LABOUR OPPOSES SEVEN MONTHS GRACE FOR OFFSHORE TAX DEFAULTERS

The proposal in section 54 of the Finance Bill has been described by Labour’s Spokesperson on Finance, Joan Burton, as in effect, an amnesty for tax defaulters using offshore and overseas tax havens to avoid paying their legitimately due taxes in Ireland.

According to Deputy Burton:

“By delaying the implementation date to the first of May, the Minister for Finance is effectively giving such tax defaulters an extra seven months to pay up in Ireland or indeed, to rearrange their affairs and stay one step ahead of the taxman.

The Labour Party will seek to bring the due date forward to ensure that tax defaulters pay their tax due, in the same way that people on PAYE have to pay.

There will have to be a very detailed discussion of the proposals by the minister to take such a softly softly approach to defaulters who have overseas and offshore assets and income streams.

We know from the Panama Papers published earlier in the year, that there were numbers of Irish people and firms referenced in the papers.  We also know from previous reports and tribunals that there have consistently been small numbers of Irish people and firms who have used offshore devices to avoid or mitigate their due tax.

If Revenue is now to take some very welcome action, that action should be taken as quickly as possible. In its alternative budget, Labour proposed to beef up the fight against tax defaulters, particularly those using offshore mechanisms.”

Taxing Vulture Funds

“The Labour Party welcomes the proposals in the Bill to provide for tax on property and income held in various property structures particularly in Irish Real Estate funds.

The public have been rightly extremely upset at the idea of certain vulture funds that have been able to buy Irish assets cheaply following the crash but where they have in effect been largely exempt from taxation. This was the subject of both detailed discussions and recommendations of the budgetary oversight committee prior to the budget.”

Help to Buy Scheme

“While the Labour Party has been critical of the new help to buy scheme for first time buyers, we welcome the reduction of the loan to value mortgage rate from 80 to 70 per cent. This is particularly likely to help people building a home of their own and those in rural areas where house prices are significantly cheaper than in cities and in towns.

The Finance Bill 2016 as published today, confirms some of the major changes in last week’s budget. As we said this is a very political budget and the various changes, including the help to buy, underlies the absolute dependence of the government on Fianna Fáil.

Although, the Minister for Finance has not included the proposed reduction in the value of the house to €400,000; he should confirm if he will introduce this change by way of a committee stage amendment.”