Taxman helps others find their financial feet
Kieran Holmes: "They got me out of the car, put a gun to my head and said 'run' . . . I wasn't sure if they were going to shoot me in the back as I ran"
Wild Geese: Kieran Holmes, Office Burundais des Recettes, BurundiA Sligo man has used his skills to help poor countries develop a tax base
If you thought a job collecting tax in Ireland might be tough then meet Kieran Holmes. A career break from the civil service in 1984 has seen this Sligo man collect tax in far more hostile environments.
Graduating in economics from Trinity in 1977, with most of his class emigrating, Holmes cut his teeth as an inspector of taxes with the Revenue Commissioners.
“The culture around tax was terrible,” he recalls. “Not only was the private sector wantonly evading or avoiding tax, but the government was giving away tax left, right and centre.”
Of the exporting companies under his watch, he says: “All of their profits were being written off against export sales relief or various incentives; there was very little revenue actually collected.” It was an antiquated system where appeals took years to settle, he says. “It was a very bad culture, I hope it’s improved now.”
After seven years, a tip-off from a friend saw Holmes respond to a newspaper advertisement seeking an inspector of taxes for the remote Pacific island of Kiribati.
“I didn’t know where the country was when I applied,” he admits. “But for me it was an opportunity to do something in development and use my tax knowledge to help a country.”
Swapping Dublin for silvery sands and azure waters, his international career began. Newly independent from the UK, Holmes helped the country get on its feet financially. Raising tax collection by 400 per cent, he also negotiated a double taxation agreement with Australia that made Aussie fishing boats a taxable entity of Kiribati. “That made a huge difference to fiscal controls,” he says.
Seven years later, a job offer with the British government’s overseas development association in Lesotho brought him to Africa.
“Africa was a shock,” he says. “In the Pacific, you never saw a gun but the first thing you see in Africa is AK47s everywhere.” Six months into the job, on his way to meet the minister for finance one afternoon, Holmes was kidnapped. Four men with guns, with eyes on his car, drove him into the mountains. “They got me out of the car, put a gun to my head and said ‘run’. That was the scary part, I wasn’t sure if they were going to shoot me in the back as I ran.”
While his employers gave him a couple of weeks leave to recover, he notes wryly: “I wish to hell I’d had some counselling at the time.”
Aside from such dangers, there was the challenge of collecting taxes. International construction firms failing to pay taxes for work on dams were his first port of call.
“When I got there, they were only collecting the equivalent of 30 million rand a year. When I left, it was well over 600 million,” he says.
Having worked with the IMF to draft tax laws for Kiribati and Lesotho, Holmes was invited to be part of its mission in Jordan, evaluating the country’s income tax system.
There followed a World Bank and EU-funded project in Swaziland and a IMF/UN project in Yemen, a country he describes as “hugely corrupt” and “a dangerous place”.
Did he ever miss the security of the Revenue Commissioners?
“Not once. The idea of promotion by graveyard was sitting in the Irish Revenue for 40 years; it would just drive me bonkers. Going overseas and using my tax knowledge for economic development was far more appealing to me.”
He jokes that he’s still on the books of the Revenue Commissioners – “I’m on leave without pay after 28 years”.
He describes development work as sometimes, “saving people from themselves”.
“There is no such thing as a poor country, just a poorly managed country. That’s why they remain in poverty. You sit there talking to a corrupt minister, trying to get him to do the right thing for his country but he’s only interested in is what’s in it for him.”
He says there are ways and means, however. “I’d often get the IMF to propose to the government that something be a benchmark which means it has to get done – because, if it’s not done, the IMF assistance doesn’t come and if it doesn’t come, no other donor assistance comes.”
He describes over 10 years in Rwanda as the opposite to Yemen because “they were so focused and so willing to engage”. “We did a hell of a lot there. We drafted new tax laws, new VAT laws, computerised customs and tax, drafted double taxation agreements, trained staff, built new buildings – we really transformed it.”
Holmes is now commissioner general of Burundi where he has political responsibility for the collection of tax. Appointed by the president, this Irishman is the only expatriate in government.
A post-conflict country that doesn’t enjoy the budget support of Rwanda, he says: “It’s trying to make its way in the world and it needs every penny of revenue it can get. It’s literally pulling itself up by its own bootstraps.”