Revenue publishes 2022 Annual Report
Today (26/4/2023) Revenue announced the publication of its 100th Annual Report for 2022.
The report reflects a year of strong performance for Revenue with a record amount of tax and duty collected in 2022.
Alongside the 2022 Annual Report, Revenue also published a number of other reports, including research reports on Corporation Tax, Income Tax, VAT and VRT; summaries of the 2022 SME Customer Survey; the results of the Tobacco Products Research Survey 2022 and PAYE Statistics.
Commenting on today’s publications Revenue Chairman, Niall Cody, said:
“Revenue collected total gross receipts of almost €118 billion, including €22 billion in non-Exchequer receipts collected on behalf of other Government Departments, Agencies and EU Member States. Net Exchequer receipts of €82.4 billion were up by 22% or €14.9 billion on 2021.
Despite the challenging business environment, overall timely compliance rates remained strong across all taxes for 2022. This reflects the positive engagement by businesses, individual taxpayers and tax practitioners with tax compliance obligations and with Revenue during the year and the importance that society generally places on a strong culture of voluntary compliance.”
Commenting on Revenue’s core task of collecting taxes and duties on behalf of the State, Revenue Commissioner, Ruth Kennedy said:
“In light of the prevailing challenging economic situation facing businesses, we announced an important and significant extension to the Debt Warehousing Scheme (DWS) in 2022. This extended the support for businesses who experienced cash-flow and trading challenges as a result of the COVID-19 pandemic and energy crisis. Businesses will be aware that one of the key conditions of the DWS is that all tax returns must be filed so that the debt is quantified, and current taxes must be paid as they fall due.
Revenue also commenced a phased return to standard debt collection for non-warehoused debt, which had been partially suspended since the start of the pandemic in March 2020. This is designed to ensure that such debt is collected, ensuring a level playing field for all businesses, but our approach has regard to circumstances where taxpayers or businesses may continue to experience demonstrable cashflow difficulties impacting either their ability to pay non-warehoused debt, or their ability to meet ongoing tax obligations on a timely basis. In such circumstances it is critical that taxpayers engage with us at the earliest opportunity and work proactively with us to put in place an agreed payment solution, thereby preventing the need for enforcement of the debt.“
Commenting on the practical impacts of the UK being outside the EU’s Customs Union and Single Market, Revenue Commissioner and Director-General of Customs, Gerry Harrahill, said:
“Since 1 January 2021, goods that previously moved seamlessly between Ireland and Great Britain are subject to Customs formalities. This significant and permanent change in trading arrangements, which had previously operated since the creation of the EU Single Market, continues to create challenges and add to the cost of doing business. State agencies continue to be very actively engaged in optimising the flow of legitimate trade through our ports and airports, including maximising the collaboration between the agencies in respect of goods movements and consignments that are the subject of documentary or physical checks by the agencies.
The changed nature of the trading relationship with Great Britain arising from their departure from the EU, together with the broad and wide-ranging international dimension of the supply chain of goods imported into Ireland and the huge growth of eCommerce, have all contributed to the need for increased engagement and interaction between businesses and customs agents on the one hand, and Revenue’s Customs systems on the other hand, throughout 2022.
In 2022, we processed a record breaking 43 million customs declarations, 40 million of which were import declarations. This compares to just over 27 million import declarations processed in 2021 and 1 million in 2020. A key indicator of our success, and of the benefits of collaboration with business and cross agency collaboration, is that 89% of all freight vehicle movements from Great Britain into Ireland were green routed on arrival in Ireland, meaning they passed freely through the relevant port without the need for any additional interaction with Revenue or any other State Agency.
The UK has announced its plans to implement import controls later this year and next, and we will work closely with Irish businesses to ensure they have available to them all of the necessary information to deal with their import obligations into the UK and thereby facilitate the flow of legitimate trade.”
Local Property Tax
Commenting on Local Property Tax (LPT) compliance rates, Ms. Kennedy said:
“We saw high levels of activity throughout 2022 as property owners, including owners of newly liable properties which came within the annual charge to LPT for the first time, engaged with us to confirm ownership and set up payment arrangements ahead of the payment dates throughout the year.
We saw significant engagement and strong levels of compliance by property owners in advance of the November deadline, and indeed since. The return compliance rate for LPT for 2022 currently stands at 94%, while the payment compliance rate is 97%, showing the very positive engagement, by property owners, with their LPT compliance obligations.
For the remaining minority of property owners who haven’t yet paid, or made arrangements to pay, their LPT for 2023 I strongly encourage them to do so immediately.”
Income Tax Returns
Since PAYE Modernisation in 2019, there has been a pronounced increase in the numbers of PAYE taxpayers filing their Income Tax returns to claim their entitlements and declare any income not taxed through the PAYE system. In 2022, over 1.1 million Income Tax returns were processed in respect of taxpayers who filed their Income Tax return for 2021.
Commenting on Income Tax returns for 2022 which have already been filed, Ms. Kennedy said:
“As at 31 March 2023, over 810,000 tax returns had been processed in respect of PAYE taxpayers who have already filed their return for 2022, this is up over 26% on the same period last year.
All PAYE taxpayers have access to their Preliminary End of Year Statement for 2022 in myAccount. The statement sets out their pay, tax credits and overall tax position for the year, allowing them to file their return to correct or add to information in their record for the year with Revenue.
The quickest and easiest way to finalise your tax position is to submit the return online. Your return is pre-populated by Revenue with your payroll information and all other relevant information available to Revenue, including Department of Social Protection payments. It is simple to complete the return and filing online through myAccount is free and ensures you get the full value of any refund you are due.”
We implement a real-time, data driven risk assessment approach to our compliance work, which minimises the administrative burden on the compliant taxpayer and enables us to prioritise our compliance resources on the non-compliant taxpayer.
We use a proportionate response, based on taxpayer behaviour, to confront cases displaying non-compliance indicators and challenge aggressive tax planning. During 2022 we completed over 463,800 compliance interventions, yielding €813 million in tax, interest and penalties and agreed tax settlements amounting to €28 million with 36 taxpayers who were published as tax defaulters.
We also continued our broad range of risk-focused interventions targeting fraud, illicit trade, smuggling and organised crime. Commenting on Revenue’s primary responsibility for the prevention, detection, interception and seizure of prohibited and restricted goods and products, Mr. Harrahill said:
“We deploy a risk-based approach in our detection and intervention strategy and continued to collaborate with our national and international law enforcement partners to identify key players within the criminal fraternity and disrupt and dismantle their core supply chains during 2022.
Our enforcement teams operate at all main ports, airports and mail centres, as well as freight forwarding premises and our broad range of interventions resulted in the significant seizures during 2022, including:
- 3,600kgs of drugs, with an estimated value of €46.6 million
- 51.6 million cigarettes, valued at €39.5 million
- 11,803kgs of tobacco, with an estimated value of €8.5 million.
Our teams also participated in 69 controlled deliveries, which lead to 51 arrests, and 26 joint operations with the Garda National Drugs and Organised Crime Bureau.
Those involved in trading illicit goods and products have the capability and resources to adapt their methodologies quickly. We monitor developments as regards the increasingly inventive and complex smuggling methods and concealment techniques used by those involved in illegal activity and deploy and adapt our broad range of enforcement assets and capabilities in response.”
Delivering Government Supports
Commenting on Revenue’s role in supporting taxpayers through the current economic environment by delivering critical Government supports such as the Temporary Business Energy Support Scheme (TBESS), Mr. Cody said:
“The economic and social disruptions caused by the COVID-19 pandemic continued into 2022 and were further compounded by Russia’s invasion of Ukraine. The Employment Wage Subsidy Scheme (EWSS) and Covid Restriction Support Scheme (CRSS) were wound up in Spring 2022. During the period from March 2020 to May 2022 we provided critical support to businesses and employees, on behalf of the Government, of just over €10 billion. This was unprecedented activity for Revenue and involved innovation, agility and a huge level of commitment. We are really proud of our response to a national emergency.
To safeguard the integrity of the Temporary Wage Subsidy Scheme (TWSS) and EWSS, Revenue completed a programme of eligibility and compliance checks on those who received payments to ensure that the monies involved were properly paid out to employees. These checks confirmed a high level of compliance with the schemes.”
Other key features of Revenue’s performance in 2022
Other key features of Revenue’s performance in 2022 included:
- 1.7 million telephone calls answered and 3.9 million items of correspondence dealt with
- Supporting compliance for 0.2 million employers, 0.8 million businesses, 0.3 million VAT traders, 0.1 million Customs traders and 1.3 million property owners
- 12.5 million electronic payments made to Revenue, with a value of €111.9 billion
- 1.6 million electronic repayments made to taxpayers, with a value of €11.4 billion
- 99% timely compliance rates for large sized businesses and 97% for medium sized businesses
- Facilitating 9,899 business and individuals in entering Phased Payment Arrangements covering €192 million debt.
Looking towards the future, Mr. Cody said:
“2023 marks a century of carrying out Revenue’s Mission - ‘To serve the community by fairly and efficiently collecting taxes and duties and implementing customs controls’. As we embark on our next century of operations, we will continue to tailor and refine our service to support compliance based on taxpayers’ and tax agents’ needs and further advances in technologies.
While the economic impacts of COVID-19 have eased, we remain alert to the risks arising from the changes in the economic and business environments both nationally and globally. We are also acutely aware of the challenges facing the economy as regards continued security of supply chains, the cost-of-living crisis and Russia’s invasion of Ukraine. We will remain proactive in addressing these risks and will continue to play our part in supporting the national response to these challenges.
The efficient collection of taxes and duties due to the State continues to be Revenue’s primary role and focus. Timely tax return and payment compliance remains a priority for us, including for those businesses who have availed of the DWS and for whom timely compliance remains a key condition of their ability to continue to avail of the scheme.
We will continue to enhance our real-time engagement and interventions and response to risk. This will be achieved by embedding our Compliance Intervention Framework (CIF) into our compliance management approach to ensure that our response and actions are determined based on the level of risk and taxpayer behaviour.
We will provide comprehensive guidance and support to property owners in advance of the first chargeable period for the Vacant Homes Tax (VHT) and the Residential Zoned Land Tax (RZLT), and will continue to support business and trade as they adjust to the UK Government’s import requirements.
The implementation of Blended Working arrangements was a key Corporate Priority for Revenue in 2022 and we will continue to facilitate a mix of on-site and virtual working in a way which maximises flexibility and enhances the wellness and a better work-life balance for our people. We will also maintain our strong focus on the wellbeing, diversity and inclusivity of our people, achieving our vision to be an employer of choice for both our existing staff and prospective new recruits.
Finally, Commissioners Harrahill and Kennedy and I would like to thank all Revenue staff for their professionalism, dedication and commitment without which our achievements in 2022 would not have been possible. We also acknowledge and thank those Revenue staff, including Commissioner Mick Gladney, who retired during the year, many of whom dedicated 40 or more years of service to the State.”