Friday 18 April 2014

Revenue nets €82m cash from 'shadow economy'

Revenue Commissioners

REVENUE investigations into the shadow economy have yielded almost €82m in recouped cash for the Exchequer, it has emerged.

The sums were retrieved in the first eight months of the year as Revenue used covert surveillance, cold calls, tip-offs from third parties and localised blitzes to identify and swoop on non-compliant businesses making 'under-the-counter' transactions in cash.

Figures provided by the tax agency's Shadow Economy Project show that the largest sum, €21m, was recouped from landlords, while a further €18m was yielded from a category labelled "cash businesses".

A Revenue spokeswoman described tackling shadow economy activity as "a key corporate priority".

"We focus on sectors that have traditionally been susceptible to shadow activity, particularly cash businesses, citing the retail, hospitality and entertainment sectors as well as doctors, dentists, veterinarians, accountants and those involved in construction," she said.

The construction industry accounted for €17m of the cash recouped, while "white-collar cash" came to €16.5m.

Other categories included the security industry (€5m), couriers (€2m), nursing homes (€730,000), the solid fuels industry (€700,000), and garages (€460,000).

A total of €220,000 was recouped from scrap metal dealers, while jewellers and cash-for-gold outlets yielded €55,000.

The Revenue spokeswoman said that the sums involved related specifically to the Shadow Economy Project and "do not relate to total Revenue yields".

She also explained: "In general, failure to comply with Revenue obligations can present in a number of ways, ranging from unintentional errors to deliberate tax evasion.

"Shadow economy activity distorts the business environment, putting compliant business at a competitive disadvantage and depriving the Exchequer of much-needed funds.

"Revenue carries out compliance interventions to protect the Exchequer, to influence compliance behaviour and to support and protect legitimate trade," she added.


Shadow economy activity is often carried out by people and businesses already in the tax system and it can range from businesses and professions understating their sales/ income, underdeclaring cash payments or paying their employees off the books, to individuals doing 'nixers', either in addition to their normal taxed employment or while also claiming Department of Social Protection payments.

Businesses found to be non-compliant by Revenue investigators are requested, or, where necessary, compelled to regularise their tax and duty affairs.

Irish Independent

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