Dunnes Stores ordered to pay €8.53m over plastic bag levy

Gordon Deegan

The Tax Appeals Commission (TAC) has ruled that retail giant Dunnes Stores must pay an amended €8.53 million Revenue bill due to the plastic bag levy.

However, the bill is €28 million less than the original €36.57 million net aggregate assessment served on Dunnes Stores by the Revenue Commissioners for the environmental levy in 2009.

A 60-page TAC ruling on the 15-year-long tax dispute reveals that Revenue wrote to the TAC in November 2021 to say it had reduced the total amount of the levy bill on Dunnes Stores by €28 million, down from €36.57 million to €8.53 million.

In its November 2021 letter to TAC, Revenue said the bill was now €8.53 million pending a detailed review of the calculations supporting the assessments. The TAC ruling does not name Dunnes Stores.

The initial bill included plastic bags supplied at the check-out, while the revised assessment now only concerns ‘flimsy’ bags that are generally available to customers for food hygiene and safety purposes to contain products such as fish, meat, poultry, fruit and vegetables.

In the tax row, Dunnes Stores and Revenue were in agreement on the €8.53 million owed if the TAC was to find that the bags at issue are not ‘excepted bags’ under the relevant Waste Management (Environmental Levy) Plastic Bags Regulations 2001.

The €8.53 million bill concerns €4.6 million for July 2004 to June 2005 and €3.88 million for July 2005 to June 2006.

In its appeal against the revised Revenue bill of €8.53 million at the TAC, Dunnes Stores argued that no amounts were due in respect of the levy in respect of the plastic bags at issue.

Commissioner Claire Millrine found that, after a one-day hearing into the dispute in May this year, that the plastic bags at issue were not exempt from the levy and the €8.53 million assessment should stand. She concluded that the bag are not 'excepted bags' under the regulations.

In the initial aggregate €36.57 million bill, Revenue had given credit for payments of €15.3 million by Dunnes concerning the bag levy.

The TAC ruling comes four years after Dunnes Stores lost its Supreme Court appeal concerning the validity of laws under which the Revenue Commissioners raised the tax assessments of €36.5 million.

Ms Millrine stated that neither Dunnes nor Revenue had samples of the plastic bags at issue.

The dispute may yet be ultimately decided by the High Court as the TAC ruling discloses that it has been requested to state and sign a case for the opinion of the High Court in respect of the determination.