DIRT Report Recommends Banks Pay Up
The DIRT Inquiry Report published
last week in Ireland by the Public Accounts Committee has recommended
that a re-examination take place of the money to be paid back
by all Irish banks in relation to the bogus non-resident accounts
scheme which the report concluded banks had used to help their
customers evade tax from 1986. The report also recommended money
in all remaining dormant accounts should be handed to the Government
to be used for social initiatives. The report concluded that abuse
was widespread throughout the industry and called for the
Government to conduct a review of the legal framework for the
financial services sector, a view supported by the Irish Central
Bank. But Prime Minister Mr Ahern was cautious on the matter saying
he believed regulation should be voluntary as far as possible,
and that Ireland was no longer a high-tax country so there was
no justification for anyone trying to evade tax. The other significant finding
in the report was that AIB bank did not have a special deal
with the Revenue Commissioners regarding the back payment of deposit
interest retention tax (DIRT). It was the revelation that AIB
had a potential DIRT liability of over £100 million from the thousands
of bogus non-resident accounts it had provided that provided the
spark for the establishment of the DIRT inquiry last year. It is likely that the banks
will be in line for a multi-million pound tax bill once the re-examination
of their DIRT liability takes place. .
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