Dáil Éireann díospóireacht -
Wednesday, 24 Mar 1993

Vol. 428 No. 2

Written Answers. - Uncollected Taxes.

Liz McManus

Ceist:

69 Ms McManus asked the Minister for Finance the total amount outstanding in uncollected taxes at the latest date for which figures are available; the total amount written off by the Revenue Commissioners for the latest year for which figures are available; the steps, if any, which are being taken to ensure the collection of outstanding taxes; and if he will make a statement on the matter.

Ivor Callely

Ceist:

87 Mr. Callely asked the Minister for Finance the estimated amount of uncollected taxes outstanding at the most recent date/year for which figures are available; and the way in which he intends to address this matter.

Proinsias De Rossa

Ceist:

95 Proinsias De Rossa asked the Minister for Finance the total amount outstanding in uncollected taxes at the latest date for which figures are available; the total amount written off by the Revenue Commissioners for the latest year for which figures are available; the steps, if any, which are being taken to ensure the collection of outstanding taxes; and if he will make a statement on the matter.

Minister for Finance (Mr. B. Ahern)

I intend to take Questions Nos. 69, 87 and 95 together.

I am informed by the Revenue Commissioners that the latest published figures were included in the 1991 annual report of the Comptroller and Auditor General and Appropriation Accounts and showed the position regarding uncollected taxes at 31 May 1992 and the amount written off during the year 1991.

The report showed a total of £2,538 million in outstanding taxes, of which £418 million was shown as likely to be collected and a total of £85.8 million written off in the year.

I must emphasise that the Comptroller and Auditor General points out in his report that the Revenue Commissioners estimate that only £418 million of the £2,538 million is likely to be collected. The reason for the difference is that the figure of £2,538 million consists largely of estimates, which were made by tax inspectors in the absence of returns from taxpayers. It also includes a sum in the region of £425 million relating to cases in liquidation or receivership, only about 10 per cent of which is likely to result in payments. Therefore, to quote a figure of £2,538 million without putting that figure into its proper context gives a misleading impression.

The Government has taken unprecedented action in the last few years to improve the administration of the taxation system. Among the initiatives taken were: the amnesty in 1988, which raised £500 million; amnesties have also been introduced for capital acquisition tax and stamp duty; the progressive development of the self-assessment system and accompanying audit programme for personal and company taxation, and also for capital acquisition tax; the introduction and extension of the withholding tax on professional fees; the extension of the construction industry tax deduction scheme to other sectors; the introduction of tax clearance requirements for public contracts, grants and certain licences issued by the Revenue Commissioners; the introduction of a new system of tax enforcement by sheriffs; the introduction of power to attach the assets of tax defaulters; the introduction of new general anti-avoidance provisions and the strengthening of the Revenue's powers to counter evasion and avoidance; and the collection initiatives by Revenue in 1991 and 1992, which facilitated, among other things, the rapid pursuit of interest due on late payments, the release of experienced staff for an increase in audits and an increase of staff numbers engaged in the collection of arrears.

As to results, some of those measures have already contributed to better collection and enforcement of tax obligations as evidenced by the ongoing reduction in outstanding amounts shown in the reports of the Comptroller and Auditor General for the past six years. The amount outstanding as of 31 May 1992 was some £1,634 million less than at 31 May 1987.

An overall reduction of £180 million in the amount outstanding is noted for the most recent 12 month period reviewed by the Comptroller and Auditor General. It is also noted that this reduction occurred in a period during which over £7,300 million in additional charges fell due for collection. In addition, the Revenue Commissioners have succeeded in collecting £255 million of entrenched pre-amnesty arrears since 1989. This achievement is quite impressive when viewed against the figure of £418 million.