Joan Burton (Dublin West, Labour) | Oireachtas source

Most of the schemes like this are the product of various large accounting and legal firms producing packages which they can then sell around the world to people in the appropriate income bracket. That is one of the principal reasons the scheme in Ireland has failed to be capped properly and now results in a significant difference in tax treatment between somebody who is fully resident for tax purposes and somebody who is brought into this structure by an accounting or legal firm. Ultimately, many of the recruiting firms end up paying as much in service costs to the legal and accounting advisers for these schemes as the individual may end up paying in tax. However, the notion of equality in the tax system for people on similar levels of income is undermined, particularly when it goes into very high income figures as it has done now.

7 o’clock

Second, at the beginning of this Dáil, the Committee on Budgetary Oversight was established for the specific purpose of shining a light on the details, consequences and arguments for and against various tax arrangements. The Report Stage amendments before the House tonight contain a series of proposals for reports on areas such as the special assignee relief programme, SARP. The Government should be enabling the Committee on Budgetary Oversight and its officials, because it has an official status to carry out these reports and be clearly enabled to do so by the Department of Finance and other relevant Departments.

I have a long-standing Private Member's Bill before the Dáil, which I would be delighted if the Government would take over, to establish a standing commission on taxation. It would examine the outcomes, fairness or unfairness, and costs of various elements of the tax code. If there was a development in the tax code, as often happens, and that development was used more or costed more than originally envisaged, there would be, as a matter of policy, an ongoing examination of its impact, including the loss of tax to the Exchequer, which means less money for education, health and the Defence Forces. This is done in many jurisdictions as a matter of policy.

The Committee on Budgetary Oversight has produced very valuable publications on the costs of various tax breaks and tax arrangements, and this has been very useful, but from an overall policy perspective, that should be built into the system. Ultimately, everyone is paying some form of tax, particularly people in the PAYE sector, and it is understandable and correct that it should be perfectly easy to analyse who is getting special deals or arrangements and, more importantly, what these cost. It is understandable that if a much sought-after employee is moving to Ireland, he or she would get some arrangements to recognise the costs of moving and establishing his or her household and so on. However, for it to go on and on over a long period is not justified. The people who sell these schemes will always want to keep them for as long as they can, and forever if possible. The details should be published in full annually, and the best way to do that would be through the Committee on Budgetary Oversight. Its officials should be given access to the information and it would be published regularly.

At one time we gave massive tax breaks to people who owned racehorses, and we have done that with all sorts of things. Gradually over a period, we decided either to eliminate or reduce these enormous blanket tax breaks. These were not small tax breaks in relatively modest levels of expenses. There is a case for permanent oversight of tax. Revenue is not the body to do this. Its job is largely the collection of revenue and the establishment of the tax base. Neither is the Department of Finance the institution to do this. Whoever is Minister for Finance has a particular vested political interest. In Ireland and many other places, there is a growing sense of inequality which undermines the very basis of our democracies. Yesterday, Lidl announced it would pay all its employees the living wage. I assume Aldi will follow.

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