Wallace tax case silence reflects badly on politicians

ANALYSIS:The apparent lack of sanction for Wexford TD represents a glaring double standard

IMAGINE THE furore in the Dáil if it emerged that a Government TD had knowingly made a false tax return that deprived the exchequer of more than €1.4 million.

The Opposition would call on the Taoiseach to condemn the TD’s behaviour and ensure that he was expelled from whichever party was in power at the time.

Questions would also be asked about the appropriate disciplinary procedures the Dáil itself might take and whether the TD in question could remain a member of the House.

Yesterday morning, Wexford Independent TD Mick Wallace admitted in this newspaper that he had made a false VAT return on behalf of his construction company. To add insult to injury, he made no bones about the fact the Revenue Commissioners would not get a cent of a subsequent €2.1 million settlement because the company was no longer solvent.

The silence from the Opposition when the Dáil met yesterday was deafening, and the restraint on the Government side was remarkable.

The 16-member technical group, of which Wallace is a member, seemed to have taken a vow of silence on the issue and started off Dáil business yesterday as if nothing had happened.

The behaviour of the technical group in rallying around a colleague in trouble was precisely the kind of behaviour they have consistently condemned in others down the years.

Most of the group’s TDs, who normally respond to the media without too much persuasion, were mysteriously unavailable for comment yesterday.

It didn’t stop them contributing to a Dáil debate on their own private members’ motion condemning the “wholly inadequate regime of regulation, supervision and inspection in the construction industry”, which had resulted in the erection of so many shoddy buildings.

The technical group and Sinn Féin TDs pulled no punches in their condemnation of the former government, the present Government and all those politicians who had allowed the construction industry to escape with far too little regulation for so long.

Eventually Labour TD Eamonn Maloney decided that it was time to ask the indignant TDs to look a little closer to home.

“One of the signatories of today’s motion is a tax evader. I am referring to Deputy Mick Wallace.

“Whatever about going on morning radio programmes, to which I make it a discipline of not listening, tax-compliant members of the State require some explanation of this.

“I have always been a PAYE taxpayer. Everyone in the State should pay tax according to their income and wealth. This is one of the reasons I support a wealth tax.

“When I see motions such as the one being discussed, where there is no explanation from someone who engages in tax evasion, I am appalled.”

Maloney, the only TD in the Dáil who does not claim any expenses on top of his salary, got no response from the normally voluble deputies who sit on the Independent benches.

Fine Gael parliamentary party chairman Charlie Flanagan later issued a statement and went on radio to suggest that there should be consequences for a TD who admits to filing an inaccurate tax return.

He also took the TD up on the implication that there was a big difference between filing a false personal tax return and signing an untruthful VAT return.

“It sets an alarming precedent when a member of the House admits to having knowingly filed an inaccurate VAT return. The idea that his company – of which he is the only director – is insolvent, but that he himself remains tax-compliant, is playing ducks and drakes with the conventions of Leinster House,” said Mr Flanagan.

It should not be forgotten that former TD and minister Ray Burke, who resigned his cabinet post and his Dáil seat in 1997 when the media exposed details of “donations” he had received from business, was actually sentenced to six months in jail for filing a false tax return.

Even more to the point, businessman Paul Begley was given six years in jail earlier this year for failing to pay VAT of €1.6 million on imported garlic.

The way in which Wallace appears to be facing no sanction of any kind represents a glaring discrepancy between the treatment of a member of the Dáil and that of an ordinary citizen.

The Wexford TD insists he did not have a lavish lifestyle and that this should be a mitigating factor in the reaction to his tax problems.

The lifestyle argument is one that was frequently put forward on behalf of former taoiseach Bertie Ahern when questions arose about his personal finances. Ultimately Ahern’s lifestyle was found to be irrelevant to the questions at issue and the planning tribunal drew its own conclusions.

The public will now await with interest to see what sanction, if any, will apply to Wallace. Those who are normally the first to demand high standards appear to have abandoned them when the finger is pointing at one of their friends.

It is not only Mick Wallace whose credibility has been undermined by this sorry episode.

Stephen Collins is political editor