Overseas banks in the IFSC could be driven out by over-stringent application of tax rules, according...
Overseas banks in the IFSC could be driven out by over-stringent application of tax rules, according to industry body the Financial Services Industry Association (FSIA).
The FSIA has written to the Irish prime minister Bertie Ahern warning that the Irish Revenue's offensive against tax avoidance is damaging the reputation of the IFSC.
Following an enquiry by the Public Accounts Committee (PAC) into incidents of Irish residents claiming overseas status to avoid paying Deposit Interest Retention Tax, fears have been raised that the Irish Revenue will force companies to pay the basic level of tax on all accounts in cases of incomplete documentation, even when there is no underlying tax liability.
The Revenue has not yet decided what measures it will take in the light of the PAC enquiry, but Ron Bolger, chairman of the FSIA, has warned of the damage that an inflexible approach to the problem could cause.
He said: "There could be enormous damage to the reputation of the IFSC as an international banking location because the regulatory climate will be seen as hostile. This will be exploited by our competitors."
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