Pearse Doherty (Donegal, Sinn Fein)
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180. To ask the Minister for Finance the number of times the Revenue Commissioners are of the view that section 949AG of the Taxes Consolidation Act 1997, prior to its deletion in the Finance Act 2018, had been used to impose an unintended and inappropriate administrative burden on the Tax Appeals Commission and Revenue Commissioners; if the Tax Appeal Commissioners have stated a position regarding the removal of the paragraph; and if he will make a statement on the matter. [54046/18]

Pearse Doherty (Donegal, Sinn Fein)
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181. To ask the Minister for Finance his plans on establishing the right of appellants to take a case to the Circuit Court as opposed to the High Court in view of the deletion of section 949AG of the Taxes Consolidation Act 1997 in order to return to the status quo, as is the stated intention in removing the paragraph; and if he will make a statement on the matter. [54047/18]

Paschal Donohoe (Dublin Central, Fine Gael)
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I propose to take Questions Nos. 180 and 181 together.

Section 949AG of the Taxes Consolidation Act 1997 (which was inserted by the Finance (Tax Appeals) Act 2015) was introduced with the intention of mirroring a requirement in the part of the Taxes Consolidation Act 1997 that requires the Appeal Commissioners to have regard to all matters to which Revenue is required to have regard in making the decision that is the subject of the appeal. However, the section was identified by Revenue and the Tax Appeals Commission as being interpreted in a small number of instances as applying in all situations, and as conferring the right on appellants to require the Tax Appeals Commission to require disclosure of all of Revenue’s documentation on a particular taxpayer or matter, regardless of whether the Commissioners considered that this was required to determine the particular appeal.

The removal of Section 949AG precludes any assertion that it should apply in all situations, even in those where there is no statutory requirement for the Appeal Commissioners to have regard to the same matters to which Revenue was required to have regard.

It should be noted that legislation provides the Tax Appeals Commission with a wide range of other powers to require appellants and Revenue to supply information to assist the Appeal Commissioners in their adjudication and determination of an appeal. It is considered that these powers are sufficiently extensive to allow for the effective operation of the appeals process. However, I can confirm that officials in my Department will keep this matter under review over the coming year, and further amendments will be considered in future if a need is identified.

Legislative change in respect of section 949AG was discussed with both the Appeal Commissioners and Revenue. Both indicated that they had no objection to the deletion of section 949AG.

There is no plan to revert to allowing appellants the right to take a case to the Circuit Court following a determination from the Appeal Commissioners. This feature of the old tax appeals system (pre 2016) allowed for a complete rehearing of an appeal, as if the Appeal Commissioners had never made their determination. It resulted in additional delays, particularly in regard to appeals outside the Dublin circuit, where it is difficult to get a case listed for hearing. It also had the effect of undermining the Appeal Commissioners’ stage of the process where a taxpayer would not fully engage and used the initial hearing as a dry run for the Circuit Court. Moreover, the right to a complete rehearing encouraged taxpayers to re-lodge an appeal, even in circumstances where there were no real grounds for dissatisfaction with the Appeal Commissioners' determination. This runs counter to the principle that cases should be resolved as quickly and effectively as possible and took up valuable court time – a scarce resource.

The reformed appeal system allows more flexible and active case management by the Appeal Commissioners, including written and published determinations and a revised case stated procedure. When appeal proceedings were conducted in the Circuit Court, formal written determinations of the Appeal Commissioners were rarely given and were not generally published. Under the current system, written determinations are made in all cases and published online.

Following the independent review of the operations and governance structures of the Tax Appeals Commission last year, significant additional resources are being provided to the Commission to allow them to recruit more staff (as per a recommendation of the review) and acquire a new case management system. These measures will help the Commission to address the current backlog of appeals.