Tax take from the super-rich is down by two-thirds
THE financial woes of the Celtic Tiger's super wealthy -- the likes of Sean Quinn, Barry O'Callaghan, of Riverdeep, and builders Bernard McNamara and Liam Carroll -- have taken a massive bite out of the state tax coffers.
The amount of tax collected from the country's wealthiest individuals is now a third of what it was in 2007 -- when the Irish property market started to collapse.
In 2007, the unit set up by the Revenue Commissioners to monitor the tax affairs of the super-rich collected €288m in taxes. However, the tax take from this wealthy elite plummeted to €97m in 2009. The team, known as the "high-wealth individuals business unit", collects tax from people worth more than €50m, as well as non-residents with "substantial economic interests" in Ireland.
People like Mr Quinn, Mr O'Callaghan, Mr McNamara and Mr Carroll were worth hundreds of millions of euro before the crash.
"By and large, the drop is down to property," said Breda Ruddle, principal officer with Revenue's high-wealth unit. "The tax that has completely gone down is capital gains tax -- which is related to the buying and selling of property."
In 2009, only €20m of capital gains tax came from the super-rich, said Ruddle, compared to €206m in 2007.
The high-wealth unit is part of Revenue's large cases division, which was set up in 2003 to deal with the tax affairs of large corporates, the financial services sector, motor distributors -- and the super-rich.
The overall tax take of the large cases division has fallen by 10 per cent since 2007 (from €20.3bn to €18.2bn).
"In the good years, the super-rich put their money into property, stock and shares," said Donall Gannon, tax partner with KPMG. "A lot of tax was collected when these high earners sold shares, or bought and sold property. Unfortunately, much of this wealth has disappeared."