The Government is expected to have to provide additional funding to the HSE to meet the cost of a €22.4 million settlement with the Revenue Commissioners in relation to unpaid taxes.
The HSE is expected to tell the Dáil Public Accounts Committee on Thursday this payment will not impact on patient services.
It is understood that money for the settlement with the Revenue will have to come from an an additional €600 million supplementary estimates for the HSE which the Government will propose to the Dáil in the weeks ahead.
The Irish Times reported on Thursday thatthe HSE had reached a €22.4 million settlement with the Revenue Commissioners in relation to unpaid tax in August.
The executive is also expected to tell the Dáil Public Accounts Committee it may have to make a further similar settlement with the Revenue.
A spokesman for the HSE said the health authority had voluntarily disclosed the tax issue to the Revenue following an internal review.
He said the issue related to whether people who had carried out work for the HSE had been contractors or direct employees.
Some of the money related to tax that would have been owed by the health authority itself, while some related to liabilities of others.
The head of the HSE, Tony O’Brien, has told the committee in a written statement in advance of a scheduled appearance before it on Thursday that the organisation, which has about 100,000 staff, has an average annual tax bill of €1.6 billion.
As part of its commitment to continued improvements in internal controls and compliance, the HSE performed a detailed internal review of its tax heads for the years 2011, 2012 and 2013 in order to identify areas of risk in tax compliance.
“The HSE worked within the Revenue’s co-operative compliance programme to submit a formal unprompted qualifying disclosure of all identified underpayment of taxes. “As a result of this process, the HSE and Revenue Commissioners agreed a full and final payment of underpaid taxes including penalties and interest of €22.4 million which was formally accepted by Revenue in August 2015.”
In his written statement to the committee, Mr O’Brien said that payment to Revenue represented less than 0.05 per cent of the overall budget of the HSE for the years 2011, 2012 and 2013.
He said it also amounted to about 0.6 per cent of the overall taxes paid in 2011, 2012 and 2013.
“More importantly, this payment has not impacted on the delivery of services.
“As a result of this tax review, the HSE has set up a tax department which is currently being resourced and developed.
“Further, the HSE is currently in the process of finalising its internal tax review of 2014 which it has formally agreed with Revenue. It is expected that this review will conclude in November 2015,” he said.
“As the tax review of financial year 2011 - financial year 2013 was not completed and submitted to Revenue until Dec 2014 - the HSE are aware that there may be broadly similar issues arising in 2014 and the expectation is that improvements will start to be reflected in financial year 2015 and will continue into financial year 2016.”
