Mr. Niall Cody:

I thank the committee for the opportunity to make this short opening statement. As time is limited, I will confine myself to a brief overview of the two relevant chapters from the Comptroller and Auditor General's report.

Since assuming responsibility for the administration of local property tax in early 2013, Revenue has collected in excess of €1 billion for the Exchequer, including €45 million in respect of the household charge, and achieved compliance rates of 97% for both 2013 and 2014. The compliance rate for 2015 currently stands at 96%.

The introduction of the local property tax was the largest extension of the self assessment system in the history of the State and was, as acknowledged in the report of the Comptroller and Auditor General, a huge undertaking for Revenue during a time when its resources were diminishing, both in terms of staff numbers and its administrative budget. Within a timeframe of less than nine months Revenue had to design, build and implement a fully functioning tax system. We had to assist in the drafting of legislation, build a property register, develop flexible payment options to suit different customer preferences and deploy resources to the provision of a customer support service.

The compilation of the first register of residential properties in the State required us to identify the properties and connect each property to a liable person using Revenue data and data from a range of other sources such as the Local Government Management Agency and the Private Residential Tenancies Board. Data from the various sources were cross-checked to ensure the register was as accurate as possible. However, given the scale of the data matching process, it was inevitable that there would be some errors and, from the outset, Revenue was very open with the public about this. We updated the register as issues were brought to our attention and the register continues to be updated as additional information becomes available to us. There are currently 1.95 million properties on the register.

We also developed an online interactive guide to provide average indicative property values to assist property owners in the self-assessment of the value of their property. Our main concern in developing the systems and processes necessary for the effective and efficient administration of this tax was to make it as easy as possible for individuals to pay and difficult to avoid. From March 2013, our focus was very much on ensuring that property owners understood the requirements of this new tax and their obligations. A comprehensive communications strategy was implemented. The various payment methods include a number of phased options. The various options are all working very well and are assisting customers to be compliant by giving them the option to pay that works best for them.

In respect of the minority of property owners who failed to meet their LPT obligations, there is a range of debt collection and enforcement options provided for in the LPT legislation. The collection method used necessarily depends on whether the individual is a PAYE worker or self-employed. These options include mandatory deduction from salary, pension or certain Government payments; referral of the outstanding debt to the sheriff or solicitor, a surcharge on income tax, corporation tax or capital gains tax returns, withholding tax clearance certification. Over the course of the 2013, 2014 and 2015 compliance programmes Revenue issued approximately 600,000 warning letters, deducted payments from salary or pension in more than 140,000 cases, some being repeat cases, refused tax clearance certification in approximately 29,000 cases and imposed surcharges in approximately 19,000 cases. We also referred in excess of 1,000 cases to the sheriff for collection. To date, no LPT liabilities have been referred for court action, nor have we used our attachment powers to secure payment, although we reserve the right to use both options if required.

Household charge arrears that remained unpaid at 1 July 2013 were converted to a €200 per property LPT debt and Revenue was given the responsibility for collecting the outstanding amounts. As a result of our household charge compliance campaign, almost 318,000 property owners have become compliant and paid almost €45 million in arrears. Compliance activity is ongoing in the 47,000 cases that have yet to pay the charge.

Moving on to the rental income chapter, I would like to first state that Revenue commits a significant proportion of its compliance resources to combat shadow economy activity and the rental sector is an area we have particularly focused on in recent years. We select cases for intervention based on the presence of various risk indicators and other information available to us. Third party information is a really important element in addressing non-compliance. Matching this data against returns filed by taxpayers and addressing outliers or cases that have failed to include this data in their returns has been a feature of our compliance strategy for many years. This approach is particularly relevant in the rental income sector, where significant amounts of third party information are made available to Revenue and matched to landlord records. Currently, this data includes Private Residential Tenancies Board data, rent subsidy payments from the Department of Social Protection, rental accommodation scheme payments from the Department of the Environment, Community and Local Government, student accommodation lists, letting agent returns, non-principal private residence data and, of course, Revenue's local property tax data.

The increase in the number of data sources used has been influenced by work carried out previously by the committee and following on from a previous report from the Comptroller and Auditor General. Our matching rates have also increased significantly to a position where we now have matching rates of around 90% for the biggest data sources. This compares with figures of around 50% when that report was originally published back in 2008. The Comptroller and Auditor General has commented favourably in the report on the significant improvement in the matching of this data to landlord records. The matched third party data is fed into our risk evaluation analysis and profiling system, REAP. REAP has over 50 risk rules that are related to property ownership or rental income. The Comptroller and Auditor General has commented favourably on the successful targeting of interventions in the rental sector. Our focus on compliance in the sector continued in 2014. In the past two calendar years, we have conducted over 1,100 audits and nearly 9,000 risk management interventions in the rental sector, with a total yield of €81 million.

I am happy to discuss any issues and answer any questions raised by the committee, subject of course, to taxpayer confidentiality.