The Revenue Commissioners wrote off €129m in unpaid tax and PRSI in 2008, according to the Comptroller and Auditor General report, published today. Over €113m of that was accounted for by businesses, which were in difficulty or had ceased to trade.
The largest single amount written off was €9.9m in respect of employers' PAYE, PRSI and VAT, owed by a liquidated company in the security industry.
There were eight other cases, each involving a write-off in excess of €1m.
Revenue were unable to collect a further €15m either because they could not locate the taxpayer, because it was uneconomic to pursue the debt, or on compassionate grounds.
Almost a quarter of a million cases - each with an outstanding balance of less than €1,000 - had their debts written off because they were deemed uneconomic to pursue. Those cases accounted for a total write off of €4.1m.
The CAG also points out that the amount of tax outstanding at the end of March this year was €1.861 billion. That was an increase of €575m - 45% - since the same time last year.
The report reveals that €628m of the outstanding amount is under appeal by taxpayers. Again, the amount under appeal is up 61% compared to 12 months previously.
The CAG also notes that more taxpayers are pleading for extra time to pay their taxes.
The yield to the state from capital gains tax fell by 54% in 2008, compared to the previous year. Stamp duty fell by 46%, while corporation tax fell by 21%.
The sectors from which tax receipts fell most were agriculture, construction, real estate activities and financial intermediation - such as insurance and pension funding - and the wholesale and retail trade.
Revenue explains write-off policy
Reacting to the CAG's report, the Revenue Commissioners have said that tax debt is only written-off when it is uncollectible or uneconomic to pursue.
A spokesperson said that 88% of debt written off in 2008 related to businesses that ceased trading or were in difficulties, which reflects the current global economic reality.
He also said that Revenue write-offs will be reversed if a taxpayer’s status has changed and the prospect of collecting the tax is positive.
