Shane Coleman v Revenue Commissioners

JurisdictionIreland
JudgeMs. Justice Donnelly
Judgment Date25 November 2014
Neutral Citation[2014] IEHC 662
CourtHigh Court
Date25 November 2014

[2014] IEHC 662

THE HIGH COURT

[No. 863 R/2013]
Coleman v Revenue Cmrs
REVENUE
SHANE COLEMAN
APPELLANT

AND

THE REVENUE COMMISSIONERS
RESPONDENTS

Income tax – Exemption – Arts – Respondents seeking to have a question of law answered – Whether the Appeal Commissioner was correct in holding that the appellant”s book qualifies for the exemption from income tax

Facts: The appellant, Mr Coleman, is the author of Foot in Mouth – Famous Irish Political Gaffes, a work of non-fiction. The respondents, the Revenue Commissioners, decided that this work did not qualify for the artist”s exemption from income tax provided by s. 195 of the Taxes Consolidation Act 1997. That exemption is governed by guidelines drawn up by An Comhairle Ealaíon (The Arts Council) and the Minister for Arts, Heritage, Gaeltacht and the Islands with the consent of the Minister for Finance in accordance with the provisions of s. 195(12) of the Act of 1997. Mr Coleman appealed that decision on a ground that is no longer at issue in the proceedings. In February, 2008, the Appeal Commissioner determined the appeal in Mr Coleman”s favour by holding that he was entitled to the artist”s exemption on the ground that his book came within the category of biography. The Revenue Commissioners appealed to the High Court and were heard in October, 2014. The question of law posed by the Appeal Commissioner for determination by the High Court was whether he was correct in holding that the appellant”s book qualifies for the exemption from income tax in that, as non-fiction, the book satisfies the requirement of paragraphs 9(i) and (ii) of the guidelines in force under the provisions of s. 195(13)(b)? The Revenue Commissioners contended that the Appeal Commissioner reached conclusions such that no reasonable Appeal Commissioner could have arrived at, or reached conclusions based on a mistaken view of the law. The Revenue Commissioners submitted that the requirements of para. 9 (ii) of the Guidelines for the work to be regarded as pioneering were not satisfied. Mr Coleman argued that the book was both original and creative and had cultural or artistic merit. Mr Coleman submitted that the Appeal Commissioner”s finding that the book was a set of mini-biographies was correct.

Held by Donnelly J that, having considered s. 195, Ó Culacháin v McMullan Brothers [1995] 1 IR 217 and the reasoning of the Appeal Commissioner, the Revenue Commissioners and Appeal Commissioner were bound by the provisions of s. 195 to apply the section and the Guidelines made thereunder; to disapply the clear and ordinary meaning of the words therein in favour of a similar approach that it was believed by the Appeal Commissioner that the Revenue Commissioners had taken with respect to Mr Finlay”s book, was wrong in law. Donnelly J held that the Appeal Commissioner”s original clear finding of fact, that Foot in Mouth was not an actual biography in the normal sense of that word, must stand; the ordinary meaning of biography is as a matter of law the correct interpretation. Donnelly J held that the Appeal Commissioner was not entitled to expand or alter the meaning of biography by reference to what he perceived as free interpretations of the statutory code by the Revenue Commissioners in another taxpayer”s case. On the basis of the primary finding of fact of the Appeal Commissioner that Mr Coleman”s book is not a biography, it was held to be clear that it was incorrect in law for him to then hold that Mr Coleman was entitled to an artist”s exemption on the basis of the book being biography under Appendix A of the Guidelines. In light of this determination, Donnelly J held it to not be necessary to consider whether the Appeal Commissioner was correct in law in holding that the book was a pioneering work as outlined in paragraph 9 (ii) of the Guidelines.

Donnelly J held that the answer she would give to the question of law posed by the Appeal Commissioner for the determination of the High Court is no.

Judgment approved.

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JUDGMENT of Ms. Justice Donnelly delivered the 25th day of November 2014

Introduction
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1. The appellant ("Mr. Coleman") is the author of Foot in Mouth - Famous Irish Political Gaffes, It is an entertaining and informative read. Mr. Coleman has written in amusing yet illuminating detail about political events of a certain infamy that have arisen since the foundation of the State. No doubt it succeeds in reaching out to a wider audience than those immersed in the minutiae of politics. It is clearly a work of non-fiction.

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2. The respondents ("the Revenue Commissioners") decided that this work did not qualify for what is commonly known as the artist's exemption from income tax provided by s.195 of the Taxes Consolidation Act 1997 ("the Act of 1997"). That exemption is governed by guidelines drawn up by An Comhairle Ealaíon (The Arts Council) and the Minister for Arts, Heritage, Gaeltacht and the Islands with the consent of the Minister for Finance in accordance with the provisions of s. 195 (12) of the Act of 1997 ("the Guidelines").

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3. Mr. Coleman appealed that decision on a ground that is no longer at issue in these proceedings. On the 15 th February, 2008, the Appeal Commissioner determined the appeal in Mr. Coleman's favour by holding that he was entitled to the artist's exemption on the ground that his book came within the category of biography.

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4. It is against that determination of the Appeal Commissioner that the Revenue Commissioners have appealed by way of case stated. There was a lengthy procedural delay before the case stated was finally signed on the 18 th October, 2013. The case stated was duly transmitted to the High Court and was heard on the 9 th October. 2014. Understandably, Mr. Coleman queried the length of time it had taken to reach the High Court. It is undoubtedly true that the time taken for the case to be stated was excessive. It is incumbent on all involved, including the Appeal Commissioners, to ensure that cases stated are drafted and signed within a reasonable time. As the issue was not directly before me, I express no view as to whether and possibly more to the point, on what basis, a taxpayer would be entitled to prohibit the stating of a case on the grounds of excessive delay. As it came before me on a case stated, it appears I am required to proceed to determine the case in accordance with the statutory provisions.

The question of law
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5. The question of law posed by the Appeal Commissioner for determination by this Court is as follows:-

"…whether I was correct, under the terms of section 195 of the Act of 1997, in holding that the appellant's book Foot in Mouth - Famous Irish Political Gaffes qualifies for the exemption from income tax provided by section 195 Taxes Consolidation Act, 1997 in that, as non-fiction, the book satisfies the requirement of paragraphs 9(i) and (ii) of the guidelines in force under the provisions of section 195 (13)(b) of the Act of 1997?"

The statutory framework
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6. Section 195 of the Act of 1997 is less than straightforward in the manner in which it is drafted. Nonetheless, the relevant parts can be distilled. Subsection 1 defines "work" as meaning an "original and creative work" within certain defined categories, one of which is a book or other writing. Subsection 2 details that the exemption from income tax provided by the section applies to a "work" which has "cultural or artistic merit". The Guidelines drawn up under subs. 12 (a) of the Act of 1997 are for the purposes of determining whether a work is original and creative and whether it has or is generally recognised as having cultural or artistic merit. Subsection 13 (a) provides that the Revenue Commissioners shall not determine that a work is original and creative or has, or is generally recognised as having, cultural or artistic merit unless it complies with the Guidelines for the time being in force under subsection 12. Subsection 13(b) provides that subs. 13 (a) shall with any necessary modifications, apply to, inter alia:-

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(i) a determination by the Appeal Commissioners…

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(ii) to the extent necessary, to the determination by the High Court of any question of law arising and specified in the statement of a case for the opinion of the High Court, by the Appeal Commissioners

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7. The Guidelines drawn up in accordance with the provisions of s. 195(12) are not challenged in these proceedings. They represent the applicable law. Indeed, under the terms of s. 2 of the Interpretation Act 2005 these Guidelines come within the definition of a statutory instrument.

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8. Paragraph 9 of the Guidelines provide as follows:-

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2 "9. A non-fiction work in category (a) a book or other writing, will be considered original and creative only if,

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(i) it comes within one of the categories cited in Appendix A (emphasis added), and

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(ii) the essence of the work is the presentation of the author's own ideas or insights in relation to the subject matter, and the ideas or insights are of such significance that the work would be regarded as a pioneering work casting new light on its subject matter or changing the generally accepted understanding of the subject matter."

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9. Appendix A of the Guidelines, in so far as relevant provides as follows:-

"Non-fiction categories applicable to be considered as eligible for a determination under Section 195."

1. The following categories of literature (and any combination thereof) coming fully within the terms of reference of the Arts Council encompassing the subjects of fiction writing, drama, music, film, dance, mime or visual arts, and related commentaries by bona fide artists:

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· Arts criticism;

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· Arts history;

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· Arts subject works;

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· Arts diary;

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· Autobiography;

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· Belles-lettres...

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