Arthur Morgan (Louth, Sinn Fein)

I move amendment No. 6:

In page 6, to delete lines 28 to 35 and substitute the following:

"(vii) excluding relevant emoluments of an individual who is resident in a territory with which arrangements have been made under section 826(1)(a)(i) in relation to affording relief from double taxation, where those emoluments are the subject of a notification issued under section 984(1) except in the case of individuals who hold an Irish passport and who now will pay all levies outlined in this bill.".

The purpose of this amendment is to try to continue the debate in respect of tax exiles. I cannot understand why it was not discussed in conjunction with amendment No. 4 in the name of Deputy Burton. I welcome the fact that this matter is being aired in the Dáil because, as far as I am aware, there is no definition with regard to what constitutes a tax exile. There seems to be a number of different loopholes through which people can apparently escape. One of the most celebrated cases in this regard appeared on the front pages of all the newspapers in the land a number of years ago. I refer here to Denis O'Brien's sale of Eircom and his subsequent construction of a substantial mansion in Portugal. On that occasion, Mr. O'Brien exercised an option to avoid paying very significant tax.

I understand Mr. O'Brien to be one of the examples of a tax exile. I readily accept that there are many others. I also accept that this is a complex area. When other Members and I raised this matter with the Minister on previous occasions, he cited double taxation as a factor. Double taxation must be also dealt with because we want the tax regime to be as fair as possible. The first principle of any report from the Commission on Taxation must be that fairness and reasonableness should apply across the board.

When we consider the area to which the amendment relates, it is apparent that substantial opportunities exist in the context of tightening the loopholes to which I refer in order to prevent a recurrence of the case I have just cited. It is not my place to defend the Minister's party but I must point out that Fianna Fáil was not in government when the individual who had just sold Eircom availed of a particular loophole.

There are other examples to which I could refer but I will not do so now. I am of the view that resolution is required in respect of dealing with people who can declare that they are moving abroad and can thereby avoid, if not evade, substantial tax liabilities. I am not referring to people moving to the Cayman Islands; rather I refer to their moving to other EU member states to avoid their duty to pay tax here. It a blow to hard-pressed working families, pensioners and welfare recipients who are losing their Christmas bonus to see people who avoid paying tax here developing trophy mansions such as that which was built in Portugal.

I hope the Commission on Taxation is examining this issue and will come forward with extensive proposals designed to tighten up the position. This matter is a bone of contention. Examples such as that to which I refer illustrate the need for the introduction of a fairer regime. What is suggested in the amendment could constitute one part of such a regime.

See this speech in context