Derek McDowell
Question:38 Mr. D. McDowell asked the Minister for Finance the estimated loss to the Exchequer in terms of unpaid taxes arising from the so-called black economy; and if he will make a statement on the matter. [14768/95]
Written Answers. - Unpaid Taxes.
It has not proved possible to design a tool which is capable of computing irregular economy activity with any level of certainty as all available techniques for estimating the magnitude of the irregular economy suffer from significant limitations. I have no figure, therefore, for the estimated loss as requested by the Deputy.
Countering tax evasion in the irregular economy is a major focus of every tax administration in the developed world, including Ireland. While, as in all other countries, there is a recognition that unrecorded activity is unlikely to be eradicated, the Revenue Commissioners advise me that the general rate of tax compliance is responding positively to counter-evasion programmes.
Since it is difficult to measure the size of the irregular economy it is equally difficult to measure the impact of programmes aimed at curbing it. The growth in the numbers engaged on audit work in Revenue, the increase in audits conducted and the additional yield from these audits indicates the growing ability of the programme to penetrate the irregular economy. Revenue have also targeted particular sectors for detailed examination. The special inquiry branch of the Revenue Commissioners in Dublin and similar units in provincial districts continue to identify cases who fail voluntarily to register for tax.
The Revenue Commissioners assure me that their programmes to counter the irregular economy are yielding progressively more satisfactory results. Measures taken in this year's Finance Act in relation to supply of information by landlords and others and the wider use of RSI numbers will assist in this task.