Operational matters concerning individual taxpayers are a matter for the Revenue Commissioners and confidentiality must also be borne in mind. As a result of these constraints it is not possible to reply with full details of this case.
However, I am advised by the Revenue Commissioners that the events referred to in the particular case took place over a considerable period of time. It is a feature of the property development sector that a different limited company is usually formed for each development. The amounts written off related to the liabilities of individual companies of which the property developer was a director. In the case of limited companies outstanding tax liability can normally only be collected from the company itself. Where there are outstanding liabilities from a company that has ceased trading, confirmation from the director that the company has ceased trading is usually sought. In the case in question it proved difficult to establish the identity of the director and, in the circumstances, a decision had to be taken without contacting him. The decision to write-off the tax was made on the basis that the company had ceased trading and there were no assets in the company to meet the outstanding liability.
As a result of the Comptroller and Auditor General's findings the decisions to write-off the tax have been re-visited in each case. In general, decisions to write-off the tax remain valid in so far as they relate to the individual companies. I understand that the Revenue Commissioners are, however, also examining the financial situation of the property developer himself and a formal investigation is under way to determine if there has been under-declaration of income. This is now the most appropriate way of recovering any tax that might have been underpaid.
More generally, the Revenue Commissioners have advised me that many of the collection shortcomings highlighted by the report related to collection activities from some time ago. Over the years the whole approach to tax default has improved significantly and continues to be improved as lessons are learned. It is clear that the pursuit of the cases referred to would be radically different today.
Of particular relevance in this case is the Companies Registration Office's search facility which has been available since September 2000 and now provides Revenue with the ability to examine records in that office. The significance of this facility is that it allows officers involved in compliance to create the links that the Comptroller and Auditor General mentioned in his report. Such a facility was not available prior to September 2000.
While the Revenue Commissioners are confident that many of the collection shortcomings identified by the Comptroller and Auditor General no longer arise in practice, the report demonstrates that there is always room for further improvement. Since the Comptroller and Auditor General's report, the Revenue Commissioners have introduced additional measures to improve effectiveness in this area. The need for possible legal changes is also being examined and I will consider this aspect further in the context of the Finance Bill.