Sunday, September 30, 2018

The Irish Tax Evaders

83 ‘High Worth Individuals’ (HWIs) used tax credits and reliefs to declare a taxable income below that of the average workerThe report examined how the Revenue taxed Ireland’s 334 HWIs – defined as those worth more than €50 million – in 2015.
Approximately €473m in income tax was paid by the 334 HWIs that year, an average of €1.4m each. However, 140 HWIs (42% of the total) were found to have a taxable income of less than €125,000, while 83 had taxable income of less than the average industrial wage, which is just over €36,500.
A combination of clever accounting and loopholes is allowing some of the country's richest individuals to minimise their contribution to the State's coffers. Individuals claimed tax relief for maintenance, significant buildings and gardens relief, venture capital relief and trans-border relief, which gave them in benefits which averaged €167,000 each. Many reduce their tax bill by investing in assets like machinery, citing previous losses made on investments or using credits for tax paid in other countries.
The Comptroller and Auditor General (C&AG) reviewed how 480 people, classified as 'High Wealth Individuals' (HWI), interact with the Revenue Commissioners.
It was found that, despite having at least €50m in assets, they paid "relatively low amounts of tax due to the use of credits and reliefs". One in four declared taxable income below the average industrial wage, which the C&AG cited as €35,672. Overall 140 HWIs had taxable income of less than €125,000. Remarkably just 10 taxpayers from this group were liable for 85pc of the total tax paid, which was €473m in 2015.
The report also found that Ireland’s definition of a HWI is high compared with other countries. While criteria vary from country to country, HWIs are generally considered to have assets of between $1 million and $50 million, while ultra-High Worth Individuals have assets of over $50 million However, the Revenue defines HWIs as those with assets of more than €50m. By comparison, HWIs in the UK are classed as those worth more than €23m, while HWIs in Spain are worth more than €10m. 

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