I propose to take Questions Nos. 127 to 133, inclusive, together.
I am advised by the Revenue Commissioners that information is not maintained in a manner that would enable replies to be provided to these questions in the level of detail sought by the Deputy.
The Revenue Commissioners maintain sectoral audit records on the basis of an internationally recognised 4 digit NACE Code system. NACE code classifications in tax records are compiled by reference to the primary area of economic activity reported by individual and corporate taxpayers on their own behalf. While the accuracy of the NACE codes on tax records is sufficient to underpin broad sector-based analyses there will undoubtedly be some inaccuracies at individual level. This should be borne in mind when considering the information provided as follows.
There is a very broad range of codes which might encompass the activities comprehended by the questions. Accordingly, the Commissioners have identified the following codes to be the most relevant to the Deputy's questions:
7511 — General (overall) public service activities;
7512 — Regulation of the activities of agencies that provide health care, education, cultural services and other social services, excluding social security.
8511 — Hospital activities
8514 — Other human health activities.
The first two codes cover many Government Departments as well as other Government Agencies.
Furthermore, the Commissioners have advised me that they have attempted to exclude obvious private sector bodies which are also included in those NACE Codes because of the activities they are engaged in. On that basis, the following information may be helpful:
Table 1 — Audit Results
Category
|
2007
|
2008
|
2009
|
2010 (to March)
|
Total Number of Audits
|
36
|
26
|
9
|
4
|
Number yielding
|
28
|
21
|
7
|
4
|
Tax*
|
€3,601,000
|
€1,696,000
|
€99,000
|
€576,000
|
Interest
|
€406,000
|
€140,000
|
€6,000
|
€91,000
|
Penalties
|
€246,000
|
€82,000
|
€17,000
|
€168,000
|
Total Yield
|
€4,253,000
|
€1,918,000
|
€122,000
|
€835,000
|
Number Nil yielding
|
8
|
5
|
2
|
—
|
*A breakdown on a tax head basis is not available without conducting an extensive investigation of the individual audit records of the cases.
Recoveries in relation to unprompted voluntary disclosures are not categorised separately and are therefore included with the overall audit results.
Settlements under Section 985B, Taxes Consolidation Act 1997 are not recorded separately.
Where material issues, giving rise to tax undercharges, arise in the course of an audit, tax, Revenue will pursue payments for interest and penalties. Where it is clear that a taxpayer has broadly done their best to ensure that the tax returns for the various taxes are accurate, adjustments are not made for small inaccuracies.
Revenue also informs me that, as well as audits, they carry out a range of assurance checks to supplement general audit activity. All such interventions are initiated with the intention of assuring Revenue, without recourse to a resource intensive audit or enforcement activity, that the customer is broadly compliant for the taxes and duties which are the subject of the intervention. Over 350,000 such checks were carried out in 2009 and would have included public bodies. Due to the volume of these assurance checks, they are not recorded by sector.
I have been advised by the Revenue Commissioners that, in accordance with their risk-based approach, cases are selected for intervention based on the presence of various risk indicators and other information available, with the aid of their computerised risk analysis system, REAP. The type of intervention to be undertaken is, in any particular case, the one considered to be the most appropriate to target the specific risk identified. In many cases this may lead to a single tax head, multi tax head or single-issue audit rather than a comprehensive audit.
As well as targeting individual cases on a risk basis, Revenue is continuing its policy of targeting evasion on a sectoral basis. Generally, audits or enquiries are initially carried out on a limited number of cases within a sector. On this basis, specific features or practices are examined to determine if tax evasion is evident. The results are extrapolated to the sector as a whole, and a decision taken as to the merits of extending the project.
I am satisfied that the Revenue Commissioners are pursuing a multi-faceted programme in managing compliance risks and are dealing in a determined way with tax evasion.