Fintan O’Toole: Publishing tax returns a good way to revive ideals of Rising
Confidentiality of tax returns is unquestionable only because it is unquestioned
“Instead of waving rifles or proclamations, we should proudly hold aloft our Form 11s.” Photograph: Nick Bradshaw
The Rising that took place a century ago this week was an imaginative spark. The depressingly mundane manoeuvring for the formation of a new government suggests that the political imagination has long since turned to ashes. Wouldn’t it be great if there were a simple, cheap and non-violent gesture that would restore some sense of republican idealism and signal the beginning of a new era? In fact there is: publish all tax returns online.
The confidentiality of tax returns is one of those things that is unquestionable because it is unquestioned. It is a matter of faith, even when it is patently absurd. In January, to take just one example, the Department of Arts and Heritage refused to say who had purchased a painting from Russborough House and donated it to the State. This was a public transaction that had to be approved by the Revenue and the department and that related to a public controversy. The donors, Lochlann and Brenda Quinn, apparently had no problem with revealing it – their identity was published in The Irish Times. But it remained an official secret – the department cited, of course, “the confidentiality of tax returns”.
Last year the heads of the Finance (Tax Appeals Commission) Bill were considered by the Oireachtas Joint Committee on Finance. One of the key proposals was that Ireland would follow, for example, the US, Canada and Australia, and hold tax appeal hearings in public unless there is a very good reason for privacy.
The committee said this was probably a good idea because it “brings clarity to the Revenue Commissioners’ decisions and makes the process more transparent for the general public”. Bizarrely, it still came out against it because there might be “a small business owner whose business may be threatened by a local competitor if his financial situation became public knowledge”.
The confidentiality of all dealings between citizens and the Revenue is sacred scripture, and any breach is culpable blasphemy: under section 851A of the Taxes Consolidation Act 1997, it is a criminal offence for any past or serving Revenue officer to disclose any taxpayer information. Which means, of course, that when Revenue officials appear before Oireachtas committees or tribunals investigating very serious allegations of abuse or evasion, they can speak only in the vaguest generalities. Secrecy is much more important than accountability.
Culture of secrecy
Why is this culture of secrecy taken for granted? Norway, famously, has treated all tax returns as public documents since 1863. For more than a decade now, tax returns in Norway have been published online in searchable form. You can see anyone’s annual income, net worth and tax contribution. (Importantly, the openness goes both ways – if you search for a return, your identity is also disclosed to the taxpayer in question.) There is absolutely no evidence over 153 years that this has inhibited businesses or caused trouble. On the contrary, it has made taxpaying a matter of public pride, made Norway the least corrupt country in the world and sustained an egalitarian culture.
The insistence that tax is like sex, a private intercourse between consenting adults, is perverse and hypocritical. We already know what public servants earn, and anyone with a calculator can work out the tax due on such earnings. The value of most people’s main asset, the family home, is easy enough to ascertain by an online search of property sales. Hysterical claims that the publication of EU subsidy payments to 130,000 Irish farmers would destroy rural life as we know it came to naught. That database is now online and searchable – as it should be.
Why then is there such a deep and widespread belief in the sanctity and secrecy of tax returns? It rests on highly ideological assumptions. One is that wealth is a strictly private matter. Another is that the relationship between the citizen and the State is purely individual and has no wider social consequences. And the third is that taxation is innately shameful – it seems no accident that the confidentiality of the tax return mirrors that of the Catholic confessional.
The secrecy of tax payments, on the other hand, is corrosive of public trust, solidarity and common citizenship. It encourages those who have wealth and access to expert advice to avoid paying their fair share. It allows fat-cat salaries to be hidden from employees and other stakeholders. It undermines accountability, not least of Revenue itself. It breeds suspicion – compliant taxpayers are left to wonder whether they are fools and dupes for doing the right thing.
Making tax returns public would be an imaginative spark, a bold statement about the kind of society we want to be. A republic depends on laws and institutions, but it depends even more on what Irish philosopher and Princeton academic Philip Pettit calls the ability to look one another in the eye without reason for fear or deference – or, we might add, shame. A tax return isn’t just a set of numbers – it’s what allows us to look our fellow citizens in the eye knowing that we each honour our obligations to the common good. Instead of waving rifles or proclamations, we should proudly hold aloft our Form 11s.