Mr. Niall Cody:

This is the issue around schemes and legality. Tax planning is a normal part of the corporate business world. The challenge we have is schemes range from implementation of the law and reliefs provided for as intended by the Oireachtas to moving somewhere along the continuum to look at the interaction of reliefs in a way that was probably never thought through when they were being implemented but is still legal. A taxpayer is entitled to plan affairs to minimise that in accordance with law. We also have what we would see as aggressive avoidance, which is legal, but we will challenge it. There is a move from avoidance to deliberate default; that is moving out of legal schemes to what we consider as illegal schemes. We cannot apply penalties unless there is deliberate default. We cannot apply the penalty set out in the code of practice when we challenge avoidance; there are special rules around avoidance. With the types of cases we are dealing with, we see them as beyond legality and acceptability.