Finance Bill 2011 [Certified Money Bill]: Committee Stage (Resumed)

Sections 62 to 64, inclusive, agreed to.
SECTION 65
Question proposed: "That section 65 stand part of the Bill."

The section provides for a levy on private health insurance. The question I have goes back to when the new leader of Fianna Fáil was Minister for Health and it relates to the VHI's reserves. Why are VHI customers being hit so hard with levies and increased costs given we have never been given a clear answer as to why VHI needs a capital reserve of 40% when it could be 25%? Has the Department of Finance considered reducing the reserve ratio from 40% to 25%? There is no need for a health insurance company to have a reserve of 40% because it does not encounter the issues a normal insurance company faces. For example, a health insurance company does not have to deal with flooding and burst pipe claims and so on like a normal insurance company. Such companies require a reserve of 40% but private health insurance companies could get by with a reserve of 25%. Has the department ever examined this? This would prevent penal levies being applied to customers on top of penal increases in their health insurance premia. I was Fine Gael spokesperson on health between 2004 and 2007 in the Dáil. Deputy Martin was supposed to deal with this issue when he was Minister for Health, as was Deputy Harney, when she succeeded him. Unfortunately, we have never been given a clear answer on this.

This matter is not exclusive to the VHI; it is a matter for all health insurance companies. It is also a matter for the Minister for Health and Children, not the Minister for Finance

At the end of the day, it is a significant financial matter. Deputies Harney and Martin did not answer the question when they served as Minister for Health and Children. I had hoped the Minister for Finance who has told us he is down in the engine room morning, noon and night trying to sort out the economy might do something for those who have private health insurance and who are getting hammered with increases.

Question put and declared carried.
SECTION 66
Question proposed: "That section 66 stand part of the Bill."

I welcome the Minister of State. This section relates to stamp duty. Many Members have been contacted by first-time residential property buyers who were formerly exempt from stamp duty in the past number of days. They have not only experienced a reduction in their pay packets, an increase in the cost of their health insurance and the impact of the universally detested USC but they will also have to pay stamp duty, which they had not anticipated, when buying a home. I received an e-mail, which I am sure other Members received, in which the individual said he and his partner face an additional payment of €4,000, which is a significant amount, as a result of the changes proposed in this section. I am sure the Minister of State will point out that there is a reduction in stamp duty for non-first-time buyers. That is to be welcomed in terms of trying to get the housing market moving. At the very least there should have been transitional measures for first-time buyers who are actively contemplating buying a house or who have started the process. I accept there is a provision in section 66(3) relating to transitional arrangements but I gather — the Minister of State might clarify — that people will still be caught who had not anticipated having to pay this amount and for whom this will make a significant difference, especially given the effect of the budgetary measures and the imposition of the universal social charge on their January pay packets.

We did not have a chance to discuss the universal social charge due to time limits in the debate earlier today. The Labour Party tabled recommendation No. 5 on the matter on Committee Stage and I hope we will be able to return to the issue on Report Stage to discuss the impact of the universal social charge which, as the Minister of State will be well aware, has been the subject of enormous concern to people. An economic impact assessment should have been carried out on the imposition of the universal social charge. It was ironic that the impact of removing the section 23 tax relief was to be assessed prior to being introduced yet the universal social charge was simply to be introduced without any economic impact assessment, especially concerning low earners. That was the subject of our amendment which, as the Leas-Chathaoirleach is aware, we did not reach.

The recommendation has been dealt with.

I hope we will get an opportunity to discuss it on Report Stage. I would like the Minister of State to clarify the position in respect of stamp duty in section 66 and to put on record the concerns of first-time buyers such as those who have been in touch with us by e-mail.

I understand the universal social charge was dealt with earlier. Substantial reform has taken place in the budget and the Finance Bill on stamp duty. Some of the major changes introduced will be of extraordinary benefit compared with the previous regime. Properties valued up to €1 million are now liable to stamp duty at the rate of 1%. Where the value of the property is in excess of €1 million, the rate increases to 2%. Under the previous provision a rate of 7% applied on property values that exceeded €125,000 and the rate on properties valued at in excess of €1 million was 9%. There is a substantial gain for people under the new stamp duty regime. As Minister of State with responsibility for housing I expect the change to have an important stimulus effect on the property market by removing uncertainty. It may have a knock-on effect on the level of activity in the market. I am not trying to push people into the market but according to figures I saw yesterday, it seems stability has come to the market. I accept the number of sales that have taken place is limited. I do not think we should embrace the fact at this time but it does give an indicator, albeit at the lower level.

Stamp duty on property valued at €200,000 was €5,250 under the previous regime. That has now fallen to €2,000, representing a saving of €3,250 or 62%. That is a substantial saving under the new regime. Similarly, stamp duty on a house valued at €300,000 is now charged at €3,000 instead of €12,250. That is a saving of €9,250 or 76%. The reform of stamp duty will have a positive benefit for people in the property market or those who wish to enter the property market.

In my initial contribution I acknowledged that the budgetary changes resulted in many people making savings on stamp duty. As the Minister of State will be aware from his own experience as Minister with responsibility for housing, however, there was more activity in the housing market among first-time buyers, even given the unstable and weak property market we have seen recently, precisely because they did not have any negative equity. I specifically ask the Minister of State to address the point I raised of the impact of the change in stamp duty on first-time buyers. That is something that has been raised with me. Is it not the case that the proposed change will have an impact on those seeking to enter the market for the first time who had not anticipated having to pay stamp duty and are now liable to pay it? I think I am right. That is what people understand to be the case.

I accept Senator Bacik's argument but I must be practical in what I say in response. It would be great if Senator Bacik could tell me where she can buy a house for €125,000 in Dublin city at the moment but no such price has come across my desk in the Custom House. The current regime is a great improvement on the previous regime. First-time buyers must live within their means. They buy at various levels in the market — or they did, given that there is not much activity in the market currently. I do not see how one could say the change is an imposition on first-time buyers based on the threshold of €125,000. The regime is reformed on the basis of the figures I outlined. I do not accept that an extra imposition is being made on anyone as the changes are of benefit.

The new rates will apply to properties transferred on or after 8 December 2010. A transition measure will be put in place to ensure that anyone who has entered into a binding contract to purchase a property before 8 December 2010 and who executes the transfer of that property before July 2011 will not be at any disadvantage. That is the bottom line on this particular matter.

I did say I recognised there was some attempt at providing a transitional arrangement in section 66(3), but it is clear that people who had contemplated buying a house will still be caught. The Minister of State has accepted that first-time buyers who had contemplated buying a house had put their finances in order for a particular sum and must now face having to find a substantial additional amount of approximately €4,000 based on stamp duty at 1%. The change will have an impact on them. I wish to ensure that is put on record and the Minister of State is made aware of the impact.

Question put and declared carried.
Sections 67 to 69, inclusive, agreed to.
SECTION 70
Question proposed: "That section 70 stand part of the Bill."

Section 70 provides for the filing of tax returns in respect of capital acquisitions tax by 30 September each year in place of 31 October. The Minister of State will recall that a similar change was proposed for income tax generally but that was reversed in the Dáil deliberations on the Bill. It is an oversight and a flaw in the Bill that the provision was not similarly reversed for capital acquisitions tax. I say it is an oversight because if one goes back to the Finance Bill 2010, the explanatory memorandum states that the Bill provides for the payment of capital acquisitions tax and the filing of a return to be brought into line with other self-assessment taxes. The objective was to have the same deadline for the submission of returns and payments in the case of income tax on a self-assessment basis and capital acquisitions tax. I ask the Minister of State to accept that this section be deleted. I would be disappointed if this type of correction could not be accommodated during the debate today. It should be if the House is to have any input and the debate any meaning in terms of correcting what are clearly oversights and errors in the Bill as a result of the speed with which it been dealt in the Dáil.

The Capital Acquisitions Tax Consolidation Act 2003 relates to the payment of gift tax and inheritance tax and the filing of returns in respect of these taxes. I understand this is the area of interest to the Senator. The amendment brings the date of the file and payment forward from 31 October to 30 September. Section 70, as passed by the Dáil, brings forward the pay and file date of the Capital Acquisitions Tax, CAT, in respect of gift tax and inheritance tax from 31 October to 30 September. The section also makes consequential changes to the provision relating to the date when interest becomes chargeable in respect of the late filing of a return. Section 46(2A) of the Capital Acquisitions Tax Consolidation Act 2003, inserted by the Finance Act 2010, provides that where the valuation date in respect of a gift or an inheritance arises in the period from 1 January to 31 August, tax must be paid and a return delivered on or before 31 October of that year. Where the valuation date arises in the period from 1 September to 31 December, tax must be paid and a return delivered on or before 31 October in the following year. Returns filed electronically benefit from the extended filing deadline of a further two weeks. The extension applies to more complex CAT cases since cases involving more complex CAT reliefs, such as benefit and farm relief, are statutorily required to be filed electronically. The Revenue electronic system provides calculation assistance such that taxpayers and their agents can be assured that the correct tax has been paid. For example, in the case of a valuation date that arises in August, the date due for filing a return and paying tax will not be 30 September. In practice, most returns will be delivered electronically under the Revenue's on-line system. This affords a solicitor acting for a taxpayer six or seven weeks to deliver a return and pay tax, even where a valuation date arises at the end of August. That is the position on the Senator's query.

I recognise that the Minister of State has given us several dates. I trust he will correct me if my understanding of the matter is wrong. However, I understood that last year or the year before we changed the date of the return of capital acquisitions tax to a date in October as a tidying up operation and to ensure the two dates coincided. The argument from the Department at the time was that both dates should be the same in everyone's interests. This is on what I wish to focus and I support the points made by Senator Regan. I believe we should delete this section. The Government then decided that it would get back the self-employed tax one month earlier in September in order that money would come in earlier. It took the view, following from the logic of the previous year, that since it was bringing back the self-employed deadline by one month it would also bring back the date of return for capital acquisitions tax. Consequently, the Finance Bill as published had the new date in September for capital acquisitions tax and self-employed returns. That was fine and everyone was aware of it although some people expressed reservations. Chartered Accountants Ireland stated this would create a great deal of pressure on everyone to get returns in on time and resisted the measures. I am unsure how strongly it resisted the changes but it expressed concerns and called for the changes to be reconsidered. In the meantime, two men, Independents, in the back row of the Dáil took a similar view. They indicated to the Government that they would not be in a position to support the Finance Bill for several reasons, one of which was the earlier date for taxation returns. Having listened to them and everyone else, or perhaps for no reason, the Government decided not to change the date for the self-employed returns and amended the Bill accordingly. However, the Government forgot to do the same in the case of capital acquisitions tax. We are left with the same anomaly, an inverse anomaly to that which arose last year. Last year there was a difference of one month and now there is a difference of one month.

We do not propose to change the wording but to take out section 70 which would ensure that both dates are the same. People should come out with their hands up, admit they made a mistake and got it wrong and correct it now. The sensible thing would be to delete section 70. I believe Senator Mary White would agree with me. There is enough pressure on self-employed people and small businesses. The deadline one month earlier would have been a disaster for them. Moving the date for capital acquisitions tax now flies in the face of the logic given to us last year, which was to have both returns in the same month and on the same day. I oppose section 70 and I urge the Minister of State to accept that it should be deleted. I support the proposition of Senator Regan.

The Minister of State gave an explanation of what is in the Bill, which is helpful, but it is no more than an explanation. He has given no argument as to why the correction I propose could not be accepted. A policy of consistency was instituted last year which provided that the filing of returns in respect of capital acquisitions tax be brought in line with other self-assessment taxes. The opposite is being done this year but I do not believe this was the intention. I believe it was an oversight when the policy of bringing forward the self-assessment returns to September was reversed. In the interests of consistency, the same should be done here. The reason we have the Seanad is to examine and to point out these anomalies in legislation even if it is being put through at rapid speed. I call on the Minister of State to recognise the error made in the Bill.

The reason the Minister changed the legislation earlier in the Dáil was predominantly to facilitate the farming community. Single farm payments are made in the middle of October and farmers would have been expected to pay tax on income earned two weeks after the deadline. It would have been a matter of great concern to farming communities to have to pay up-front based on a cheque expected in the post two weeks afterwards. This was the main thrust of the case made by Deputies Healy-Rae and Michael Lowry. It is a pity there was no taxation expert available to explain capital acquisitions taxation issues to Deputy Jackie Healy-Rae. Otherwise, perhaps the Minister would not have found himself in this position. Now, he must try to correct a problem he made for himself.

In some respects this is a technical amendment. If one seeks proper continuity in taxation legislation and one seeks to line things up properly, it stands to reason that what Senator Regan is suggesting is correct. The Minister should get rid of this section. I am unsure whether it is because he does not wish to discommode the same Deputy Healy-Rae, drag him up from Kerry at 8 p.m. and have him correct the legislation after he went to so much trouble some time ago to sort it out for the Government. Senator Regan is correct.

This section should be amended, not in the way proposed by this side of the House but in the way outlined by the Minister for Finance in the explanatory memorandum to last year's finance Act.

The Government now maintains it does not create a difficulty in principle if there are two deadlines when last year it claimed they needed to be the same. Will the Minister of State give the theoretical justification for this change of argument?

I understand this provision was inserted primarily to produce a yield for the Revenue Commissioners and in order that the Government would have a cash-flow a month earlier. I argued this morning about the problems this would create for the self-employed and small enterprises. Recently I heard a businesswoman on radio explain how her company which employed a few people was just about liquid. If she had to find the money one month earlier to pay this tax, she would have to go to the banks for it. More than likely, she explained, they would refuse her credit and her company would collapse. I cannot believe the Government wants there to be such absurd scenarios. I am not going to say anything personal about Members of the other House who secured this alteration to the Bill. I welcome the fact that the Government has amended the provision for self-employed persons with small businesses.

There are many anomalies in the tax system. In the past I did other work in broadcasting, film and theatre and had to engage in the irritating business of forecasting my earnings from this work. I understand why the Government needs a cash-flow, but projecting one's income when one does not know how much one will receive is impossible. If one declares too little, one is charged interest by the Revenue Commissioners; if one overpays, one certainly will not get any interest payments back. I am interested to hear the justification for retaining two separate dates. This apparent anomaly was rectified last year but in a way that prejudiced some small businesses. They got on to representatives in the other House who put the squeeze on the Government which, accordingly, amended the legislation. I welcome the change made.

I will vote against the section with Senators O'Toole and Regan unless the Government convinces me that the arguments it made last year for aligning the dates do not apply this year.

It seems anomalous that the deadline for the making of tax returns by the self-employed was extended again but was never changed in the case of capital acquisitions tax. Having separate dates creates an undue burden of extra bureaucracy. It is not just that the deadline is one month earlier but September is a significant month for manufacturing businesses, as the summer can be a quieter time and cash-flow may be needed to meet other payments. It is reasonable, therefore, to leave the deadlines the same for both tax returns. As other Members said, it seems the Government overlooked this matter when it reversed its original decision to bring forward the deadline in respect of capital acquisitions tax. It is not a major ask for the section to be deleted.

I understand how these deadlines were overlooked. If we want to make Ireland attractive for small businesses to start up in, we need to remove much of the red tape. Several years ago Panama decided it was going to encourage new businesses to open there. One measure it introduced to achieve this ensured it would take only seven hours for a business to go through the paperwork needed to set up. Measures such as the one contained in this section go against the opportunity of making Ireland an attractive location to establish new businesses. I urge the Minister of State to delete the section.

While this section provides for capital acquisitions tax, inheritance and gift tax, it has nothing to do with small business. Ireland, despite what has been said, is positive when it comes to new businesses. According to the World Competitiveness Yearbook, it remains an attractive place in which to do business. In the competitiveness league table it is in first place in respect of corporate tax rates, fourth in respect of the availability of skilled labour, fourth in being open to new ideas, sixth in respect of labour productivity and seventh in respect of the availability of financial skills and the flexibility and adaptability of its people. Up to 50% of enterprises in Ireland are engaged in innovative activity, placing Ireland well above the EU average of 39%. While I respect Senator Regan's arguments on the section, they are not precisely to the point in this regard.

In the Finance Act 2010 the dates for pay and file returns by the self-employed and for capital acquisitions tax were brought forward. After concerns were expressed by the self-employed, they were removed from this provision in this Bill. There were valid reasons for bringing forward the dates as it allowed for the making of more accurate forecasts. The general concerns about the self-employed had nothing to do with farmers, Deputies Healy-Rae and Lowry. It had to do with the genuine concerns brought to the Minister's attention by tax firms and IBEC. It is a common-sense response to their concerns.

Senator Mary White is correct that this section relates to capital acquisitions, inheritance and gift tax, not the self-employed and small companies. It is important to place that point on record. What is being done relates to the fact that the Minister for Finance responded to concerns raised by tax firms and others.

Senators will accept that bringing forward the dates relating to the self-employed and CAT will, as I have already stated, be of great assistance when it comes to forecasting. Neither the Minister nor his Department has made a mistake. What is proposed in section 70 represents a response to concerns that were raised. In such circumstances, the arguments put forward by those on the opposite side of the House cannot be accepted.

I wish to place on record the fact that there will be no cash-flow benefit for Revenue as a result of what is proposed. I must inform Senator Norris that interest applies in respect of overpayments made.

The Minister of State has not offered any argument which is sufficient to justify the anomaly contained in the Bill. He referred to the original intention of the Minister, Deputy Brian Lenihan, in bringing forward the dates relating to the self-employed and CAT is to enable better forecasting. The Minister reversed his position in that regard and it appears that either he or his Department has forgotten the consequential amendment that will be required as a result. I am not making a political point here. My argument relates to the technical and self-evident flaw contained in the Bill, which introduces an inconsistency in the Government policy enunciated in last year's Finance Act. I cannot understand how the Minister, when he considers its merits, is unable to accede to the argument being put forward.

It is self-evident that there is an inconsistency in the Bill. That inconsistency was corrected last year but it has been reinstated in section 70. I intend, therefore, to press the matter to a vote. If what is happening is representative of the manner in which the Minister for Finance is intent on dealing with recommendations or corrections in the House, he is making the Seanad irrelevant. It is disappointing for Senators, who are assisting the Government with regard to the passage of the legislation, that the arguments they are putting forward — which would involve the making of technical amendments consistent with the Government's policy — are being dismissed.

An attempt is being made to portray what is being done in section 70 as some type of oversight or mistake on the part of the Minister. I categorically deny this is the position.

The mistake is self-evident.

The Minister of State, without interruption.

That is not the situation. The position is that the Minister responded to concerns expressed by the self-employed and others regarding this matter. That was quite a practical step to take. Different dates apply in respect of the payment of various taxes. What is new about that? I wish to reassure the House that the Minister took this decision——

It was the Government that wanted to tidy up the position.

The Minister of State, without interruption.

——in response to submissions he received. The self-employed were concerned that, perhaps, there had not been adequate engagement with them. The Minister was correct to take this practical step.

I thank the Minister of State for the explanation he has provided. I was very interested to learn that one can obtain interest in respect of overpayments. I shall re-examine my tax calculation to discover whether I received such interest. However, that is a very minor point of a personal nature.

Despite his illuminating comments, the Minister of State did not answer one specific question I put to him. As a result, I feel obliged to pose it again. There has been a change of Government policy. In this House last year, the Minister for Finance, another Minister or a Minister of State offered what were obviously compelling arguments to the effect that the two dates we are discussing should be aligned. The record will show that in the debate on last year's Finance Act, arguments were put forward and the House then voted in favour of what was proposed. I am sure that, on the occasion in question, Senators voted on a majority basis because they were convinced by the arguments offered by the Minister or someone acting in his stead.

Something has changed because the Government has decided, as the Minister of State indicated, that there is no difficulty with having different dates. I am not a tax expert, but he maintains that different dates apply in respect of various taxes. I hope there are not too many such dates because that would suggest a certain amount of chaos. However, there may be different dates in certain technical areas, the obscurity of which has removed them from my attention.

The fact remains that a Minister of this Government — from the seat in which the Minister of State is listening to the points we are putting forward — last year offered an argument — which subsequently prevailed — to the effect that it was important, in the context of the well-being of the country's finances, to align the dates. We have now changed one, as a result of argumentation. It does not matter to me who was responsible for having the relevant amendment accepted. I have no doubt the two people to whom the Minister for Finance referred in the Lower House may have had some impact. However, I heard both the representative of IBEC and the woman to whom I referred speaking on the radio. As far as the latter was concerned, it was certainly a question of money and not one of forecasting. Indeed, it was a matter of required payment and being obliged to find the money. It is not the case that one can provide a forecast to the Department of Finance. My forecasts are always accompanied by a cheque. That is the problem. It is a question of money, it is not just a forecast. What has happened has created significant difficulties for a large number of small businesses.

I very much welcome the fact that this change was made in the Lower House. However, my simple question remains unanswered. What principled, philosophical or policy change occurred between last year and this? Is there an explanation to be offered which is based on a coherent approach to the financial strategy of the Government or is it just a case of pragmatism? Was it the case that the scales dropped from the eyes of the Minister for Finance and that, as a result of interventions on the part of various professional bodies, accountants, tax experts, members of IBEC, etc., and on foot of political pressure exerted in the Lower House, he perceived the need to change the position? If the latter was the case, then he was being pragmatic. There is no theoretical support or basis for what was done. We are talking here about a political judgment made in the light of political reality. If the Minister of State could provide an answer to the specific question I have posed, I would be extremely grateful.

Why are the dates different? The Minister of State indicated that it is quite common for there to be different deadlines in respect of the payment of various tax returns. I accept that. However, why are the dates relating to the self-employed and CAT different when it is clear that the original intention was for the same date to apply in respect of them? I do not believe the Minister of State has responded satisfactorily to that question.

Many things have changed in the past 12 months. I accept the point to the effect that the Minister wanted to bring forward the date. There is no question about that. If he had not responded to the concerns expressed by the self-employed, I am of the view that a counter-argument would have been put forward by Senators during this debate.

I welcome the fact that he responded. I inquired with regard to the philosophical change which occurred between last year and this.

The Minister responded in light of the concerns expressed by——

That is not the issue.

——the self-employed, IBEC and others. An attempt is being made to state that what is being done resulted from the involvement of some other individuals. I completely reject that assertion. There was a short timeframe involved and the self-employed, IBEC and the others to whom I refer had concerns with regard to the level of consultation that had occurred. It was quite appropriate that the Minister should respond to those concerns. Those to whom I refer are major contributors to the economy. If the Minister for Finance had been pig-headed and refused to accept their concerns, I am of the view that Senators — on foot of representations made to them — would be offering a different argument today. I compliment the Minister for Finance on dealing with the concerns that were raised in the context of the short consultation period.

I reiterate that there will not be a cash-flow benefit to the Revenue nor to the Minister as a result of what is being done. That is the factual position.

Is section 70 opposed?

The Minister of State did not answer the question.

Question put.
The Committee divided: Tá, 28; Níl, 23.

  • Boyle, Dan.
  • Brady, Martin.
  • Butler, Larry.
  • Callely, Ivor.
  • Carroll, James.
  • Carty, John.
  • Cassidy, Donie.
  • Corrigan, Maria.
  • Daly, Mark.
  • Dearey, Mark.
  • Ellis, John.
  • Feeney, Geraldine.
  • Glynn, Camillus.
  • Hanafin, John.
  • Leyden, Terry.
  • McDonald, Lisa.
  • Mooney, Paschal.
  • Ó Brolcháin, Niall.
  • Ó Domhnaill, Brian.
  • O’Brien, Francis.
  • O’Donovan, Denis.
  • O’Malley, Fiona.
  • O’Sullivan, Ned.
  • Ormonde, Ann.
  • Quinn, Feargal.
  • Walsh, Jim.
  • White, Mary M.
  • Wilson, Diarmuid.

Níl

  • Bacik, Ivana.
  • Bradford, Paul.
  • Burke, Paddy.
  • Buttimer, Jerry.
  • Cannon, Ciaran.
  • Coffey, Paudie.
  • Cummins, Maurice.
  • Donohoe, Paschal.
  • Fitzgerald, Frances.
  • Hannigan, Dominic.
  • Harris, Eoghan.
  • McCarthy, Michael.
  • McFadden, Nicky.
  • Mullen, Rónán.
  • Norris, David.
  • O’Toole, Joe.
  • Phelan, John Paul.
  • Prendergast, Phil.
  • Regan, Eugene.
  • Ross, Shane.
  • Ryan, Brendan.
  • Twomey, Liam.
  • White, Alex.
Tellers: Tá, Senators Camillus Glynn and Diarmuid Wilson; Níl, Senators Maurice Cummins and Eugene Regan.
Question declared carried.
Sections 71 to 73, inclusive, agreed to.
SECTION 74

I move recommendation No. 9:

In page 214, lines 12 to 22, to delete paragraph (a).

Section 1002 of the Taxes Consolidation Act gives many powers to the Revenue Commissioners to ensure taxes are paid and collected, but the proposal in this section is a step too far. I accept this Bill is a form of emergency legislation but this provision should not be slipped in like this. What we have here is a power being given to the Revenue Commissioners to serve a notice which attaches the emoluments and earnings of a person for the purpose of collecting taxation, where it determines that there is a debt due from the taxpayer, regardless of whether it is contested and without any intervention of the courts.

There have been many debates in this House about attachment of earnings for the payment of fines but this has been consistently resisted by the Minister for Justice and Law Reform, yet here is an attempt to confer such a power on the Revenue Commissioners. I question its constitutionality and propriety. It is a police-state type of provision and I do not believe it should be waved through this House without proper scrutiny and debate. Section 74 should not form part of the Bill. This is a draconian measure. People I have spoken to and even people in the Revenue Commissioners do not believe it is necessary and consider it to be over the top. There is no explanation as to why such a power is required or where there is a deficit in the powers of the Revenue Commissioners which necessitates this type of draconian measure.

It is disproportionate to what is sought in any of these provisions relating to the powers of the Revenue Commissioners. It is not necessary or appropriate and I question its legality. I oppose this extraordinary power which the Bill seeks to confer on the Revenue Commissioners.

I fully support the points made by Senator Regan. I generally support powers for the Revenue Commissioners but, and the Minister can correct me on this, a number of issues arise from this. One is the constitutional provisions on private property. How can one attach somebody's salary without going through a process, usually a court process? I do not know whether issues such as errors in fact and errors in law come into this discussion. It is not a case of me not wishing to give power to the Revenue Commissioners, but this is far in excess of what would be available to a state in a normal democracy. That is the issue. It is a very serious point and I ask the Minister to address it. Is it a fact that an arm of the State can effectively attach and take from a person's salary without going through a process in the courts or otherwise? It appears to be an extraordinary power. What are the legal bases and constitutional issues that were waded through to get to this point?

I support Senator Regan's recommendation and echo what Senator O'Toole said. There might well be a question of constitutionality if, for example, the disposition of a home and property is concerned in this business. I do not know about that. Again, I wish to ask the Minister a specific question and perhaps on this occasion he might find it possible to answer it. Are there any limitations on this? There do not appear to be. This is a very broad brush. It is a general power of attachment.

What concerns me, and it might be covered by other regulations, legislation or the Constitution, is a case where an order of attachment is made and virtually all of a person's income is taken away because of a debt. The debt exists and there is a moral obligation to pay it, but what about the living arrangements of the person involved? If this is the only income that person has, surely some arrangements must be made to permit them to continue to live and support their family.

This is an absolute power and there appear to be no limitations set to it by this section. That is a horrendous power to exercise against a citizen. Of course, they might have incurred and owe the debt but they are still entitled to look after the welfare of their family and to provide proper accommodation and sustenance for themselves and their family. Nowhere does that figure in this provision. If Senator O'Toole's assumption is correct that there is no recourse to law and no review by the judicial system, this is far too sweeping.

I am surprised at this provision because it appears to be far over the top. I am probably guilty of not knowing the Constitution well enough but it appears likely that it would be outside a person's constitutional rights to do this. If I understand "the relevant person to the taxpayer as emoluments under contract of service" correctly, it means that if somebody is entitled to a salary, the Revenue Commissioners may take that amount of money out of the emoluments. As Senator O'Toole said we all want to ensure those who owe tax pay it. However, it seems to say the Revenue Commissioners can take all the person's salary and the total emoluments — the Bill does not seem to say it can take a portion of it over a number of years. It might be somebody working for the State who owes money and the State will be able to take every single penny of it. It seems that such a person would not be able to feed his or her family and to carry on a normal life. I imagine it is highly unlikely that the provision is constitutional, although I do not know the Constitution well enough to be able to say that it is so. However, I believe this is one particular flaw in the Bill. If there is any part of the Bill on which we should be able to pass a recommendation, it is this section. It is highly unlikely that it is constitutional. We are supposed to have a second look at legislation in this House, so this is exactly what we should be doing and I compliment Senator Regan on finding it.

I echo the concerns raised by other speakers on this provision. Can the Minister clarify to what extent this provision expands the existing powers of the Revenue Commissioners under section 1002 of the principal Act, the Taxes Consolidation Act 1997? It seems to bring about a significant expansion of the existing power of the Revenue Commissioners, and that is a very valid concern.

Section 74 introduces a number of measures in respect of the attachment of debt. The Senator's recommendation would remove from the Bill the provision that allows the Revenue Commissioners to attach emoluments to recover unpaid liabilities of taxpayers. Attachment of an enforcement is an option available to the Revenue Commissioners to recover unpaid tax, unpaid interest or unpaid penalties due by taxpayers who have ignored collection approaches, notifications and procedures taken by Revenue. Attachment is used judiciously by Revenue in accordance with strict guidelines which require that any decision to use attachment must be approved at principal officer level, or nominated assistant principal officer level.

A number of amendment provisions have been made, in light of the experience of the Revenue Commissioners, in order to make it more effective in pursuit of tax defaulters who have ignored all reasonable attempts to collect taxes in default and to improve efficiencies in certain circumstances.

When attachment was introduced in 1988, attachment of emoluments was not regarded as necessary by reference to the circumstances that prevailed at the time. However, circumstances have changed since, and many persons now carrying on trades or professions also derive emoluments from directorships and from employment. In addition, certain persons carrying out trades and professions have ceased those activities, leaving undisputed tax liabilities unpaid. Where these people have directorships or employments, it is appropriate that they should meet their tax debts of previous and current years, whatever the sources of their resources. Where this is not done on a voluntary basis, it is appropriate that the Revenue Commissioners have the use of attachment procedures where necessary to cover these debts. These procedures are only used by the Revenue Commissioners when all normal collection attempts have been ignored by the taxpayer.

If the Senators' recommendations were accepted, it would mean the Revenue could not attach the salaries of well paid individuals with significant entrenched tax debts. It would also mean that individuals who have ceased trading but who are in well paid employment and who, in spite of all reasonable efforts by the Revenue, have not engaged seriously in respect of the payment of tax and have substantial tax liabilities unpaid, can effectively ignore Revenue for very long periods. Given the need to ensure that all tax legally due to the Exchequer is collected in order to maximise tax revenues, I consider it only right that the Revenue Commissioners have the use of attachment procedures in these circumstances. Therefore, I cannot accept the recommendations.

Senators raised a number of points. The 1988 Act applied to assets. The question has raised as to whether there is any appeal. An appeal is available to everybody through the Revenue appeals office. That exists for these circumstances as well. The Bill expands the opportunities for the Revenue Commissioners, but it is only for last resort.

Where does it state that it is only as a last resort?

The Minister of State, without interruption.

It only occurs where people have practically ignored the Revenue Commissioners. It only moves forward on the involvement of a principal officer or appointed assistant principal officer, and in circumstances where the Revenue Commissioners are aware of substantial income being available and people not meeting their liabilities.

The Minister of State refers to people who ignore the law, but that is why we have courts in this country. For the Revenue Commissioners to determine the law and its enforcement mechanism is entirely inappropriate in respect of what is provided for here. It is an offensive section of the Bill. It is unqualified. There are no safeguards. To suggest that an attachment notice would be issued by an official no more junior than a principal officer provides no justification for it.

For a provision like this to be constitutional, it must be necessary. I cannot see how the Minister of State has set out the case. It has to be proportionate and I do not see how that is the case either. The provision gives an absolute power to the Revenue Commissioners on top of the powers that they already have. There is no reason set out that could justify it. It can have the effect of destroying someone's livelihood without any mechanism for that person to prevent that happening. If it was ordered by the court, then it would be an appropriate procedure to use attachment of earnings, but for this to be done by way of an administrative decision from an official in the Revenue Commissioners is entirely disproportionate and unnecessary. I will be pressing this amendment.

I support what Senator Regan has said and I am not satisfied by the Minister of State's reply. I do not think he answered one element of the question I raised. The whole idea of attachment goes back much further than the 1980s. One can find it in novels by Charles Dickens. It was a feature of the Victorian era in Britain, where earnings and so on were attached. However, that does not matter. These are swingeing powers.

In his reply, the Minister of State gave us a kind of humanised sketch of a series of situations. That may very well be true. There may very well be decent, kind, loving, caring, Christian, Jewish, Muslim or ethical people employed in the Revenue Commissioners. I am perfectly certain there are because I personally know that some of them fit those headings. On the other hand, that is just a little dramatisation. We are here as legislators, not as auditors of a dramatic fantasy of the Minister of State. We must look at the possible applications of this Bill. I have pointed out that there appear to be no limits whatever. The Minister of State has not indicated that there are any limits. I indicated that it appeared to be possible that the entire income of a citizen could be so attached. In other words, the citizen would be left with nothing on which to live or to support his or her family. The Minister of State has not said that there are any limitations. He did say that there was recourse to a Revenue appeal. I have no doubt there are principled officers who are given this unusual and onerous responsibility, as suggested by my colleague Senator Harris. I thank him for that rhetorical flourish but there is a good and substantial point underneath the rhetoric. It is a huge responsibility, particularly if it means extinguishing the entire income of a citizen. Why do these powers need to be so extraordinary if the people operating them are of such a sensitive nature that they will never require the full armoury provided by this legislation?

I would like the Minister to explain the following point to me. I do not want any little playlets, just a reply to the point. Is it possible, even theoretically — until it is applied this law is theoretical — that in its application this section could envisage, contemplate and bring about the removal of the entire income from a citizen? That is the principal question I would like to ask. I will not muddy the waters and invite further excursions into the imagination on the part of the Minister. I would just like him to answer that question. Is it possible that under this proposal the entire earnings of a citizen could be removed?

I want to make two points. We pick up our newspapers day after day and see that it has taken three years for the State under the Criminal Assets Bureau to get attachment of Mr. Gilligan's property. It has to go through all sorts of hoops to do that. Any professional body, say, the Medical Council, that wants to strike off or deprive somebody of his or her salary must go to the High Court to get approval for that decision, and it is the same for almost every professional body. If the Law Society of Ireland wants to deprive somebody of his or her salary, after taking the decision it must get it endorsed by the High Court. I could give other examples closer to home with which we have been dealing in recent times.

The idea that an official can decide he or she has reached the last resort and has dealt with all the issues without having to explain himself or herself to any outside body is outrageous. I believe this measure will be tested and I do not believe it will sustain a challenge. I do not believe it is sound. Obviously, the Minister of State is not for turning on it but he must see this as I do. When we consider what one must go through to attach someone else's property, I cannot understand how it can be done in this legislation.

To save the Minister of State repeating himself, I agree with everything he said in the example he outlined. Nobody is arguing about that. We have all said that. If there is tax owing it must be got. We want to give proper powers to the Revenue Commissioners but we are saying these powers seem not only excessive but perhapsultra vires and questionable constitutionally. That is my last say on the matter. I hope the Minister of State will respond to some of those points. If he does not, I cannot do anything about it.

If a case is successful it will cost the State more money.

I too support Senator Regan's recommendation, and my colleagues have spoken eloquently about this issue. We live in dangerous times. Because the country finds itself effectively in an economic state of emergency there is a temptation at times such as these to take draconian measures, just as there is a temptation at a time when people are frustrated with the workings of the Oireachtas, for example, to make simplistic arguments about abolishing one House of the Oireachtas. It is at times like this that we must be especially careful. As Senator O'Toole and others have said, we have our courts for a reason. We have the separation of powers for a reason and it is not appropriate to provide for this kind of power to reside within the Revenue Commissioners. In providing for the power of attachment I wonder why the Minister does not go the whole hog and provide for the power of committal while he is at it. The separation of powers exists for a reason.

We are talking about something as fundamentally important as people's livelihood, and we are all equal and united in our disapproval of those who evade tax and united in our desire to see the Exchequer garner and collect all to which it is entitled, but that does not mean we abandon all responsibility in the mechanisms we create and tolerate for the achievement of that goal.

This is yet another example of how wrong-headed it was to run this legislation through this House in such a short period of time. There is something substantially wrong in this measure. It deserves to be properly considered. It deserves to be the subject of an amendment, put and voted on. If right were right, the Government would see the sense in this proposal and it would go back to the Dáil this evening by way of a recommendation where we would not just have apro forma exercise in the Dáil but a solid recommendation from the Seanad being accepted by the Dáil later. That is if right were right but right is not right at the moment. I ask the Minister of State to reconsider before going ahead with this most unsound piece of legislation.

I am assured by the Revenue Commissioners that they will have full regard to taxpayers' financial circumstances when using this power. It is to be noted that the section provides that the attachment, where used, may provide for the recovery of taxes over a period so as not to cause undue hardship to the taxpayer.

Where does it say that?

The Revenue Commissioners will draw up strict guidelines on the use of attachment——

This is an afterthought.

Please, no interruption.

The Minister is not addressing the argument.

The Senator will have an opportunity to come back in to speak.

I will get around to Senator Norris's question shortly. The Revenue Commissioners will draw up strict guidelines on the use of attachment on the same basis as the existing guidelines that apply to attachments generally.

The Minister is shutting the stable door after the horse has bolted.

Please, Members.

For a moment I felt that perhaps people are in support of tax defaulters. Certainly, I am not and——

We made it clear, Minister.

Some of the arguments might be inclined to lean towards that.

That is most unfair.

The provision is not intended to replace the current practice of recovery of small tax underpayments from PAYE employees by means of adjusting tax credits etc.

The question of constitutionality has been raised. As is the case in every item of legislation, including this Finance Bill, its provisions have been thoroughly investigated by the Attorney General and his staff and are deemed to be totally in line with the Constitution. I want to put that on the record. There are no constitutional issues involved. It must be noted that what we are talking about here is a means of last resort. We are talking about people who have evaded or attempted to evade to pay their taxes over a long period. They have adequate income but they have attempted to evade paying their taxes. That is the purpose of this measure.

I wish to make a number of other points, in particular the one raised by Senator Norris.

I am sorry but the Minister is characterising me wrongly.

The entire income——

What I asked was whether the entire income could be attached.

The Minister is replying.

He is not replying to what——

Wait for the Minister to reply.

It is not the case that the entire income of anybody would be taken. It is the case that where there is income, and indeed adequate income, the Revenue Commissioners would work out over a weekly, monthly, two monthly or six monthly basis the returns that should be made, in line with the income of the person concerned, provided he or she can afford it.

I ask the Minister to point out where that is stated in the legislation.

That is in the legislation, and that is what the guidelines will be on this item of legislation.

That is an insult to the House.

There is also the position that to some extent has been portrayed here that there is no appeal system. Everybody knows there are two appeals commissioners in this country. They are not appointed by the Revenue Commissioners; they are appointed by the Government. They have a quasi-judicial position and people have an entitlement to go to them. If they are unhappy with that, they have a further entitlement to go to the courts of the land. That is available under this Finance Bill as well. It is important that is put on the record of the House.

These defaulters are not people who are pounced upon. They are people who have consistently and deliberately not engaged with the Revenue Commissioners in terms of meeting their tax liabilities and who have adequate income to pay them. That is the type of people about whom we are talking. It is highly appropriate that somebody who has taxes liable to the State, through the Revenue Commissioners, and can afford to pay them should pay them, even if it is over a period.

Nobody is disagreeing with that.

No interruptions.

Senator Norris made the point about legislation being in place in advance of 1988. I accept there is legislation in place going back perhaps 100 years but that is to do with debt and I am not talking about debt. I am talking about tax due to the State.

That is a debt.

It may be the case that there are other areas of private debt but this is tax due to the State.

It is appropriate in these times, and indeed at any time, that people who are due to pay their taxes and have adequate income to pay them should do so. There is existing legislation for attachment. The provision is inserted into the overall legislation. The counterbalance to the Revenue Commissioners exists in the courts. There is no question of this involving someone's total income being taken away. I totally refute that here on the floor of this House.

This will be my last comment. The Minister of State broadly stated that no one's entire income will be taken. I challenged him repeatedly to point to a place in the legislation where this is made clear. Perhaps this is possible, either in this legislation or in other legislation. So far he has not done so. Perhaps he will.

It is a debt. My colleagues are quite correct to raise the spectre of the debtors' prison. The Minister of State suggested we on this side of the House were in support of tax evasion. I ask him to withdraw that. Every one of us in sequence has stated clearly in this House that we all believe it is appropriate that people should pay their taxes. As far as I am aware, we all do. Certainly, I make strenuous efforts to pay every last penny.

He then stated this is a matter of last resort. That may be the case in practice to date but we have never had experience of the operation of this legislation. Nothing in this section or elsewhere states that this is a weapon of last resort or that it can only be used against persistent, deliberate and calculating tax evaders, which is what the Minister of State said, but there is nothing in the legislation that specifies that.

I am disappointed. I know the Minister of State of old. I remember him since he was a Member of this House and a more good-natured and decent person one could not meet. He is assuming that this will be the same as the Revenue Commissioners, as we all do. This legislation makes wide provision and one cannot assume that this will always be the position. If it is the position, why not make it clear in law? Why not make clear it is a last resort for persistent defaulters and all the rest of it and that the basic income necessary to sustain decent human existence will be protected? That is not in the legislation. If, as several of my colleagues have suggested, this is susceptible to a constitutional challenge and if that was successful, then the State will be stuck with another bill.

I fully endorse the recommendation. We all recognise that every earner in the State should pay their due taxes and we on this side of the House agree that no one should tolerate tax evasion of any sort. That strong message should always go out from Government and from the establishment.

However, Revenue officials make mistakes. I am sure the Minister of State will be aware, as I am from experience, of where bad decisions have been made by Revenue. In fairness, the Revenue appeals office plays a role in overturning some of those decisions and it is important it is in place and is working.

The part in this legislation to which we referred seems an attempt by Revenue to take on draconian powers. For example, where a self-employed person is employed by a contractor, if Revenue decides to serve a notice of attachment on that contractor, there is considerable potential to damage the future earnings of that self-employed person and to destroy the livelihood that he or she has always had. Everyone has a constitutional right to a livelihood. It seems that this is draconian. It seems logical that at least any person should have the right of recourse to a court and at least a court order should be sought before any such orders are made in order that the matter could be dealt with properly in the court.

I ask the Minister of State to seriously consider the recommendation. Such strong powers should not be given to Revenue. We all have constitutional rights in this country. The Minister of State has said repeatedly it is a last resort. The last resort is the courts of the country and he should not be handing over such powers to Revenue in this instance.

I reiterate what Senators Norris and Coffey stated, that all of us in this House fully support the necessary powers for the Revenue Commissioners to deal with tax evasion and tax defaulters. Clearly, no one seeks to make excuses or any case for tax evasion or tax default. In the Labour Party, we are very much in favour of rigorous methods being used in accordance with law to deal with tax evasion.

There was a reasonable question. I asked the Minister of State earlier to what extent this recommendation represents an expansion of the powers of Revenue under section 1002 and I did not hear a satisfactory answer to that question. Senators have raised valid concerns about expansion of powers without in any way attempting to speak against Revenue powers to deal with tax defaulters.

The Minister of State's defence of this measure is vacuous. It must be an afterthought to suggest that Revenue will draw up procedures as to how it will implement this measure. We are passing legislation. We should be drawing up the guidelines.

The Minister should be drawing up the guidelines as to how the law is to be applied and we should not be handing over such significant powers to Revenue.

The current provision in section 1002 of the Taxes Consolidation Act 1997 states, "Any amount of money due by the relevant person to the taxpayer as emoluments under a contract of service shall not be regarded as a debt due to the taxpayer", and it is proposed to reverse this in one fell swoop. I still have not seen the justification for it. It is an arbitrary power that we are handing over and it makes for bad legislation.

First, I want to clear up one matter for the benefit of Senator Coffey. This does not apply to the self-employed. This applies to company directors and their employees who in many cases wind up with substantial salaries and have a debt left from another time which they refuse to meet. It is important that Senators understand about whom and what we speak.

There is no question of this being draconian in so far as there is not an appeals system. There is an appeals system through the Revenue appeals commissioners. They are appointed not by Revenue but by the Government. That appeals system exists and if anyone is unhappy with that, he or she has recourse to the courts. It is important that position is well known and recorded here in the House.

By and large, these tax returns due are agreed tax returns. The point is that they are not paid and are dragged out over a period. This amends what was in the 1988 Act, in which assets were involved, to extend it to income and emoluments. That is all that is involved here. It is a practical step for the State to successfully collect taxes due to it from persons who can afford to pay them. The balance is important in so far as the same opportunity is available to the people in question to go to the Revenue Commissioners who have a quasi-judicial role or to the courts if they are unhappy with that.

I am not in a position to accept the recommendation. These are persistent persons who have consistently refused to pay after all the efforts by the Revenue Commissioners. We all have responsibilities to pay our taxes. Where there is a group which found what I might call an opportunity of not paying them, we should not leave that opportunity there for them to continue not paying them. That is what this attachment is about.

Question put: "That the words proposed to be deleted stand."
The Committee divided: Tá, 27; Níl, 23.

  • Boyle, Dan.
  • Brady, Martin.
  • Butler, Larry.
  • Callely, Ivor.
  • Carroll, James.
  • Carty, John.
  • Cassidy, Donie.
  • Corrigan, Maria.
  • Daly, Mark.
  • Dearey, Mark.
  • Ellis, John.
  • Feeney, Geraldine.
  • Glynn, Camillus.
  • Hanafin, John.
  • Leyden, Terry.
  • McDonald, Lisa.
  • Mooney, Paschal.
  • Ó Brolcháin, Niall.
  • Ó Domhnaill, Brian.
  • O’Brien, Francis.
  • O’Donovan, Denis.
  • O’Malley, Fiona.
  • O’Sullivan, Ned.
  • Ormonde, Ann.
  • Walsh, Jim.
  • White, Mary M.
  • Wilson, Diarmuid.

Níl

  • Bacik, Ivana.
  • Bradford, Paul.
  • Burke, Paddy.
  • Buttimer, Jerry.
  • Cannon, Ciaran.
  • Coffey, Paudie.
  • Cummins, Maurice.
  • Donohoe, Paschal.
  • Fitzgerald, Frances.
  • Hannigan, Dominic.
  • McCarthy, Michael.
  • McFadden, Nicky.
  • Mullen, Rónán.
  • Norris, David.
  • O’Toole, Joe.
  • Phelan, John Paul.
  • Prendergast, Phil.
  • Quinn, Feargal.
  • Regan, Eugene.
  • Ross, Shane.
  • Ryan, Brendan.
  • Twomey, Liam.
  • White, Alex.
Tellers: Tá, Senators Camillus Glynn and Diarmuid Wilson; Níl, Senators Maurice Cummins and Eugene Regan.
Question declared carried.
Recommendation declared lost.
Section 74 agreed to.
Sections 75 and 76 agreed to.
SECTION 77

I move recommendation No. 10:

In page 219, line 1, after "officer" to insert "not below the rank of principal officer".

Another power for Revenue is being introduced here. I draw the Minister's attention to the definition of Revenue officer which includes serving and former officers of the Revenue Commissioners. My amendment relates to section 77(7), under which a Revenue officer may disclose personal information to a professional body where he or she is satisfied the work of an agent does not meet the professional standards of a professional body. It is provided that a Revenue officer of any rank can lodge a complaint with a professional body about a tax adviser, tax agent or otherwise.

In discussing the previous amendment the Minister said one of the safeguards was that an attachment notice would be issued by a principal officer or an officer of a higher grade. There is no such safeguard in this regard. Therefore, I propose that any such complaint by a Revenue officer would be made by a Revenue officer not below the rank of principal officer. This is a necessary safeguard, particularly in the light of the definition of Revenue officer. The facility that anyone in Revenue is in a position to lodge a complaint is open to abuse, if not subject to some supervision and approval at a higher level within the Revenue Commissioners.

I support Senator Regan's recommendation. In its report for 2000 the Committee of Public Accounts discovered there was a problem with the relay of information from different groups. The legislation at the time was interpreted to mean that the Central Bank could not share information with the Revenue Commissioners and that the Revenue Commissioners could not share it with the Garda. When I chaired the Government audit review group in 2002, we asked for changes that would allow such information to be shared. The matter was dealt with in the Companies Act 2003, by way of a section dealing with confidentiality. While that legislation allows sharing to take place between the bodies mentioned, it also neutralises it by putting in place a requirement for confidentiality. This deals with professional bodies — I presume we are talking about the accountancy bodies. As I am a member of the board of the Irish Audit and Accounting Supervisory Authority, I have an interest in the matter.

An issue that arises is that in the investigation into Anglo Irish Bank there may well be information in the Revenue Commissioners that would be useful to the Director of Corporate Enforcement or the professional body or both. I recognise that we must deal with the matter as we find it, but the point raised by Senator Regan is crucial; such a licence must be controlled. If we are to have it, it should be done by someone of senior rank. Ten minutes ago the Minister of State indicated the previous measure which we opposed would only be operated by someone at principal officer or assistant principal officer level in the Revenue Commissioners. It is to get the same assurance that the issue is being raised and that is why I support Senator Regan. We all agree there should be a flow of information; in this instance we are saying how it should happen and seeking to apply what the Minister of State said ten minutes ago, that it would be done by someone at principal officer or assistant principal officer level.

The Minister of State pointed to a safeguard earlier where approval by a principal officer or above was required at Revenue before powers could be exercised. I note in section 74(c) that a new provision is to be inserted, referring to an officer of specific rank within the Revenue Commissioners, whereby “authorised officer” means an officer of the Revenue Commissioners authorised in writing to exercise the powers conferred by the section. Even if the Minister of State is not minded to accept Senator Regan’s amendment, another safeguard could be inserted to at least require that before an officer of the Revenue Commissioners could exercise this power, he or she would have to be authorised in writing to do so or else be of a specific rank or above. It is not that we oppose the giving the powers to the Revenue Commissioners, rather we want to ensure due process is observed and sufficient safeguards are in place. The safeguard proposed by Senator Regan is eminently sensible and accepted in principle in respect of other Revenue powers.

Some of the issues raised by my colleagues are met in the opening lines of section 77 dealing with definitions. Some of my colleagues have asked what an agent and a professional body are. They are defined and tend to be in the area of auditing, accounting and taxation services. That has been answered, although not perhaps by the Minister. I am sure he would have drawn our attention to this, but it is in a previous part of the Bill. However, I share the concerns of my colleagues about the seniority required of the person. There is no indication whatever in the legislation of the seniority required. If I understand the section correctly — perhaps I do not — anybody, down to a fairly junior level, could make this disclosure. There is a question of the integrity of information. I suppose this is a side issue, but a situation arose recently which has caused great concern, where ten or more computers were removed from the premises of the Revenue Commissioners in Dublin. People are very concerned about the release of sensitive information in inappropriate circumstances. This recommendation contemplates circumstances where it would be appropriate and where it would be——

As it is now 4.30 p.m., in accordance with the order of the House, the question shall be put on No. 1, the Finance Bill 2011, dealing with Parts 4, 5 and 6 of the Bill, sections 68 to 84, Schedules 1 to 3, inclusive, and the Title.

C'est la guillotine.

As it is 4.30 p.m. I am required to put the following question in accordance with an order of the Seanad today: "That recommendation 10 is hereby negatived, that in respect of each of the sections, 77 to 84, undisposed of, that the section is hereby agreed to in Committee, that Schedules 1, 2 and 3 and the Title are hereby agreed to in Committee and that the Bill is, accordingly, reported to the House without recommendation."

Question put.
The Committee divided: Tá, 29; Níl, 22.

  • Boyle, Dan.
  • Brady, Martin.
  • Butler, Larry.
  • Callely, Ivor.
  • Carroll, James.
  • Carty, John.
  • Cassidy, Donie.
  • Corrigan, Maria.
  • Daly, Mark.
  • Dearey, Mark.
  • Ellis, John.
  • Feeney, Geraldine.
  • Glynn, Camillus.
  • Hanafin, John.
  • Harris, Eoghan.
  • Leyden, Terry.
  • McDonald, Lisa.
  • Mooney, Paschal.
  • O’Brien, Francis.
  • O’Donovan, Denis.
  • O’Malley, Fiona.
  • O’Sullivan, Ned.
  • Ó Brolcháin, Niall.
  • Ó Domhnaill, Brian.
  • Ormonde, Ann.
  • Quinn, Feargal.
  • Walsh, Jim.
  • White, Mary M.
  • Wilson, Diarmuid.

Níl

  • Bacik, Ivana.
  • Bradford, Paul.
  • Burke, Paddy.
  • Buttimer, Jerry.
  • Cannon, Ciaran.
  • Coffey, Paudie.
  • Cummins, Maurice.
  • Donohoe, Paschal.
  • Fitzgerald, Frances.
  • Hannigan, Dominic.
  • McCarthy, Michael.
  • McFadden, Nicky.
  • Mullen, Rónán.
  • Norris, David.
  • O’Toole, Joe.
  • Phelan, John Paul.
  • Prendergast, Phil.
  • Regan, Eugene.
  • Ross, Shane.
  • Ryan, Brendan.
  • Twomey, Liam.
  • White, Alex.
Tellers: Tá, Senators Camillus Glynn and Diarmuid Wilson; Níl, Senators Maurice Cummins and Eugene Regan.
Question declared carried.

In accordance with the order of 28 January 2011, Report Stage will be taken now.