Office of the Comptroller and Auditor General - Press release VFM examination report on Use of Sheriffs and Solicitors in the Collection of Taxes

Press Release

13 April 1999

Value for Money Report on the

Use of Sheriffs and Solicitors in the Collection of Taxes

The Comptroller and Auditor General, Mr John Purcell, has carried out an examination of the use of sheriffs and solicitors in the collection of taxes.

The systems employed by the Office of the Revenue Commissioners for the follow-up of outstanding taxes and for the selection of cases for referral to sheriffs and solicitors for enforcement action have changed significantly. Since 1995 there has been a shift from a process driven approach to a new system of early intervention by Revenue staff in tackling non-compliance. The overall effectiveness of the new system is dependent on a balance being achieved between the efficiency gained from early intervention and the impact of delays in referral to sheriffs and solicitors for enforcement.

The purpose of the examination was to review the efficiency of the procedures for referral of outstanding taxes to sheriffs and solicitors and their efforts to recover the amounts due.

A report on the examination is being presented to Dáil ?reann today. The main findings of the examination are summarised below.

For further information about the report contents, please contact:

Fergus O’Brien at (01) 679 3122

Main Findings

  • Although a new system for following up outstanding taxes has been in use since 1995, a significant amount of outstanding taxes was still subject to the older and less efficient process driven procedures at the end of 1997.
  • The overall level of tax debt has fallen in recent years, and at the end of 1997 was ?1,587 million. However, the level of new tax debt each year has remained in excess of ?500 million.
  • Referrals of certificates to sheriffs for enforcement has declined from 131,000 in 1993 to 63,000 in 1997 but the quality of referrals has improved and this is reflected in a higher percentage returned paid.
  • Almost 50% of taxpayers who were subject to sheriff enforcement in 1996 and 1997 in respect of certificates amounting to some ?444 million had been referred to sheriffs on more than one occasion in that period. Taxpayers with certificates amounting to ?180 million had been referred on five or more occasions in the period. This incidence of persistent non-compliance suggests that there is room for strengthening the deterrent effect of sheriff action.
  • A large number of cases identified as suitable for sheriff enforcement are withdrawn as a result of screening procedures. There is incomplete information on the reasons why and this can hinder effective follow-up.
  • The system for tracking certificates issued to sheriffs is unsatisfactory as the current status of individual certificates cannot be ascertained. This is being addressed as part of revised monitoring arrangements.
  • Some 22% of the value of cases referred to the solicitor firms for enforcement between 1993 and 1997 was subsequently recovered. When cases withdrawn by Revenue are excluded the rate of recovery is approximately 40%. The rate of recovery by the Revenue Solicitor is lower but this may be due to the requirement to handle more complex cases.
  • Some ?61 million, in respect of cases referred to solicitors between 1993 and 1997, remained uncleared in March 1998. A large proportion of these cases have not been acted on for some time.
  • Recovery of costs from defaulting taxpayers arising from solicitor action is low. Ways of ensuring that the defaulting taxpayer carries the costs should be explored.
  • Information within Revenue to support the management and evaluation of solicitor enforcement is very limited. In the absence of a proper tracking system Revenue have not been in a position to comprehensively evaluate the effectiveness of solicitor enforcement. New systems are in the process of being developed

The contents of this page were last updated on 26/09/03