13 Jun 2018, 09.52
The Public Accounts Committee (PAC) today published its Report on the Examination of matters in relation to Receipts from Corporation Tax.
The Committee’s examination of Corporation Tax arose from a review carried out by the Comptroller and Auditor General (C&AG) of the factors contributing to the volatile and highly concentrated nature of Corporation Tax receipts.
PAC Chairman, Seán Fleming TD, said, “The PAC held a number of meetings in relation to its examination of Corporation Tax receipts and received a considerable amount of briefing information from both the Department of Finance and the Office of the Revenue Commissioners. We also engaged an independent tax expert to support the work of the Committee during this process.”
“This report draws attention to the highly concentrated nature of Corporation Tax receipts. The PAC finds that this represents an unacceptable level of risk to the sustainability of the Corporation Tax regime and calls on the Department of Finance to carry out a review of the Corporation Tax system and bring forward proposals to address the risk associated with its highly concentrated nature.”
“During the course of our hearings, we requested from Revenue a breakdown of the losses carried forward figures, but found that Revenue data is lacking in detail on the breakdown of losses carried forward by companies. The PAC is recommending that Revenue should:
• Carry out an age analysis and put in place procedures to analyse losses carried forward in order to identify those relating to trading losses and those relating to unused capital allowances;
“The Committee is also recommending that the Department of Finance should consider the introduction of a 10 year time limit or sunset clause and/or other restrictions in respect of losses carried forward. This measure would help to give greater priority to the sustainability of Corporation Tax receipts on an annual basis.”
“We also requested accurate details on PAYE paid by participators in close companies. As Revenue could not provide this information either, the Committee is not satisfied that Revenue can demonstrate that the application of close company rules is achieving its intended purpose.”
Read the report here: https://data.oireachtas.ie/ie/oireachtas/committee/dail/32/committee_of_public_accounts/reports/2018/2018-06-13_examination-of-matters-in-relation-to-receipts-from-corporation-tax_en.pdf
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