The Gazette 1992

GAZETTE

JUNE 1992

N W E S Taxation Committee attacks Draconian Measures in Finance Bill

In a recent press statement the Taxation Committee criticised measures in the Finance Bill 1992 and called on the Minister for Finance to reconsider them. The text of the statement was as follows: " The Taxation Committee of the Law Society welcomes the decision by the Minister for Finance, Bertie Ahern TD, to defer for one year the provision in the Finance Bill which would require companies and professionals to give information to the Revenue Commissioners about the transactions of third parties, but calls on him to reconsider this and other provisions in the Bill which give swingeing and sweeping powers to the Revenue Commissioners. " The self-assessment system was introduced with the cooperation of professional bodies with the intention of alleviating the burden and cost to the compliant taxpayer in accordance with the Taxpayers Charter. It is clear that without this cooperation the system would not operate and it has been admitted that over 90% of personal taxpayers have submitted their returns and paid their due tax. " The Law Society is in favour of measures aimed at eliminating tax evasion. It is clear, however, that the compliant taxpayer and his advisers will bear the brunt of this legislation. This makes nonsense of the self-assessment system and places an insurmountable obstacle in the path of professional cooperation. " I t was noted in the newspapers of the weekend of 9/10 May that multinational and foreign companies which had set up business in Ireland were beginning to view with alarm recent developments in revenue law and practice in this State.

Professional advisers must now warn their business clients that the business climate in this country is becoming oppressive and anti- enterprise. Responsibility for this lies solely with the Government as they appear to accept, without question, Department of Finance and Revenue authority initiatives, in spite of the warnings by responsible business and professional people. "As identified in the Culliton report, it is small business on which much of the future economic development of this country depends. It has come to the attention of the Law Society that many small businesses may be intimidated into increasing their tax liability following a Revenue audit. businessman may be forced to make a commercial decision balancing the additional amount "claimed" by the Inspector against the loss of profits and other costs involved in defending his position. The Revenue Commissioners are aware of this and, in some instances, use it to their advantage as they are not subject to the same commercial constraints. "Against this background, the Finance Bill introduces swingeing and sweeping new powers for the Revenue Commissioners. Due to the unprecedented scale and severity of these measures, the Government has been requested to postpone their implementation, encompassing as they do: 1. Powers reserved to an authorised officer of the Revenue The Law Society views this development with alarm. The Commissioners to arrest without warrant in relation to VAT. (S. 189) 2. Powers reserved to a member of the Garda Siochana accompanied by an authorised officer, to arrest any person without warrant for obstructing the authorised officer. (S. 236)

3. Powers reserved to an authorised officer to enter business premises and to search for and seize documents, without warrant. (S. 232) 4.- Powers reserved to an authorised officer, on a warrant, or in certain circumstances without warrant, to enter the home of the taxpayer and to search for and seize documents. (S. 232) 5. Requirements on professional advisers to voluntarily surrender confidential information relating to clients (now deferred for one year). (S. 226) 6. Many other powers of physical and legal enforcement unacceptable in a democratic society. " The Law Society and other bodies have offered assistance and cooperation to the Minister, the Department of Finance, and the Revenue Commissioners in considering these provisions. This offer received no response. "These provisions in the Finance Bill are incompatible with an orderly and democratic society. The Minister should think again." •

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IRISH WHEELCHAIR ASSOCIATION

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