a false name and in a false account.

Mr. Ferris

There are very few PAYE workers with money in Jersey, but perhaps there may be a few barristers or legal eagles or their cronies with money in Cyprus or Jersey. I am sure there are pensioners and old people who have been thrifty and who have money in several accounts and they are now being given an incentive to move it into one account to pay tax at the interest of 10 per cent. What is wrong with that?

(Interruptions.)

Mr. Ferris

I accept that Deputy Yates has a difficulty with this but at least he had the grace to stand up and say that after mature consideration what he had advocated was wrong and his party has outvoted him and as a result he feels embarrassed. In fairness he had to do what he did, and he related that to the 10 per cent tax.

Mr. Cox

He said it was the folly of his ways.

Mr. Ferris

I listened to Deputy Noonan of Fine Gael last night when he said Deputy Yates was wrong and the Front Bench had now decided to oppose the amnesty. A few people in my constituency have said the amnesty was a reward for crime and law breaking. If it is, I would be extremely concerned.

Mrs. Doyle

It is and it is amazing that a Labour Deputy is here to defend it in the House.

Mr. Ferris

So the Deputy has some information to suggest——

Mrs. Doyle

If the Deputy was a member of Fianna Fáil I could listen to him but——

An Leas-Cheann Comhairle

Please, Deputy Doyle, you will get your opportunity; your name is written down here. Please do not interrupt the Deputy in possession.

Mr. M. McDowell

This is James Connolly's finest hour.

Mr. Ferris

I am very consistent in what I say in this House. I hate people who throw stones when they live in glasshouses.

Mr. Browne

(Carlow-Kilkenny): The Deputy will hear the glass break around himself soon.

Mr. Ferris

The Deputy could hear the silence of the glass when it did not break. Anything that has been said so far does not convince me or the PAYE worker or the person who needs health care or the social welfare recipient or the people who are penalised by having to pay the 1 per cent levy——

Mr. Cox

It convinces the electorate.

Mr. Ferris

——that any of them is represented by the views expressed here. What is really worrying these people is the number of friends they have who may have money out there. There would be an onus on them to ask such people to come home though, Deputy Michael McDowell suggests they come home "on his judgment". As he is an expert in matters of judgment I would have to value that expertise. I presume he would be recommending that some people would not bring their nomey back here on the basis that they would then be nobbled by this Government. All I am saying is that if there is money out there — I have no idea as to whether there is but apparently somebody on this side of the House has some information to support that case — and if it can be brought in here and if those who are overtaxed at present——

Mr. Cox

That is evasion.

Mr. M. McDowell

Many from the Ballsbridge side have accounts in Jersey under false names.

Mr. Ferris

——can see an opportunity of relief, then let us get that money by coaxing and by providing incentives. Those who represent the private sector say they respond to all kinds of incentives. This is an incentive for people if they want to get back into Ireland to play some part in the development of this country——

Mr. M. McDowell

And give the Government——

Mr. Cox

The mé féiners who ran away——

Mr. Ferris

Obviously the Deputies opposite do not want to listen to me. I have no problem because I can speak twice as loud if they continue to interrupt me. The economy is now in a position whereby it is attractive for people to come back here and invest their money. It is attractive for those who have special accounts to do this.

A Deputy

Why can they not pay?

Mr. Ferris

It is important that people avail of every facility within the jurisdiction to put what funds they have into the economy. There are people out there, many without jobs, who would like to think that money would be made available to do something towards providing employment. I do not see anything wrong with the amendment because it refers to existing taxation, knowledge of it and information available to the Department of Finance.

Mr. M. McDowell

Will the Deputy vote for it?

Mr. Cox

Well done.

Mr. Ferris

This infers in some way that the Department of Finance is covering up for people. That is a reflection on the officials in the Department of Finance——

Mr. Cox

It is a reflection on how you interpret plain English.

Mr. Ferris

——and on people who table amendments such as this and talk as if there was some knowledge of this money from within. I am dealing with similar matters on a daily basis in my constituency where people are put to the pin of their collar trying to come to grips with the existing penalties.

Mr. M. McDowell

They keep paying them.

Mr. Ferris

Nobody can say we did not tell you, but still one has to negotiate if one wants to remain in business and employ people. We try to reach agreement with the tax office over a period of a few years in exceptional cases but that is not always accepted. Let us be honest with ourselves and be practical about it. I do not know what sum of money is out there but it has been acquired illegally, such as by way of the proceeds of crime, drug pushing or whatever, then we already have in existence legislation to confiscate it.

Mr. Cox

It is just plain evasion.

Mr. Ferris

There are many people in Ireland guilty of plain evasion. Deputy Cox knows that as well as I do. These are ordinary people who consider that to open up three bank accounts instead of one is not a form of evasion.

Mr. Cox

But the Deputy knows the law.

Mr. Ferris

There was an average of ten accounts to every adult in this country——

Mr. Cox

What about the Ballsbridge money?

Mr. Ferris

——before the DIRT tax was introduced. DIRT was supposed to be a dirty word, but now it is popular. Eventually we will have to abolish it because we must keep in line with European Community law. I do not like people from the Progressive Democrats preaching to the Labour Party — from their chairperson downwards — or to Cabinet Ministers and presuming our views on any subject. The views we express will satisfy the members of the Parliamentary Party in consultation with their Cabinet members. That is the shock that Progressive Democrat Members and other people get when it comes to pressure like this. We do not succumb to pressure because we want to be realistic about how we approach any particular problem when we are involved in the Government to run the country.

Mr. Rabbitte

I will be brief because I want to give the Minister an opportunity to reply to what is probably the most important amendment we have had during this debate on the Finance Bill. Its purpose is to preserve the integrity of the tax system.

Mr. Cox

Hear, hear.

Mr. Rabbitte

What is at risk here is the integrity of the tax system itself. On the Order of Business today somebody referred to the fact that the figures due to be published from the Revenue Commissioners within the next few days will show that 88 per cent of the burden of paying tax in the State is borne by the PAYE sector. It was 89 per cent in 1979 when 750,000 people throughout the length and breadth of the country, from cities and towns, came out on to the streets of this country protesting about the unfairness of the tax burden being carried by them. Almost 15 years later the situation has not changed. The perceived inequity of the tax code as it stands is real and the Minister is promising to bring forward legislation which will reward the carpetbaggers and the tax evaders and punish those who have borne the task of paying the cost of State services during the past 15 years.

Apparently those who have betrayed the country will be welcomed back and those who pay for running the country will be further penalised in the form of the 1 per cent levy. What an extraordinary Government this is, that in the same year would introduce an additional 1 per cent inequitious levy on those who are already paying their taxes and a couple of weeks later announce an amnesty for those who have evaded their taxes and their due responsibility to the State. It is not, as Deputy De Rossa said, a victimless crime and it is not just the people whom Deputy McDowell spoke about who struggle on a weekly or monthly basis to pay their taxes but all those people in our society who during the past 20 years or so did not get access to a fair education system, because we were not able to pay for it, because those who controlled enormous wealth took it out of the country, salted it away for that period and now propose to bring it back for a minimal penalty. Nothing transmits privilege in this society like education. A great many of our citizens have been deprived of that education as a result of our inability to provide it. Yet what do we do? We drive them out as exiles. They may be better educated than those in the fifties, but not that well educated in a great many cases. These are the exiles who are abroad. Successive Foreign Ministers grovel for additional visas for them, but the tax exiles who denied this State its fair share of tax will be given the red carpet and welcomed back by the State provided they pay 15 per cent off the top. It is an outrage. I cannot believe that the same Minister who in the 1992 Finance Act — and I was one of the few Opposition spokespersons at the time who supported him — shut down some of the bolt holes for those carpetbaggers would open the sluice gates to these people to bring their ill gotten gains back into this economy. It is time we heard from this Minister on what precisely his position is. I believe that this is Albert's amnesty, as I said during the Adjournment debate last week. It really was the final insult to this House not that the Minister for Finance did not take that Adjournment debate — that is not what constituted the insult; he may have had good reason for not being here — but that the Minister for Social Welfare came into this House and presented the case for the Government on the tax amnesty, the same man who has inherited a Department which imposed cuts on the most vulnerable, downtrodden and weak, the people at the bottom of the pile. It was not until he was confronted on a televison programme last night that the Minister announced, for the third time, that he has issued circulars withdrawing some of those cuts. When Deputy De Rossa contacted his Department at 5.05 p.m. yesterday evening no such circulars had been issued, but by the time he got on "Questions and Answers", which is recorded at 7 p.m., the circulars had already gone out. The spectacle of the Minister for Social Welfare coming in here defending this amnesty was insulting to the people.

I want to make a comment on the socalled economic arguments for this amnesty. Is the Government totally insensitive to the fact that the spectrum of political opinion, of people commentating on politics and economics for a livelihood, have opposed and exposed the fallacy and shallowness of any economic arguments? There is an argument, a Leas-Cheann Comhairle, for a onceoff 15 per cent slice off the top for the Revenue, but there is no good economic argument because the fact is that the people who salted away their money in tax havens are not the kind of business people or entrepreneurs that would have put their money into productive investment projects in this country in the first place. If they were, the money would not be abroad. There are any number of vehicles for them to bring their money back in here and invest it appropriately in job creating projects if they were so minded or if that was their disposition, but it is not. They are far more likely to bring their money back and purchase a block of Mespil Road apartments or whatever kind of property came on the market and drive up the price of property in so doing. There is no risk to themselves and this economy is no better off.

The fact remains, and the Minister for Finance knows it, that the one thing this economy is not short of at the moment is big money. What we are short of is suitable investment projects to absorb that money. Whatever argument might have existed when this economy was on the floor at the beginning of this year, when interest rates for mortgage holders were going through the roof and when people could not buy money in the bank to keep their commercial business going, whatever argument there was then for a fiscal boost, it does not exist now, with interest rates going in the opposite direction in the wake of devaluation and an absence of good investment projects for the kind of money envisaged here. There are no economic arguments for this and we really should get away from this simplistic idea that spokespersons and proponents for the amnesty have been getting away with on television, which is that it is terrible that all this money is abroad and are we not better getting it back here, that it can only do the country good. That kind of "Mother macree" economics is neither here nor there and it is about time that somebody exposed it.

Deputy McDowell has dealt at some length with the exposition by the Minister for Social Welfare on the night of the Adjournment debate, and again last night on television, when he argued that we got £520 million from the amnesty in 1988. There is no comparison between the amnesty in 1988 and the one proposed now. The tax cheats in 1988 paid their due taxes and were let off their penalties. They paid their due taxes and that is why we got £520 million. We would not have got £520 million if we had been applying 15 per cent off the top. What is the point in going on with this pretence that this amnesty is the same as the one on the last occasion? The Minister for Finance should tell us as well who is lobbying for this tax amnesty.

A Deputy

The Taoiseach.

Mr. Rabbitte

If this goes ahead — and I hope and believe it will not — it is important, as my colleague Deputy De Rossa suggested on a previous occasion, that names should be published because I would like to see the colour of some of those people who are lobbying for this. There may not be many votes in this tax amnesty but I suspect that there is a good deal of political contributions for whoever brings it in. We need to know from where the lobbying is coming. It is clearly not coming from Deputy Ferris's constituency, to judge from the speech he has just made, and I am quite sure he is speaking for his party. It is not coming from Minister Ahern's constituency. I think we should know. What we are really seeing here is the business man as politician. We have seen this side of the present Taoiseach in other areas of his political conduct in Cabinet. This is the difference between the business man as business man and the business man as politician. I think that the present Taoiseach thinks he can run the country like he ran his private company. One cannot be doing deals and cutting corners and be insensitive to the fact that one is governing a country. One cannot be insensitive to the burden borne by the majority of tax complaint citizens and completely ignore them and spit in their eye in the manner proposed by opening the sluice gates for every carpetbagger who betrayed this country, took his money out of it over the last 20 years, or at least since exchange controls were imposed, and who now wants to bring it back because it suits him to pass it on with the minimum tax liability to his off-spring in this country. It is a disgrace, and I believe the Minister knows it is a disgrace, and now that exchange controls have been lifted it can flow back out just as quickly.

Mr. Cox

Exactly.

Miss Quill

And it will.

Mr. Rabbitte

There really is nothing in this for us. I think it is sad. I do not know about the accuracy of the comments made here about what the line-up in Cabinet on this matter is but I do not see how this can go ahead, given how the Labour Party and a great many Fianna Fáil backbenchers feel about it. We cannot run the country on the basis of saying that we will give Mullaghmore in return for a tax amnesty, and that seems to be the way decisions are being made at the moment —"make Michael D. happy and we will make the Taoiseach happy". We cannot run the country that way.

Mr. O'Malley

Poor old Bertie will be unhappy in either case.

Mr. Rabbitte

The Minister is very unhappy.

Ms O'Donnell

He looks unhappy.

Mr. Rabbitte

He should take his courage in his hands now before more damage is done to the tax collection system over which he presides. What is at risk is the very efficacy of the tax system and I do not see how the Government can expect tax compliant citizens to continue paying their full share of taxes and find themselves treated in this manner. It grieves me to hear, as I heard on the radio when I was driving here this evening, the chairman of the Labour Party, Deputy Jim Kemmy, a politician for whom I have a lot of regard, going out to bat for this appalling amnesty. These are not productive business people. These are the very type of fat cat manipulators of finance in this economy that Deputy Kemmy used to revile. It is sad to see him reduced to saying that we are glad to receive whatever crumbs fall off the table because we need the money. It is as somebody said last night on that television programme when he adverted to James Connolly's remark about the swine getting the biggest swill. Never in the history of the recent politics of this country have we seen such a blatant example of those with the largest snouts at the trough getting most out of it. It is a disgrace that any Government should propose such a measure and expect tax complying citizens to continue to pay the cost of running the services of this State. During an Adjournment debate I referred to a matter which is a good example of this, the shenanigans which surrounded the purchase of the Ballsbridge site in the Telecom affair.

An Ceann Comhairle

I would prefer if the Deputy dealt with the amendment before us.

Mr. Rabbitte

This is precisely the type of person——

An Ceann Comhairle

The Deputy may make a fleeting reference.

Mr. Rabbitte

I made available to the then Minister for Industry and Commerce information which was at my disposal at that time and the first report of the inspector into that affair bore out the validity of that information. However, the inspector concerned, Mr. John Glackin, has now been obstructed in concluding his work precisely because of what will be provided for if this amnesty measure is implemented — in other words, an account in a false name in a foreign bank to which an inspector cannot get access or information about to complete his inquiry and the sole purpose of which is to defraud this State of due taxes and liabilities. It is that type of tax carpetbagger this Government hopes to legitimise and expects the rest of the taxpaying community to applaud. This amnesty measure is a scandal and I hope the Minister for Finance will tell us he will not impose it on the taxpayers of Ireland.

Mr. Boylan

May I share my time with Deputies Doyle and Finucane?

Mr. M. McDowell

There is not enough time for that.

An Ceann Comhairle

I cannot facilitate the Deputy in that regard.

Mrs. Doyle

This matter will be continued tomorrow.

An Ceann Comhairle

Yes, there is no time limit on it and, consequently, there is no time sharing at this juncture.

Mr. Boylan

I was endeavouring to facilitate my colleagues in making a contribution on this important subject. I do not wish to make a long statement on the matter. I merely want to tell the Minister what the people of my constituency and others feel about the implementation of this measure. They believe it is unfair to 90 per cent of the public who are honest, decent people meeting their tax obligations to the letter of the law. There is a growing unease that the laws of this land are being applied unequally, that there is one law for those in the know and that the ordinary citizen must bear the full rigours of the law. Some people can get away with drink driving charges, and kick down doors in well known establishments in the city and get away with it, but if an ordinary poor person takes a pound of butter from a supermarket in desperation he or she will be sent to jail. That has serious consequences for the running of this country and people will rebel.

I fully support the amendment. The Minister is well aware that most small business people are diligent in the manner in which they pay their taxes. They dread the famous window envelope coming in the post and merely want to pay their bills and rear their families. Therefore, it is unacceptable that those they elected and trusted with their votes to take care of their interests are prepared to turn their backs on them and welcome home people with vast fortunes of money that could not have been accumulated in the first place if such people had paid their proper taxes.

I consider myself to be as astute as anybody, but to my knowledge if people pay their way they will not accumulate a fortune. A figure of £2 billion is being talked about in regard to the proposed amnesty. It is unbelieveable that that amount was creamed off ordinary business people in this country. It would be unfair of me to mention certain business areas, but the Revenue Commissioners and the Department of Finance seem to know that vast amounts of money that were not used for productive purposes are stored away in foreign bank accounts. It is unacceptable that the Government should now tell those people they can bring that money home and it will be taxed at only 15 per cent.

The Labour Party is welcoming this measure as if they were welcoming the Prodigal Son. I will not give a lecture on the Bible or moral issues, but to my knowledge the Prodigal Son squandered all his father gave him. These people have accumulated vast amounts of money by sucking it out of the system. I will not disparage all Members of the Fianna Fáil Party because some of them are honest decent people and the Minister is one of them. I know the Minister believes in his heart that this is a wrong move and I appeal to him on behalf of the ordinary citizens of this country to reconsider the matter. If the Minister wants people to continue to pay their taxes he should forget about this amnesty and the public will respond. Jobs are scarce and morale in low, but the people are merely looking for a little lift to show that their efforts are acknowledged by the Government. This injust measure will do the opposite. I appeal to the Minister to reconsider his position on this matter and the public will appreciate him for it. Excellent contributions have been made on this matter, but I am disappointed with the contribution from Deputy Ferris, who has supported the ordinary people for many years. It is appalling that anybody in this House should condone the accumulation of money through the sale of drugs, abuse of our young people and robberies of banks——

Mr. Ferris

I did not say that.

Mr. Boylan

——post offices and the elderly. It is common knowledge that such money has been shipped out of this country and across the Border into Northern Ireland. The Minister is now telling those people that all is forgiven and that they can bring their money home. What about the unfortunate people who have gone through the turmoil of seeing their young children become addicted to drugs because of such ruthless people? It is unacceptable that those who perpetrated such crimes on families and young people or who held up bank managers and their staff resulting in some people having nervous breakdowns should now be made welcome here. The implementation of this measure will leave the country wide open to household burglaries, bank robberies and so on. A Fine Gael or Progressive Democrat Government would certainly not introduce such a measure and a change of Government would be welcome for this reason alone. I am totally opposed to the proposed amnesty.

Mr. O'Malley

In the couple of minutes at my disposal I would like to say something about the proposed amnesty or what might be more accurately called a write-off of tax which is outrageous and unacceptable. It makes a mockery of compliant taxpayers. It also makes a mockery of social welfare recipients who should be considered in regard to this matter. Most days of the week people get money on the dole which they should not get because they are working. If such people are caught they are prosecuted in the criminal courts and sometimes sent to prison for two or three months. We should compare the few hundred pounds at issue in such cases with the millions of pounds at issue under the subject we are discussing now.

It strikes me as unlikely that a proposal that has the strange genesis this one has could have worked because the two principal progenitors I heard advocating it in recent weeks were Deputies Davern and Kemmy. I do not know whether the breeding is by Deputy Davern out of Deputy Kemmy or by Deputy Kemmy out of Deputy Davern. Whichever way it came it is not surprising that it is a piece of economic and social policy that does not work and, in horse-breeding terms, between them in their efforts they have produced a three-legged jennet.

Debate adjourned.