Eoghan Murphy (Dublin Bay South, Fine Gael) | Oireachtas source

I move amendment No. 135:

In page 75, to delete lines 35 to 40 and substitute the following:

“(i) in paragraph (a), by substituting “a specified sum or an adjusted specified sum (within the meaning of subsection (2C) or (2D)), as the case may be, under subsection (2)(c), including as applied by subsection (2C) or (2D)” for “a specified sum under subsection (2)(c)”,

(ii) in paragraph (b), by substituting “a specified sum or an adjusted specified sum (within the meaning of subsection (2C) or (2D)), as the case may be, under subsection (2)(d), including as applied by subsection (2C) or (2D)” for “a specified sum under subsection (2)(d)”, and”.

Amendments Nos. 135 to 142 relate to section 55 of the Bill, as published, which makes a number of changes to section 1086 of the Taxes Consolidation Act 1997. This is the provision that governs the publication of the names of tax defaulters. The purpose of the amendments, both those in the Bill, as published, and the amendments I am bringing forward today, is toensure that the scheme of publication of tax defaulters operates as intended. The additional amendments reflect further consideration of section 55 since publication and comprise both technical and consequential drafting changes to clarify aspects of the provision and a number of substantive changes to ensure that the provision is comprehensive.

I will address the substantive changes first. In some settlements of tax, interest and penalties entered into by Revenue with a tax defaulter, the settlement amount may comprise an amount relating to a qualifying disclosure made by the taxpayer and an amount relating to matters not subject to a qualifying disclosure. In such cases, it can also arise that Revenue enters into an agreement with the defaulter to pay a sum in settlement of the full amount of tax, interest and penalties due, or the defaulter may decide to pay the full amount of the liability without entering into an agreement. The amendments in the Bill as initiated dealt with the first scenario described above, that is where a settlement sum is paid on foot of an agreement, and clarified the amount to be published in such cases. Amendment No. 136 ensures that the second scenario is also covered, that is where the tax defaulter pays the full amount of tax, interest and penalties without entering into an agreement with Revenue and clarifies the amount to be published in these cases also. The amendment deals with each of these situations in separate new subsections in section 1086 and, whereas section 55 of the Bill, as published, availed of a simple A to B formula to clarify the amount to be published, the amendment does the same thing but by way of a series of definitions to arrive at the adjusted specified sum for publication that works for both types of cases. The amendment puts beyond doubt that the portion of the settlement sum, or of the full liability, in respect of which a qualifying disclosure is made will be excluded from publication, and only that portion relating to matters not subject to a qualifying disclosure will be publishable, provided the publication criteria are met in relation to those matters.

The second substantive amendment is No. 138, which relates to subsection (4A) of section 1086. This is the subsection that facilitates increases in the publication threshold. The Bill, as initiated, amended the mandatory requirement that the Minister for Finance make an order increasing the publication limit in line with the CPI every five years to a discretionary requirement to increase the limit from time to time. The intention was that once the Bill was enacted a ministerial order would be made increasing the limit to €35,000 from the current limit of €33,000.

Inadvertently, it was overlooked that there are in fact two separate publication thresholds in section 1086. One relates to situations where the defaulter has reached an agreement with Revenue to pay a settlement amount while the other relates to persons in whose case the penalty element of the tax, interest and penalties due has been determined by a court. From 2008 to 2010 the two thresholds were the same but diverged when the last ministerial order was made in 2010, because the court penalty-related limit was not referenced in the order. This was a legislative oversight at the time. Clearly the publication thresholds should be standard across all relevant subsections of section 1086 and increase in tandem on foot of any ministerial order increasing the publication limit.

In considering this, the Parliamentary Counsel and the advisory side of the Attorney General’s office have advised that the best solution is for the inclusion in the primary legislation in subsection (4A) of a new definition of "relevant amount" which will be set at €35,000, that is, the new publication threshold. The publication thresholds relating to settlement cases and court penalty cases will then be cross-referenced to the "relevant amount", €35,000, stipulated in subsection (4A). Any future ministerial order will increase the "relevant amount" by the appropriate consumer price index increase in the intervening period and this higher threshold will then automatically apply to both the settlement and court penalty publication thresholds. This approach will obviate the need to make a new order after the Finance Bill 2016 is enacted as the threshold will be up-to-date. While diverging from the Bill, as initiated, this proposed approach is more logical and satisfactory. The purpose of amendment No. 138 is to achieve this. These changes will come into operation on the passing of the Act.

Amendments Nos. 135, 137, 139, 140, 141 and 142 are drafting or technical amendments required to clarify aspects of the provision and take account of consequential changes elsewhere in section 1086 on foot of the substantive amendments described above.

I commend these amendments to the committee.

I wish to advise the committee that I will table a further amendment to section 55 on Report Stage to deal with a technical drafting error.