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Wednesday 6 December 2023 Dublin: 5°C
Leah Farrell/Rollingnews Social Democrats' Catherine Murphy with co-leader Roisin Shortall.

Catherine Murphy: Revenue's relaxation of residency rules for Irish tax exiles is 'tone deaf'

Normally, citizens who have chosen to live abroad for tax purposes can spend no more than 182 days a year living in Ireland.

THE CO-LEADER OF The Social Democrats has raised concerns about the “relaxation” in the residency rules for Irish tax exiles as a result of the ongoing coronavirus crisis. 

Catherine Murphy described Revenue’s decision to allow non-residents in Ireland to avoid paying tax if they’ve been prevented from leaving the country due to Covid-19 as “tone deaf”. 

Normally, people have to spend more than 183 days in the country to be liable for taxes but Revenue waived that due to the exceptional circumstances that have arisen from the pandemic. 

Murphy told Morning Ireland she thinks it’s “the strangest decision” and doesn’t know what prompted Revenue to make it. 

“Essentially, there’s a high degree of social solidarity being displayed at the moment and taxation is the essence of social solidarity.

“We collectively pay our taxes and then in return, we get our public services like health, like our social welfare system.

Under guidelines issued by Revenue, individual will not be regarded as being present in the State for tax residence purposes for the day after the intended day of departure “provided the individual is unavoidably present in the State on that day due only to ‘force majeure’ circumstances”. 

“Where a departure from the State is prevented due to Covid-19, Revenue will consider this ‘force majeure’ for the purpose of establishing an individual’s tax residence position,” it stated. 

Murphy said this relaxation was “really tone deaf” given the current climate. 

This is a very generous system which allows people to be out of this country for six months of the year and the guidelines are saying that can be relaxed even further for this covid crisis. 

“Essentially people have to pay taxes if they’re going to get services and there are people today worried about whether they’ll have a job to go back to, whether or not they’ll have a business to open,” Murphy said.  

“And it just seems like the strangest of decisions, a really tone-deaf decision, to be announcing the relaxation of these guidelines.”

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