The Gazette 1975

privilege of his client. That privilege was built up for good reasons over many years. If someone commits murder and consults with a solicitor and discloses what he has done on the course of his consultation with his solicitor, I assume the Minister does not believe that the solicitor should there and then report the matter to the Garda. The position in this regard has been built up over centuries with the experience of what can happen. The proposition that a solicitor who receives information in the course of his professional duties is obliged to hand over that information to the authorities is a most dangerous pro- position. This is the thin end of the wedge. Without this sec- tion the information sought could not be obtained by the Revenue Commissioners. The Minister seeks to justify it on the grounds that we are all against aiding tax avoidance. We are all against a great many other things too and yet the privilege of a client who consults his solicitor is preserved in law, and is jealously pre- served. This section is taking away rights which exist in regard to the relationship of a client to his solicitor. It is taking them away and whittling them down. It will be ex- tended further if this is allowed to go on. The Minister may talk about the position in Britain. The Minister is devising a formula here for the hothouse growth of such kinds of activities in this country. He is driving people into that position. That is precisely what will happen. He will get no information of any value what- ever from this section. He will create a situation in which people will not go to their solicitor, or their accountant, or their bank, and the Revenue Commis- sioners will know far less about what is going on than they do at the moment. They will be far less effective in getting after such people. It will go totally under- ground with a number of undesirable consequences flowing from it. The Minister should know of some of the things that have happened in Britain as a result of this kind of legislation. He will have to reconcile himself to the fact that, in this perennial battle between those who are trying to avoid liability for tax and the Revenue Com- missioners, there are no final victories. It goes on and on. If the Minister pushes the situation too far, as I believe he is doing here, he is so altering the ground rules that these people are getting out from under the ken of the Revenue Commissioners. If it is not pushed too far the Revenue Commissioners can at least become aware of what is happening and close the loophole. People will open further loopholes, but that is getting more and more difficult. When you try to get informa- tion which is of no use to the Revenue Commissioners anyway by undermining the relationship between a client and a solicitor, as is being done here, all you are doing is driving the whole thing completely out of the ken of the Revenue Commissioners. You are losing out on a number of scores, and what have you got to show for it? A section which says the names and addresses of people involved in those transactions are to be given to the Revenue Commissioners by the solicitors con- cerned. Is this rational? Is this a real approach to this matter? Is the Minister seriously suggesting that this section

will aid in any way the efforts of the Revenue Com- missioners to get at people who have indulged in tax avoidance? Does the Minister not know that these pro- visions are totally ineffective in so far as they relate to people who do not want to be caught? He must know that from his own experience and, if he does not, then if he consults with some of his former professional col- leagues, they will tell him very quickly what is happen- ing. This is totally ineffective but there is a price being paid for this ineffective result, a price which could be very high in the future. The price relates to the privilege of a client who consults his solicitor—a privilege which has been preserved over centuries for very good reasons—and if that position is eroded the rights of citizens under the criminal law as well as under the civil law will disappear. To say that it is an exaggeration, may appear to be plausible, but the Min- ister must know that this section is taking away existing rights and if this is allowed to go unchallenged then it will only be a matter of time until it is carried further. If the justification for taking away these rights can be the duty of everybody to assist in preventing tax avoid- ance, are there not very many other far more compel- ling reasons which can be put forward from the point of view of civic duty, far more compelling than that, which would justify further erosion of this position? I would ask the Minister not to take this step on this slippery slope and not to try to justify it by talking about an obligation to assist in combating tax avoid- ance because I can give him ten times more compelling reasons for taking away far more rights and we will then end up with no rights at all. A very dangerous precedent is involved in this section. It is one which has been resisted by many solicitors. It is not being resisted by them because they have any privileges. They have no privilege—it is their clients have the privilege— but they know better than anybody else what this kind of step can lead to in the long run. I repeat that the value of this step to the Revenue Commissioners is minimal but the implications of taking it and attempt- ing to justify it are enormous. I do not want it to happen that this House would allow a section like this to pass without clearly enunciating the dangers involved and resisting this encroachment and the implications of the encroachment. Mr. R. Ryan: I do not share the high moral dis- position some people have in regard to differentiating between evasion and avoidance. Many forms of avoid- ance are no more than operations by the clever to avail of weaknesses in administration or imperfections in the language of the statute to frustrate the clear intention of the Legislature to collect tax arising out of certain profits or capital possessions. I do not think Deputy Colley would deny that. If I am wrong in that conten- tion, why is it that one Finance Minister after another year after year used the Finance Bill to stop avoidance practices? Avoidance is not a transgression of the law but not infrequently it is a brutal bending of the law. It conforms with the law because it slips in between the dot above the "i" and the 'T' itself. Many of the practices of avoidance by means of transferring assets abroad are such as to run so close to evasion as to he properly termed evasion. Indeed, since the 1974 Act obliges people to pay tax on income earned from assets