Fair Procedures In Irish Tax Appeals

• Published date: 16 June 2023
• Subject Matter: Litigation, Mediation & Arbitration, Tax, Compliance, Trials & Appeals & Compensation, Sales Taxes: VAT, GST
• Law Firm: Maples Group
• Author: Mr William Fogarty and Eugene McCormick

The Irish High Court¹ (the "Court") has again emphasised the self-assessment nature of the Irish taxation system, and the distinct basis of proceeding in tax appeals, when considering fair procedure complaints by taxpayers. It also confirmed that such complaints should be made, in the first instance, to the Appeal Commissioner at the Tax Appeals Commission (the "TAC"), as it has the obligation and jurisdiction to make appropriate rulings and directions.

The decision serves as another example of the Irish Courts' reluctance to interfere in the TAC's running of live tax appeals, and as a reminder to taxpayers to prepare and argue their full case before the TAC.

Background

Mr. Quigley (the "Applicant") was a fuel trader who sold market gas oil ("MGO" a.k.a. 'green diesel'). MGO is subject to a lower rate of excise duty and Value Added Tax ("VAT") than road diesel, provided certain conditions are met by the taxpayer, including good record-keeping. A 2015 Revenue Commissioners' (the "Revenue") audit revealed alleged inadequacies in the Applicant's records for the years 2009 - 2016; in particular, of 700 accounts investigated, 300 customers could not be identified, and the majority of the interviews with a sample of the other, identified 400 customers suggested irregularities (e.g. the customer denied buying MGO from the Applicant). The Revenue was not satisfied that the MGO conditions were complied with and estimated that 2.7 million litres of fuel were used for non-permitted purposes. The Revenue consequently raised amended excise and VAT assessments across the seven years totalling approximately '1.65 million.

The Applicant appealed those assessments to the TAC and, in the appeal preparations, he repeatedly sought disclosure of information and documentation regarding the Revenue's audit and subsequent amended assessments, in particular:

(a) a list of the 300 unidentifiable customers together with all documents regarding efforts to contact them; and

(b) names, details, and particulars of the sample customers interviewed, together with related documents.

The Revenue eventually provided the list sought under first item but refused to provide vouching documents and, regarding the second item, refused the interview details, citing confidentiality concerns, public interest privilege, and informer privilege. The TAC scheduled a case management conference to hear and decide the issues. In its ruling, the Appeals Commissioner agreed with the Revenue's position...