The Act

• The Tax Consolidation Act of 1997 was carried out under the direction and advice of the then finance minister, Ruairi Quinn, who declared in his budget speech in January 1995 that the time had come to amend the existing law on taxation. Quinn gave an impassioned speech in which he declared that the goals of the act were to simplify tax administration and tax legislation. His aims were to consolidate all the existing tax laws, including income tax, corporate tax and capital gains taxes. Two years and 10 months after his speech, the act was signed into law, on Nov. 30, 1997.
  
  

History

• The Tax Consolidation Act of 1997 was one of the most sweeping set of taxation reforms carried out in Ireland's history. In scale and breadth, it is the largest enactment in Irish history, with the full text running into 1,518 pages. The act was passed in view of the numerous challenges and difficulties that the common man and corporate entities alike faced in matters of taxation.
  
  

Purpose

• The tax act sought to restructure the entire system of taxation in Ireland by creating a partnership between the Revenue Commissioners, Office of the Parliamentary Draftsman and private tax practitioners. The purpose of the partnerships was to simplify the way tax law was written, and the way taxes were assessed and collected.
  
  

Goals

• The need for an act of this magnitude existed because the previous Act of Parliament aimed at consolidating taxation laws was carried out in 1967, 45 years after Irish independence. The government felt that most of the provisions of the existing 1967 laws on taxation were outmoded and in need of major updating. Following the 1967 consolidation of tax rules, there was a significantly high number of tax acts and schedules. There existed no fewer than 40 different acts and 2,000 sections covering income tax, capital gains tax and corporation tax. These made the application of the taxes under their relevant sections very cumbersome and time consuming. The aim of the 1997 Tax Consolidation Act was to bring about uniformity and consolidation into these laws.
  
  

Effects

• The effects of this legislation have been felt primarily in two areas. The volume of income tax, capital gains tax and corporation tax has fallen to half. Secondly, as a result of the major simplification of the existing tax system, tax legislation and its application in day-to-day matters has become organized. The act has brought about major changes in the way the government partners with the private sector, such as streamlining various tax-related systems for businesses, tax administrators and taxation practitioners. Although amended in subsequent acts of parliament, the core of this legislation has remained unchanged.