Clare Daly (Dublin Fingal, Independent)
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160. To ask the Minister for Finance his plans to deal with those revealed to be involved in the Paradise Papers, particularly with regard to construction companies which continue to trade; and if he will make a statement on the matter. [49150/17]

Paschal Donohoe (Dublin Central, Fine Gael)
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I am informed by Revenue that it is aware of, and actively examining, the information and allegations currently being published by various media outlets that originate from the “Paradise” papers.  If further information and allegations become available from the same source over the coming days, Revenue will likewise examine any such further information or allegations that emerge.

Until all relevant information and allegations have emerged it is not possible for Revenue to formulate and decide its overall response to the information and allegations contained in the Paradise papers.

Revenue is determined that any tax evasion identified in relation to Irish taxpayers will be thoroughly investigated. Where tax evasion is uncovered Revenue will seek to have the maximum sanctions applied up to and including criminal prosecutions.

If instances of aggressive tax avoidance emerge, all such instances will be rigorously investigated and challenged by Revenue. Where anti-avoidance legislation can be applied to recover tax avoided through the use of unacceptable tax avoidance practices and schemes, Revenue will seek to apply such legislation with a view to recovering any Irish tax avoided together with all associated interest and tax avoidance surcharges.  

Revenue’s work in the area of identifying offshore tax evasion has been, and continues to be, a priority. The international environment has changed significantly in the years since Revenue started to investigate offshore bank accounts and other offshore assets. Tax authorities worldwide now cooperate on a much wider and more intensive basis in investigating those who hide their profits or gains offshore than they did in the past.  Initiatives such as FATCA (an Inter-Governmental agreement to share financial account information with the United States), DAC (EU Directives on Administrative Cooperation), and CRS (the OECD’s Common Reporting Standard) are all now helping to ensure that tax administrations have greater access to information in respect of offshore assets and income of their residents.  Revenue will make full use of information received from other jurisdictions under these new initiatives on offshore assets to identify and pursue those who have attempted to use offshore accounts, structures or assets to evade or avoid their tax obligations.

In the context of these new information sharing initiatives now becoming available, the Government introduced specific measures in the Finance Act 2016 to ensure that, as and from May 2017, tax defaulters whose default relates to offshore matters are unable to avail of the benefits of the voluntary disclosure regime. Anyone who did not come forward by 4 May 2017 to regularise his or her tax affairs now faces the prospect of substantially higher penalties, publication in the Quarterly List of Tax Defaulters and possible criminal prosecution.

Revenue will also work in close cooperation with other tax administrations, in the framework of the OECD’s Joint International Taskforce on Shared Intelligence and Cooperation, in addressing issues raised by the “Paradise” papers, and will, as appropriate share information with these other tax administrations under existing legal frameworks.

In the context of the construction sector, I am advised by Revenue that it has run a national programme to monitor risks and compliance levels in this sector since 2015 and this will continue to be a priority in 2018. Revenue’s interventions in the construction sector, as in all other sectors, are risk focussed and driven by the taxpayer’s compliance behaviour, data Revenue has on its records and a variety of data from third parties, including the new international initiatives referred to above, and publicly available sources. In 2016, for example, compliance interventions in the construction sector yielded an additional €54.73 million in tax, interest and penalties.