Dáil Éireann Debate, Tuesday - 17 February 2004
96 Mr. P. McGrath asked the Minister for Finance his views on the apparent difficulties of the Revenue Commissioners in obtaining evidence to prosecute persons who defaulted on the fines of the tax amnesty and to prosecute officials within financial institutions who gave assistance to persons secreting money into bogus non-resident accounts. [4832/04]
Amharc ar fhreagraI am informed by the Revenue Commissioners that it has not been possible in any cases examined to date to obtain the evidence necessary to meet the required standard of "beyond reasonable doubt" in amnesty non-compliance offences. It is generally the case also that where a taxpayer agrees to co-operate in an investigation and Revenue cannot otherwise access relevant evidence, the taxpayer's rights against self-incrimination will restrict the potential for a prosecution.
I would, however, also remind the Deputy that apart from the amnesty aspect, Revenue has recently been successful in collecting outstanding tax and interest and in imposing civil penalties on many tax evaders in its ongoing investigations. Individual tax evaders have made considerable retribution for their offences as a direct consequence of the large monetary settlements resulting from these investigations.
Revenue's criminal investigation programmes have been re-focused recently with the establishment of an investigations and prosecutions division. If in the course of investigations, amnesty offences are identified and the necessary evidence is available, they will be investigated with a view to taking a criminal prosecution for such offences. On the matter of the prosecution of officials from financial institutions who may have assisted in placing funds in bogus non-resident accounts, the primary responsibility for ensuring that a tax return is correct rests with the individual making that return. There is a statutory offence in the tax code of knowingly aiding or abetting another person to make an incorrect tax return. However, in the case of third parties generally, the standard of evidence required to incriminate them for an alleged wrongdoing by a taxpayer who has failed to declare correct income or gains is very difficult to meet. I understand from the Revenue Commissioners that while, in their experience, aiding and abetting offences are notoriously difficult to prosecute, it would be their general policy to pursue such cases if such evidence became available.
When this tax amnesty was introduced in 1993 the Minister for Finance of the day, who is now the Taoiseach, said he looked forward to the day when tax cheats would be jailed. We heard absolute guarantees that people who availed of the amnesty and were subsequently found to be in breach of it would face the rigours of the law and be pursued to the ends of the earth until they were captured. The inspector of taxes refused two thirds of the 20 people whom the Revenue Commissioners had pursued to establish what they had submitted under the amnesty. Does that not make a laugh of the amnesty provisions passed? Furthermore, can the Minister say why this should be so given the so-called guarantees given at that time and the very stringent penalties for people who availed of the amnesty and did not come clean then? It seems that if someone makes a voluntary declaration Revenue does not even bother to pursue the powers given to it under that amnesty to pursue those people. Hence my previous question asking how many people had been prosecuted under the different sections of that amnesty legislation.
However, the Minister did not answer that question. He ignored it and gave a global answer to ten questions instead. Will the Minister tell us why people are not being pursued? Why does he now say he will continue to pursue them? Is there a ten-year statute of limitations built into the legislation which prevents the Minister from pursuing people who availed of the amnesty?
As I explained in my reply, the level of proof required to obtain a successful conviction under section 9 of the amnesty is evidence beyond reasonable doubt. It has not proved feasible to hear evidence of the standard required to obtain such a conviction. The burden of proof in criminal cases is of the highest standard, that is, beyond reasonable doubt. As regards other aspects of offences where people are convicted, I am sure the Deputy would expect that to be applied by the court. The same applies to criminal prosecutions in tax offences. The tax amnesty legislation in 1993 included an assurance of confidentiality for people dealing with the special collectors. That was enshrined in section 7 of that legislation. As the Revenue auditor or investigator is not permitted access to the declaration made by the person availing of the amnesty, it is not possible to determine whether he or she has been in breach of the amnesty. There are certain exceptions, as the Deputy pointed out, subject to the right of appeal to the appeal commissioners. Less than one third of approximately 20 appeal cases were successful in that regard.
On the question the Deputy asked about this matter, I have seen some newspaper coverage about the ten-year rule. I have been told by the Revenue Commissioners that the legal advice available to them is that there is no time limit on an investigation of indictable offences. The Revenue investigators proceed on that basis. The effect of the passage of time can create evidential difficulties. Until the mid-1990s the Revenue Commissioners did not pursue a specific prosecution strategy. That was left to the Director of Public Prosecutions. That way of doing things was only changed in the mid-1990s.
The Revenue Commissioners got large amounts of money in all the recent investigations. I refer the Deputy to the final report of the sub-committee on DIRT of the Committee of Public Accounts, which referred to the general approach of Revenue in dealing with the role of financial institutions and it was noted that by then the Revenue Commissioners had taken a pragmatic approach.
We have gone over the six minutes for this question. I call Question No. 97.
I did not get an opportunity to ask a second question.
There are six minutes for the question.
You, a Cheann Comhairle, allowed the Minister to continue speaking. This is an important issue. I must be allowed to ask a final question.
In fairness to other Deputies who have submitted questions, there are six minutes for each question.
Yes, but your judgment should protect my rights. I am entitled to ask a second question.
The Chair has no control over the length of a reply. The Deputy wants the facts and figures. The Minister did not take his initial two minutes to reply, but the Deputy took two minutes to ask a supplementary question.
Yes, to which I am entitled.
The Minister took two seconds over the two minutes to conclude. In fairness to other Deputies, if I allow you -——
There should be time left.
It is a matter for the House to change Standing Orders under Dáil reform.
I am disappointed.
I appreciate that.
The Minister indicated that the Revenue Commissioners are not following up tax evasion under this Bill. The commitments given in 1993 amount to nothing. This is important.
I call Question No. 97. In fairness to other Deputies in the House, we must apply the Standing Order to each Deputy.
