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Irish Revenue Launches New Tax Evasion Inquiry

by Jason Gorringe,, London

20 November 2017

The Irish Revenue has announced that a new inquiry is underway to identify and pursue taxpayers engaged in offshore tax evasion and avoidance.

Revenue said that the inquiry is being conducted in the context of increased and ongoing sharing of information between tax administrations, and of the changes to voluntary disclosure rules made in Finance Bill 2016.

Declan Rigney, Head of Revenue's Planning Division, said: "Using the large volumes of data available to us, we have started an inquiry to identify and pursue those who have attempted to use offshore accounts, structures, or assets to evade or avoid their tax obligations."

He explained: "The international environment has changed very significantly since Revenue started to investigate offshore bank accounts and other offshore assets in 1999. Tax authorities worldwide now co-operate very closely in identifying and tackling those who hide their profits or gains abroad."

Rigney pointed to initiatives such as FATCA, EU Directives on administrative co-operation, and the OECD's Common Reporting Standard.

Rigney also noted that Finance Act 2016 introduced new rules to ensure that tax defaulters whose default relates to offshore matters cannot avail of the benefits of the voluntary disclosure regime. "This means that anyone who did not come forward by the May deadline now faces substantially higher penalties, publication in the Quarterly List of Tax Defaulters, and possible criminal prosecution," he said.

The changes have applied since May 5, 2017. Revenue said that 2,734 disclosures have been made since May 4, 2017, with a declared value of almost EUR84m (USD98.6m).

Daniel Sinnot, Head of Revenue's Research, Analytics and Information Management Branch, said that Revenue uses proprietary software to match the data it receives from other tax administrations to Revenue's own taxpayer records, and then cross-checks this against prior taxpayer returns to ensure that all relevant income and assets have been declared. He added that Revenue also feeds the data into its "social network analysis and anomaly detection tools, to highlight suspicious cases."

Rigney also confirmed that Revenue is "aware of, and is actively examining," the information and allegations arising from the so-called Paradise Papers. He said that Revenue will cooperate with other tax administrations in the framework of the OECD's Joint International Taskforce on Shared Intelligence and Cooperation, to address issues raised by the Paradise Papers, and share information as appropriate.

TAGS: compliance | tax | tax compliance | Ireland | tax avoidance | FATCA | tax authority | offshore | penalties | Tax | Tax Evasion | BEPS

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