The latest figures from the Revenue Commissioners provide convincing evidence that tax evasion is still widely practised in this State, to the detriment of the least well off in society.
Last week, five tax defaulters paid more than €I million each in settlements with the Revenue. And, in the three months to September, a total of €43 million was collected from 371 tax-evading citizens. The scale of the criminality involved is put in perspective when you consider that budgetary cutbacks in 16 schemes at the Department of Social Welfare affecting rent allowances, education for single parents, crêche care and other services will save only €58 million in 2004.
Total settlements with the Revenue Commissioners in recent years, following the findings of various tribunals and investigations into off-shore accounts, amounted to almost one billion euro by the end of September. It is a huge amount of money. And a whole series of inquiries is still in train. The amount arising from tax and penalties on bogus non-resident accounts came to €697 million alone. Recently, those who placed money with the Bank of Ireland and the Irish Permanent in Jersey and the Isle of Man were invited to come forward and make voluntary declarations. Similar approaches are likely to be made to offshore depositors with other institutions.
The extent of evasion being practised three years after the findings of the DIRT inquiry is a source of serious concern. But the situation is changing. A range of new powers has been granted to the Revenue Commissioners, allowing them to access details of accounts and to demand the co-operation of financial institutions. Their audit section has been strengthened and extra staff recruited. In spite of that, the Commissioners still favour a carrot, rather than a stick, approach. Tax defaulters are invited to co-operate and offered concessions. Even where co-operation is not forthcoming, the offenders tend to face financial penalties, rather than prosecution.
In the past year or so, the Criminal Assets Bureau - involving the Garda Síochána and the Revenue Commissioners - has begun to extend its operations beyond the original drugs and gangland purview. The former assistance Dublin city and county manager, Mr George Redmond, was first charged with making false tax returns before he was eventually jailed on charges of corruption.
A former minister for justice, Mr Ray Burke, is now facing trial on both tax and corruption charges. Given the linkage being created between both forms of criminal behaviour in the public mind, the number of trials for tax offences is likely to increase.
White collar crime and, in particular, income tax offences have been accorded a low priority in the past. But as society becomes wealthier and demands grow for better health, education and social services, it is vital that a level playing pitch is operated for all tax-paying citizens. In bringing that about, the risk of tax cheats being caught and punished must become greater. Self-preservation is still the greatest stimulus towards tax compliance.