Tuesday 25 October 2016

Offshore tax cheats to be targeted under State's new plan

Published 12/10/2016 | 02:30

Tax cheats who stash money overseas won't be able to dodge their way out of a prosecution under Government plans.

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Finance Minister Michael Noonan said he would introduce a new "strict liability" criminal offence to facilitate the prosecution of serious cases of offshore tax evasion.

And he said the Revenue Commissioners would get an extra €5m to recruit 50 extra staff and additional investments in systems and equipment.

"The release of the so-called 'Panama Papers' earlier this year showed how defaulters use offshore structures and accounts to avoid paying tax," Mr Noonan said.

"International developments and agreements are leading to the better sharing of information."

Mr Noonan also said that the 12.5pc corporation tax rate will not be changed and "nobody is asking for it to be changed".

The minister also said that a promised review of corporation tax code would be carried out, with UCC economist Seamus Coffey being appointed, as an independent expert, to conduct the review.

It was announced in the wake of the Apple decision.

"Today I am publishing an update on our International Tax Strategy that shows the progress that we have made over the past 12 months and highlights how our corporate tax regime meets the highest standards in tax transparency.

"It restates our commitment to meeting new international tax principles and demonstrates how we will ensure our corporate tax regime remains fair but competitive in the future."

The minister also signalled that there would be further tightening of controversial tax rules.

Finance Minister Michael Noonan announced amendments to the Section 110 regime in September, which allows certain types of investment companies to escape normal corporation taxes.

"When this section was introduced, the intention was that it would benefit the Financial Services industry, and it has done so," Mr Noonan said yesterday.

"It is now being used in relation to property in a way that was never intended.

"I have published draft amendments to Section 110, to address these unintended uses. I am aware that further amendments are necessary to address other issues arising in relation to funds and property. I will publish these in the Finance Bill after appropriate consultation has taken place."

But Oxfam Ireland said the Budget was a missed opportunity to tackle tax dodging.

"This budget was a real opportunity for Ireland to put its house in order," said Jim Clarken, Oxfam Ireland Chief Executive.

"While we welcome the announcement that the Government is planning interventions against individuals engaged in offshore tax evasion, it is hugely disappointing that no new mechanisms were announced to stop tax dodging by multinational corporations that negatively affects poorer countries and to increase tax transparency."

Irish Independent

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