ANYONE WHO thought tax evasion had gone out of fashion, following three major investigations by the Revenue Commissioners, was being naïve. As a recent international survey showed, Irish people consider drunk driving to be a far more serious offence. And tax officials are struggling to catch up.
Just how far they have to travel may become evident after the deadline for voluntary disclosures of large deposit and investment accounts expires at close of business today.
We have learned from previous investigations that the largest offenders are the least likely to make voluntary confessions. They keep their heads down and hope to avoid detection. In spite of that, more than €3 billion has been collected in taxes and penalties by Revenue from surveys involving bogus non-resident accounts, offshore accounts and single premium insurance accounts.
The latest examination involves deposit and investment accounts that contained more than €100,000 in 2005 and 2006, details of which will have to be revealed by all financial institutions. Already, more than €3 million has been paid over. And thousands of inquiries have been received from non-compliant taxpayers.
The seriousness of an offence is often judged by the penalty it attracts. In that respect, tax evasion does not rate particularly highly in this State because - in spite of a great deal of official huffing and puffing - few offenders end up in jail. On this occasion, special inducements are being offered to those who make voluntary disclosures. A maximum penalty of 10 per cent will be imposed; no prosecution will take place and names will not be published. Those who attempt to brazen it out, on the other hand, face penalties of 75 per cent, public disclosure and possible prosecution.
This new investigation targets domestic accounts. But the Revenue is also extremely interested in the purchase of overseas properties with undeclared funds. And it is seeking powers to compel auctioneers and estate agents to provide it with details of such purchases. In the first six months of this year, €32 million was paid over by tax defaulters. That is a lot of money. But it is likely to pale into insignificance when these new anti-evasion schemes get under way.
There has been an improvement in the level of tax compliance since the late 1980s and early 1990s when establishing bogus offshore accounts and facilitating DIRT evasion became a growth industry for our financial institutions. But it remains a challenge to ensure that all citizens pay their due taxes.