Michael Lowry's firm in ?1.1m tax settlement
EXCLUSIVE
THE company controlled by former Cabinet minister Michael Lowry has made a ?1.12mtax settlement with the Revenue. Figures lodged in the Companies Office reveal that the ex-Minister's company, Garuda, and the taxman struck a deal last year.
The settlement finally puts to bed the questions about Garuda's tax affairs after the McCracken tribunal's probe into its activities in 1997.
Tax assessments were raised against the company after the findings of the tribunal. It is understood that almost ?750,000 of the settlement was made up of interest and penalties.
The agreement with the tax authorities and a healthy 2005 profit have enabled Mr Lowry's company to produce unqualified accounts for the first time since the tribunal's report. Auditors, BBT of Foxrock, Dublin, have given the one-time FG Minister's business a clean bill of health.
The payment of ?1.12m was made possible by a turnaround in Garuda's fortunes last year. The accounts reveal that gross profit nearly doubled in 2005, but that the one-off tax payment takes it into a small net loss.
Garuda's massively-increased turnover from ?3.4m to ?5.9m in 2005 suggests that the ex-Minister is steering the refrigeration business into a pattern of steadily-rising operating profit.
Industry sources say that Garuda is being recognised within the trade as a competent player and that it is already on target for improved numbers in 2006; good commercial contracts have been secured and led to the better 2005 performance. The same sources say that Garuda's network has expanded to include other supermarket groups apart from its traditional links with Dunnes Stores.
The company was able to discharge its tax bill due to a loan of over ?1m made to it by Mr Lowry. It is understood that he was only able to meet this obligation by remortgaging his house in Tipperary together with a personal cash contribution.
And in a separate development, the Sunday Independent can reveal that the man who was once a live prospect for leader of Fine Gael settled his personal tax affairs with the Revenue back in 2003. Revenue sources were tight-lipped about the size of the settlement, but insiders claim that it was between ?150,000 and ?200,000.
Mr Lowry, the poll-topping North Tipperary TD - who has been battling with revenue and business problems ever since the McCracken tribunal reported in 2002 - was present in the Dail chamber last week to hear Taoiseach Bertie Ahern defend thepayments received from businessmen in Dublin andManchester.
The McCracken report heavily criticised the business relationship between Mr Lowry and Ben Dunne and the tax liability owing from this arrangement. However his final report concluded, "Neither Dunnes Stores nor Mr Dunne ever requested Mr Lowry to make any personal or political intervention on their behalf, and Mr Michael Lowry never sought to intervene in any way for the benefit of Dunnes Stores or Ben Dunne. There was no political impropriety on the part of Mr Michael Lowry."
