I assume the Deputy is referring to the High Court judgment delivered on the 5th February in Judicial Review proceedings taken by a taxpayer against the Revenue Commissioners. The background to the Judicial Review is that the taxpayer entered into what Revenue considers to be a tax avoidance scheme. The scheme involves the transfer of share rights and results ultimately in the extraction and distribution of funds tax free to the taxpayer. Revenue issued a written notification to the taxpayer that a Revenue investigation had commenced into his tax affairs for certain tax years. They also advised the taxpayer that he no longer had the opportunity to make a qualifying disclosure. A qualifying disclosure, also known as a voluntary disclosure, entitles a taxpayer to a lower rate of penalties when the tax liability is computed.
The central issue considered by the High Court in the Judicial Review proceedings was whether the taxpayer was entitled to make a qualifying disclosure. The High Court ruled that in the circumstances of the case Revenue were entitled to refuse a qualifying disclosure to the taxpayer on the grounds that Revenue’s investigation into his tax affairs had already commenced.
The High Court judgment was not, as such, concerned with matters that determine whether a tax liability arises in relation to the tax avoidance scheme.
Revenue has identified 76 companies to date that availed of the scheme with funds of c.€181million extracted tax free. A number of the cases are the subject of tax appeals and the final amount of related tax liability, if any, will ultimately depend on the final outcome of these appeals. I am informed that consequently the Revenue Commissioners are not in a position at present to quantify any tax liability that may become payable.