The High Court has refused Dunnes Stores’ challenge to Revenue assessments claiming €36,573,727 in plastic bag levies for four accounting periods from July 2004 to June 2008.
In a judgment delivered on 13 December 2011, Mr Justice Hedigan rejected the retailer’s arguments that the levy applied only to carrier bags supplied at checkout and did not cover flimsy bags used for wrapping or hygiene. The court held that the levy applied to plastic bags supplied in supermarkets, shops and service stations, except those falling within the exemptions set out in the regulations.
Dunnes Stores had sought to quash assessments notified on 12 November 2009, along with declarations on the levy’s scope and the validity of the regulations and enabling legislation. It also argued that Revenue had not given enough information about how the assessments were calculated to allow an effective appeal.
The judge read “or otherwise” in the charging provision as extending the levy beyond bags supplied at the point of sale. He said the exemptions for certain bags used to contain food would make little sense if the levy covered only checkout bags. He also rejected the claim that the Minister had to identify narrower classes of sales outlets, finding that the regulations could apply to all such outlets.
On fair procedures, the court accepted that Revenue was required to act fairly but found no breach in this case. The judgment noted that Dunnes Stores and its professional advisers had extensive communications with Revenue, and that Revenue officials had provided assessment calculations and addressed queries at a meeting in November 2009. The court also held that Article 6 of the European Convention on Human Rights did not apply to tax assessment proceedings.
The retailer’s constitutional challenge to the Minister’s power to adapt tax legislation for levy collection also failed. The judge found that Dunnes Stores had not shown how it was adversely affected by that power and therefore lacked standing to challenge it. He added that the adaptation did not amend the tax legislation and that the governing Act set out the principles and policies, with regulations supplying the mechanics.
The court refused all relief sought. The judgment does not state the outcome of any separate appeals against the assessments.