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A €200,000 levy on high income earners who claim non-resident tax status will not raise any money this calendar year.
In this year's Finance Act the government said any Irish citizen who had a worldwide income of more than €1m and Irish-located assets valued at €5m would pay €200,000 a year to the Revenue Commissioners. Finance minister Brian Lenihan told the Dáil last week that he couldn't estimate how much it will generate.
"It is not possible to estimate the number of non-residents that this measure will affect. Many non-resident individuals who file Irish tax returns are not Irish citizens or have a foreign domicile and therefore would not be subject to the levy," Lenihan said in a reply to a parliamentary question by Labour's Roisin Shortall.
There will be no gain this year from the introduction of the levy. The so-called 'domicile levy' will "be charged for 2010 and subsequent years, but the payment for each year can be made at any time up to 31 October in the year following the valuation date, which is 31 December of each year".
That means that some payments for this tax year may not be paid until October 2011.
It isn't known how many individuals will be subject to the levy but it is believed that it will only apply to several hundred of the country's 6,000 tax exiles.
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The levy is a small start in the right direction but, ideally (if this is allowed by EU law etc.), all Irish citizens should be obliged to file tax returns as in the US. In addition, the names of all tax exiles should be made public. One can hardly ask the middle classes to tighten their belts and leave the richest among us unscathed. Most citizens living abroad are already paying substantial taxes and should be asked for only a nominal sum - it's the high net worth guys residing in low-tax havens who should be targeted, irrespective of where their income is made. I suspect that some of these individuals would pay a fairly heavy price to be able to continue calling themselves Irish.