Mick Wallace will need 87 years in Dail to pay €2.1m tax bill
INDEPENDENT TD Mick Wallace would have to serve as a backbencher for 87 years to repay his €2.1m tax bill.
This emerged last night after the shamed Wexford TD said he would give up half of his Dail salary after a week of public outrage over his company's non-payment of the tax bill.
But there is no chance of the TD being able to repay all the VAT that his M&J Wallace Ltd construction company withheld from the Revenue in 2008.
The Wexford TD did not give the go-ahead to Revenue to discuss his company's tax affairs in public.
Documents from the Revenue had raised questions about whether he had made the disclosure on the failure to pay VAT himself, or if he did it after the Revenue came to audit his firm. He insisted again last night he had disclosed it first to the Revenue.
During his 10-minute speech in the Dail, he apologised to the public, his fellow TDs and to his constituents in Wexford for his "error of judgment" in not handing over the VAT.
"The company understated its VAT liability and we were wrong to do so. I want to apologise and say 'sorry' to all the people who expected more from me," he said.
There is no possibility of Mr Wallace being able to pay back the €2.1m in full using half his Dail salary. His €92,000 salary reduces to €48,000 when tax and the pension levy are taken into account, so the most he can repay to the Revenue is €24,000 annually. And to keep paying, he will have to seek re-election.
Mr Wallace denied that he had made a cavalier comment last week when he stated that his company would not be able to pay back the money.
He is still facing an investigation by the Dail committee of members' interests and the possibility of a motion of censure in the Dail.
Mr Wallace refused to reveal last night if he would give the committee permission to access the Revenue file on the case -- which will otherwise be withheld on the grounds of taxpayer confidentiality.
But he clearly ruled out the option of putting himself before the Wexford electorate in a by-election or quitting the Dail.
"Have I considered resigning and walking away from politics for good? I certainly have. But I've never been very good at quitting," he said.
He attempted to justify his actions as a director by explaining that M&J Wallace Ltd had always paid its taxes for 20 years but had run into difficulties in 2008. He said the company had let staff go but was still not able to pay the VAT.
"There was never an intention that the money that was owed would not be handed over to the Revenue. The motive behind the underpayment was to delay payment in order to trade out of difficulty," he said.
Mr Wallace acknowledged that the Revenue might have dealt with him sympathetically if he revealed his company's cash-flow problems.
But he said that his fear was that if he revealed it at the time, the banks would have put his company out of business.
The Dail heard that the company had been making regular repayments to the Revenue until November last year, when a judgment of €19.4m was obtained against the company by ACC Bank.
Mr Wallace was watched by all the Independent TDs in the Technical group, some of whom had called on him to resign his seat while others had wavered.
Independent Dublin North Central TD Finian McGrath said it was a very emotional and personal speech by Mr Wallace.
"I welcome the fact that he's owned up to everything and that he's making an effort to pay some money back," he said.
Independent Wicklow TD Stephen Donnelly declared he would support a motion of censure against Mr Wallace.
Independent TD Luke 'Ming' Flanagan, who supported Mr Wallace during his speech, admitted he would have had a different attitude if it had been a Fianna Fail politician.
"I suppose I am being a bit of a hypocrite. There's no point denying it. It is that bit more difficult when you do know the person," he said.