The amount of tax owed at the end of March was €2 billion, 9 per cent less than the figure for two years earlier, according to the annual report of the Comptroller & Auditor General (C&AG).
During 2014, a total of €228 million in tax and PRSI owed was written off, with just 48 taxpayers accounting for €109 million of this. Companies going into liquidation and bankruptcies were the most frequent reasons for these write-downs.
The two largest categories of debt were income tax (€687 million) and VAT (€551 million). The income tax debt was the equivalent of 28 per cent of the total charge raised in the year, while the VAT figure was 6 per cent of its total.
The capital gains tax debt, which was €167 million, was 38 per cent of the total charge raised.
The total debt included €701 million for which assessments had been issued which were under appeal.
Property tax
In addition to the €2 billion in gross tax, a further €95 million in pre-2015 local property tax was outstanding, with a significant proportion of this relating to arrears of the household charge that have not yet been confirmed as properly due.
The accounting officer for the Appeal Commissioners, which hears appeals against tax assessments, failed to respond to queries from the C&AG despite its obligation under law to do so, according to the report.
The C&AG queried how data from the Appeal Commissioners could indicate it had about 120 cases on hand at any given time, while data from the Revenue showed 333 cases were awaiting hearing in mid-June 2013.
It wanted to establish if the Appeal Commissioners were giving data relating only to cases where a hearing date had been set. Due to the non-response from the accounting officer for the Appeal Commissioners, the C&AG was not able to resolve the issue.
Four economic sectors accounted for 60 per cent of the total tax written off in 2014, with the wholesale and retail trade sector accounting for 17 per cent, construction 15 per cent, accommodation and food services 10 per cent, and “other service” activities 18 per cent.
Internal reviews of writedowns found they were arrived at in accordance with procedures, though in some cases the recording of the write-down did not comply with internal guidelines.
