Wednesday, 25 September 2019

Ceisteanna (68, 69, 70, 71)

Joan Burton

Ceist:

68. Deputy Joan Burton asked the Minister for Finance the estimated increase in the number of high net worth individuals dealt with by the Revenue Commissioners' large cases division if the threshold for inclusion was reduced to €20 million; the additional resources that would be required to provide for such a reduction; if such resources will be made available to the Revenue Commissioners; and if he will make a statement on the matter. [39073/19]

Amharc ar fhreagra

Joan Burton

Ceist:

69. Deputy Joan Burton asked the Minister for Finance the estimated increase in the number of high net worth individuals dealt with by the Revenue Commissioners' large cases division if the threshold for inclusion was reduced to €10 million; the additional resources that would be required to provide for such a reduction; if such resources will be made available to the Revenue Commissioners; and if he will make a statement on the matter. [39074/19]

Amharc ar fhreagra

Joan Burton

Ceist:

70. Deputy Joan Burton asked the Minister for Finance the number of new cases added to the high net worth individuals’ unit in the Revenue Commissioners' large cases division in each year since the unit's formation in 2003; the number of cases dropped and moved to other units of the Revenue Commissioners; and if he will make a statement on the matter. [39075/19]

Amharc ar fhreagra

Joan Burton

Ceist:

71. Deputy Joan Burton asked the Minister for Finance the estimated additional audit yield if a properly resourced high net worth individuals unit took responsibility for those with net assets greater than €10 million, €20 million and €30 million, respectively; and if he will make a statement on the matter. [39076/19]

Amharc ar fhreagra

Freagraí scríofa (Ceist ar Finance)

I propose to take Questions Nos. 68 to 71, inclusive, together.

Tax administrations generally use assets and/or wealth as their main criteria for defining a High Wealth Individual (HWI), while some also include income criteria. I am advised by Revenue that its criterion to be considered a HWI and to therefore come within the remit of the HWI branches of its Large Cases – High Wealth Individuals Division (LC-HWID) is individuals with net assets of €20 million and over.

I am advised by Revenue that as there is no statutory obligation on individuals to return details of their net worth on returns of income it is not possible to estimate the number of individuals with a net worth within the thresholds requested by the Deputy.

Revenue has had a focus on HWIs over a long period. HWIs have been managed by dedicated units within its Large Cases Division since it was established in 2003. Revenue split its Large Cases Division into two divisions in 2018, one of which, LC-HWID, has a focus on HWIs, avoidance and pensions. As reflected in one of the recommendations in the Annual Report by the Comptroller and Auditor General (C&AG), the new Division reviewed the case base with a view to increasing the number of HWIs it manages. This review has been published on the Revenue website, www.revenue.ie, and provides more detail on the criteria used by Revenue to identify taxpayers with net assets falling within the revised threshold.

The allocation of resources is a matter for Revenue but I understand that Revenue’s structural realignment, of which the setting up of the LC-HWID was a part, was supported by an expansion in the number of specialist and experienced staff assigned to the oversight of the new Division’s case base. The number of staff currently assigned to the HWI branches is c.60. I also understand that Revenue established a new Division, the Medium Enterprises Division, to manage the affairs of the tier of cases, both corporate and individuals below that of the Large Cases Divisions.

I am advised by Revenue that the HWI case base is adjusted periodically but not necessarily on an annual basis. The following Table provides the number of cases in the HWI case base for the years indicated:

Year

Number of HWIs

2004

250

2006

300

2017

571

2018

480

2019

955

I am satisfied that the structural realignment by Revenue combined with the risk focused approach to compliance management, will continue to deliver an outcome where HWIs pay the appropriate tax in accordance with the legislation. I am advised by Revenue that it is not possible to estimate additional audit yield related to cases recently coming within the responsibility of LC-HWID. There is a presumption of honesty by taxpayers who pay on a self-assessment basis and no category of taxpayer would be regarded, in advance of a case appraisal, as likely to give rise to audit yield. All taxpayers are subject to risk evaluation and intervention as appropriate so bringing a particular category of taxpayers within the remit of the LC-HWID would not, of itself, be a determinant of an increased audit yield. Revenue’s overall approach to managing compliance is to make the appropriate intervention following appraisal of the risk factors in each case.

Finally, I would like to say to the Deputy that over the last number of Budgets I supported the business case put forward by Revenue in relation to additional resources, both personnel and ICT, and I will continue to examine any proposal put forward by Revenue in the future.