Richard Bruton (Dublin North Central, Fine Gael)
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Question 104: To ask the Minister for Finance if he is satisfied with the general anti-avoidance measures in the tax code and the way they compare to provisions in Sweden; and if he will make a statement on the matter. [13640/09]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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Arrangements for addressing and tackling aggressive tax planning and tax avoidance differ across States. However, a common purpose running through many of these arrangements is the need for tax authorities to know, as early as possible, the details of schemes that may not be acceptable.

In this jurisdiction, apart from specific anti-avoidance provisions contained in various sections of the Taxes Consolidation Act 1997, one of the weapons used in combating aggressive tax planning has been the general anti-avoidance provision contained in section 811 of the Taxes Consolidation Act 1997. The efficacy of this measure is reviewed by both my Department and the Revenue Commissioners on an ongoing basis. In light of such reviews in recent years, a new protective notification regime was introduced in the 2006 Finance Act and further enhanced in Finance Act 2008 to operate alongside the general anti-avoidance provision.

It is vital for the overall effectiveness of the tax system that the Revenue Commissioners be aware of the tax avoidance strategies being used by taxpayers – not least, because it enables them to advise the Minister for Finance of the day where counteracting legislation may be necessary. The primary purpose of the protective notification regime is, therefore, to encourage taxpayers and their advisers to be open with Revenue in relation to transactions that may be tax avoidance transactions within the meaning of section 811. It is encouraging that the enhanced protective notification regime is having an impact, with 72 new protective notifications received by the Revenue Commissioners since its enactment.