Sources Of Revenue Law Topic 2 Notes

SOURCES OF REVENUE LAW/ RULES OF INTERPRETATION (TOPIC 2).

- Tax Evasion: Simply where you don’t bother paying tax = IILEGAL.

- Tax Avoidance: This is entirely LEGAL and you can’t get into legal difficulty. It is the action of structuring business affairs to reduce or eliminate tax bills, basically finding the loopholes that are there. It is however, morally wrong to engage in tax avoidance but not illegal.

- Tax Laws are heavily based in the Legislation, Article 22 of the Irish Constitution states that the legislator (Oireachtas) is the only power which can sign off on taxes.

-Taxes Consolidation Act 1997 ( Main Legislation)

- Annual Finance Acts.

- Capital Acquisitions Tax Consolidation Act 2003.

- Stamp Duty Consolidation Act 1999.

- VAT Consolidation Act 2010.

- When it comes to a piece of legislation then the interpretation of its provisions is of the utmost importance.

- Overall rule is that the words are to be given their ordinary meaning; Inspector of Taxes v. Kiernan [1981]: This case involved the meaning of cattle whether it also included pigs. Going back to the ordinary meaning pigs had not been included. If the Act is directed towards some type of specialist activity then it can be given its specialised meaning and not expanded beyond that.

STATUTORY INTERPRETATION.

CANONS OF CONSTRUCTION:

- The Literal Rule: Kiernan case, literal reading of the word to be adhered to regardless of how absurd the result may be.

- The Golden Rule: This rule becomes applicable where the literal reading produces an absurd result, then the reading under this rule will prevent somewhat the absurdity but is inconsistent with the Statute.

- The Mischief Rule (Purposive Approach): Here a determination will be made as to the intention of the Statute as a whole and the particular provision is distinguished from the overall intention of the Statute. This approach is quite inconsistent as different people will create their own subjective idea as to the intention of a provision and on foot of this inconsistency this rule is seldomly used.

-Historically, there was always a stringent literal approach taken of the provisions and this was beneficial to tax avoidance.

- Cape Brandy Syndicate v. IRC: Rowlatt J reasserts the fact that when it comes to tax you only look to what was said, nothing is to be read into or implied.

- Partington v. AG: Here it was...

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