The Gazette 1975

self of it quickly. If we reached the stage where we do not distinguish between evasion and avoidance, in parti- cular if the Minister for Finance does not, we will have reached a stage where somebody vested with authority by the people is trying to say that something which is a breach of the law is in exactly in the same category as something which is not. If the Minister thinks this is highfaluting theorising I will give him air» example which I hope will bring home to him that it is more than that. The Minister recently indicated his inten- tion of taking the EEC Regional Fund and using it in the Exchequer. The Minister may be within the letter of the EEC Directive in doing that but clearly he is in breach of the spirit. I suggest to the Minister that that is a perfect analogy of the Minister engaging in avoid- ance, not evasion. If the Minister's theory is to be accepted, he should be treated as being in breach of the EEC Directive be- cause he is engaging in evasion. I hope that example brings home to the Minister the dangers of the doctrine he is advancing; that it is the same whether one breaks the law or not if, in the view of the Minister for Fin- ance, the things one is doing are equally reprehensible. It is true that some avoidance activities are reprehen- sible. Nevertheless, to try to say that they are to be regarded and treated in the same way as matters which are in breach of the law is a most dangerous doctrine. I want to put it that if this section did not exist the Revenue Commissioners could not, and would not, seek information from solicitors, for example, which they now seek and obtain under this section. If that state- ment is true, then this section is not a restatement of the law. As I said earlier, it is an encroachment on the existing privilege, a privilege which is one of the client, not of the solicitor. Logically, should the privilege not be abolished rather than enable people who are guilty of crimes to be more easily and conveniently convicted by the State? In fact, taking what appears to be the Minister's point of view, the existence of this privilege is unjustified socially in so far as it is a hindrance to the prosecution of offences and in some cases, may indeed assist people in avoiding liability for their offences. That is the logic of what the Minister is saying. The Minister, by train- ing, a lawyer, knows just how important is that privilege to the rights of the citizen and the maintenance of democracy. It extends to a far wider field than this Bill or any matter to do with the collection of taxes and the avoidance or even the evasion of taxes. It is a much more fundamental matter than that. It is one thing if the Minister says : "Look, what is being done here is of minor importance", but if he tries ' to justify what is being done on the grounds that every- body has an obligation to assist in tackling avoidance of tax, then we are getting into much deeper water al- together. When the Minister adds to that some forms of avoidance which in his view are exactly the same as evasion and are to be treated similarly, then the matter becomes more serious. The implications of the Minis- ter's thinking are extremely disturbing. This seems to me to represent a total disregard of the rights of citizens. One cannot justify ignoring the rights of citizens by saying: "Look, we are dealing with people who are avoiding liability." We are dealing with people .221

shyster lawyer, a person who will not comply with the will of the Legislature in this instance. A number of companies will probably start business because they see a profitable venture in being tax advisers. They may even be outside the country, where clients could go to consult them. Those companies would be authorities on particular tax systems throughout the world. I believe as earnestly as the Minister does that people should pay their just taxes but I think it is wrong to state that a person is morally wrong if he seeks ways and means of avoiding tax payments. A lot of the big taxpayers wish that the tax system was as simple for them as it is for the PAYE people who get their wages after tax has been deducted and have no worries, about income tax later on. It is important to stress here that it is not immoral for anyone to seek advice on tax avoidance. The Minister should give further serious consideration to the situation in which he is putting lawyers. They are honest for the most part. We have the good and the bad in every profession but in the main lawyers serve their clients well and they should be encouraged to do so by not divulging what is primarily a matter between the lawyer and his client. Ruairi Brugha: On reading subsection (4) of section 59 of the 1974 Act it seems that the Minister is requir- ing professional organisations or people to provide in- formation. If the Minister requires this, I believe that organisa- tion will cease to carry out the function. It is correct that the Commissioners have the power to require any person to disclose information regarding tax evasion but the argument here is whether it is right for the Minister to give the power to require professional people to dis- close information. Deputy Colley's argument is that that is what is required here. Professional people have to retain the confidence of their clients. How can a solici- tor who has traditionally acted on behalf of his client continue to do that if he also must act on behalf of the State? There is a conflict here which has not been resolved by the Minister. He is acknowledging loop- holes have to be closed and that he is justified in trying to do that from year to year as his predecessor did but he seems to be admitting also in his argument that in order to close the loopholes he is requiring people in a professional capacity to disclose information which is traditionally confidential. If the Minister is not doing that, I do not see any fundamental argument against Deputy Colley's amendment. The power is with the Revenue Commissioners at any time to direct an individual or the responsible officer of any corporation to disclose the information they want. Does the Minister not see a difference between a respon- sible officer or a person who is engaged in activities which the Revenue Commissioners wish to bring to an end and the person who is employed in a professional capacity, a solicitor, accountant or barrister, to advise an organisation, company or an individual? Mr. Colley: Earlier I suggested to the Minister that he should not equate evasion with avoidance but he went on to explain that that is precisely what it does. Mr. R. Ryan: I said it was very difficult in some forms to differentiate between evasion and avoidance. Mr. Colley: I put it to the Minister that that is a most dangerous doctrine and he should disabuse him-