Overseas banks in the IFSC could be driven out by over-stringent application of tax rules, according ...
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 and will be taken into account by international financial institutions when deciding whether to locate activities or business in Ireland."
Even in the worst-case scenario, the money would be reclaimable by the offending companies, but the administrative overhead could be considerable and even temporary punitive taxation could be a danger to cash flows.
Bolger said: "We want the situation to be clarified because uncertainty is not what anyone wants. There have been technical breaches, but that is all they were. There is no suggestion of actual loss of tax revenue."
'Asleep at the wheel'
Nomination deadline - 28 June 2019
Tactical opportunities will arise
Multi-asset funds saw £7.9 billion in net retail sales in 2018, sparked by a heightened awareness of risk, following a resurgence in volatility. Scottish Widows examines the appeal of this approach.
What made financial headlines over the weekend?