Today at the Public Accounts Committee the Chairperson of the Revenue Commissioners Ms Josephine Feehily gave details of Ireland’s tax exiles. She gave figures about Irish citizens who absent themselves from what is actually a low tax environment in this country in favour of the bright lights of the Mediterranean. Revenue use media monitoring to determine whether individuals are complying with the Cinderella clause by which if they’re out of the country by mid night then their day doesn’t count as one of the 183 days that they must be resident in the country for tax purposes. In Ireland taxation of an individual's income is what liberal politicians like to call "progressive." The higher the income, the higher the rate of tax payable. In Ireland the tax rates for an individual in 2007 were between 20% and 41%. But in order to be considered a resident for tax purposes one of two tests must apply; residency of more than 183 days a year in Ireland or residency of more than 280 days over a period of two years. To make things easier there is no €10 travel charge on your private jet.
Denis O’Brien, JP McManus, Tony O’Reilly, Denis Desmond all form this column of modern wild geese who find the call of their pocket louder than their interest in their country of birth, but there’s more, much more. Although Ireland’s tax rates are relatively low by global standards, an increasing number of high-net-worth individuals are deciding to leave the country of their birth and move to places with lower income tax and no capital gains taxes
In fact there’s over 5,800 Irish citizens who live outside this state despite the fact that personal taxes here are some of the lowest in any member states of the EU. This figure has climbed significantly in the last 12 months. We may owe a debt to Michael Smurfit for bringing the Ryder Cup to Ireland but rest assured he owes us nothing back and he’s got an accountant who can prove that. Other residents in Ireland who are actually resident overseas include Michael Flately, John Magnier, Hugh MacKeown Who can ever forget the doorsteping by RTE of Bono at UCC when the reporter asked him to reconcile pontificating about Irish overseas aid with his offshore tax arrangements in Holland.
The reality is that the 440 super rich that Ms Feehily identified in her report seem to feel entitled to decide how their contribution to our society if at all is to be made. Yet these tax tourists are feted as hero’s when ever they return to grace us with their presence or even better share their wisdom or bring their sporting friends to the golf pro-ams they organise. To ignore the scandal of the tax exile holding their money off shore while those citizens in the state that made these people so wealthy lie on hospital trolleys or sit in over crowded class rooms is surely more noteworthy than the practise of appeasing ones ego by name buildings after the tax exile. Is it not undemocratic about our state that we allow these people own our media and influence policies that affect our how our tax is spent while they remain abroad and make no contribution? Before the 2007 General Election both the serving and future Taoisigh Ahern and Cowen met with Tony O’Reilly to discuss treatment of their party Fianna Fail by the Independent Group of newspapers during that campaign. Who’ll forget the infamous Indo headline of “Its Payback Time” targeted at Labour from the 1997 GE?.
I have reached the conclusion that holding an Irish passport should be contingent on being tax compliant. Joan Burton says that we should pursue the 33,000 cash millionaires who are Irish citizens to pay their fairs share. She’s right. The passport remains the property of the Minister for Foreign Affairs and can be withdrawn as the minister sees fit. This happened a number of years ago after a scandal involving Irish passports for sale in the UK. So why not when some one declares themselves to be a tax exile withdraw their passport? But then you remember that previous Ministers for Foreign Affairs were Ray Burke and then you understand why.
However our government instead of refusing these tax exiles passports in Michael Smurfit’s case actually put him in charge of issuing passports by appointing him Honorary Consulate to Monaco where he is resident! More to the point at a time when our Revenue Commissioners see a collapse in the tax take, should we not invest a few euro by buying the Irish section of the DVD sold to German tax authorities by a disgruntled German working at a Liechtenstein bank where some of out tax exiles are legally if not actually domiciled?
Surely those of us who stay here from Michael O’Leary to Joe the Plumber are entitled to fairness and equity in our dealings with the tax authorities and vice versa? The days of the golden circle must be surely numbered