Taoiseach does not qualify for tax compliance certificate

The Revenue Commissioners will not sign off on the Taoiseach's tax affairs for some time, writes Public Affairs Correspondent…

The Revenue Commissioners will not sign off on the Taoiseach's tax affairs for some time, writes Public Affairs Correspondent Colm Keena

As has already occurred with the late Charles Haughey and the former Fine Gael minister Michael Lowry, the Taoiseach, Bertie Ahern, now finds himself being investigated by a tribunal while at the same time being subjected to Revenue inquiries.

What makes his situation more striking than those two earlier cases, however, is the fact that he is a sitting Taoiseach.

The Revenue, for obvious reasons, would be unwise to sign off on its dealings with Ahern while the Mahon tribunal continues to question him about the large cash transactions he was involved with in the 1993 to 1995 period, and the strange background to his renting and then purchasing his current home.

READ MORE

In the cases of Haughey and Lowry and the inquiries into their affairs conducted by the Moriarty (payments to politicians) tribunal, the Revenue kept a watching brief while at the same time dealing with their tax advisers. In Haughey's case his advisers included the accountant Des Peelo, who is now acting for Ahern.

Some obvious difficulties already exist for Ahern. He has said he was aware when he received money in Manchester in 1994, that it did not create a tax liability as it was a gift from outside the State.

However, he now says he cannot recall who contributed to the gift, so the Revenue cannot satisfy itself that the donors lived abroad.

A more difficult matter arises in relation to the two "dig-outs" Ahern has said led to his being given £22,500 and £16,500 in 1993 and 1994 respectively. He has said he accepted the money only on the basis that the payments were loans that would be repaid with interest.

For this reason he did not declare the payments to the Revenue. He was minister for finance at the time.

In the wake of the initial controversy over the payments in 2006, he said he had repaid the money with interest, paying out €90,867. The tribunal has since heard evidence that many of the cheques sent out as part of this operation were signed on the back and then forwarded to a charity, Cari, with which Ahern's wife, Miriam, is associated.

Some of the cheques, however, were not given to the charity and were never cashed. One of the largest, for €11,829, was sent to the former managing director of NCB, Pádraic O'Connor.

He has never cashed the cheque. Maureen Gunne, widow of the late Fintan Gunne, whom the tribunal has been told made a contribution, has said she also did not cash the €5,914 cheque she received.

The position in relation to another man said to have contributed, Michael Collins, is not clear. He lives in Australia. He was scheduled to give evidence last December, but then was rescheduled to a date to be arranged. It is not known if he cashed his cheque.

The amounts covered by the uncashed cheques remain with Ahern. Furthermore, O'Connor has said in sworn evidence that he never gave a loan to Ahern, or any personal contribution, but rather authorised a payment by NCB towards Ahern's constituency operation in Dublin Central.

The Revenue will now await the completion of the tribunal's public hearings into Ahern's affairs, if not its eventual report, before closing its dealings with Ahern.

As was also the case with Haughey and Lowry, the Revenue's first step when it wrote to Ahern in 2006 was to ask him to fill in an income tax return for the tax year 1994 to 1995. Such a declaration forces a taxpayer to state his or her position in relation to a range of categories of income.

Ahern did sign the form and return it, with an attached statement covering the year concerned. However, the Revenue was not satisfied and asked that he state his position in relation to all of the income categories covered on the form.

The form may have since been completed to the satisfaction of the Revenue but Mr Ahern's overall tax situation will probably remain unresolved until the tribunal has completed its inquiries.

That may take another year or so, so the State is left with a sitting Taoiseach who does not qualify for a tax compliance certificate. And, as was disclosed in December last, the Revenue is also inquiring into other lodgements to Ahern's accounts, over and above those mentioned above.