Catherine Murphy (Kildare North, Independent)
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To ask the Minister for Finance the estimated loss to the Exchequer of tax returned in the years 2011 and to date in 2012 from black market activities; the sectors that have been identified as the main offenders; the action that has been adopted to date to curtail black market activities; the return on such activities; and if he will make a statement on the matter. [50235/12]

Michael Noonan (Limerick City, Fine Gael)
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I am advised by the Revenue Commissioners that they are very mindful of the unfair competitive advantage to be gained by those businesses that do not fulfil their tax obligations. Revenue’s tax and duty compliance programmes are under constant review to ensure that they are focussed on the areas of greatest risk, including risks from the shadow economy. Regarding the estimated loss to the Exchequer in 2011 and to date in 2012, I am informed by the Revenue Commissioners that given the nature of the shadow economy, there is no reliable system to measure the tax loss due to shadow economy activities. I am further informed that Revenue tackles the problem of the shadow economy through a range of compliance and audit interventions including targeted special projects. A variety of methodologies are used by Revenue to identify those who are operating in the shadow economy including covert surveillance, cold calls to businesses and venues as well as prearranged aspect queries on specific items. In addition, joint operations are conducted with the Department of Social Protection using Joint Investigation Units and there is a strong focus on cash businesses, given its potential high-risk nature.

I am confident that the Revenue Commissioners are pursuing a programme that is dealing in a very determined way with tax evasion in all its forms. In 2011, Revenue committed additional resources to tackling tax evasion in high-risk sectors and carried out over 11,000 audits and more than 546,000 assurance checks which between them yielded more than €483 million. Included in these numbers are the results of a particular focus on shadow economy activity in certain sectors:

- Construction: 1,833 audits yielding €58.8m

- Bars and restaurants: 613 audits yielding €16.9m

- Legal activities: 142 audits yielding €4.6m

- Landlords/rental properties: 908 audits yielding €35.1m

- Professionals (accountants, doctors, dentists): 350 audits yielding €8.9m.

Revenue also prioritises the tackling evasion of taxes and duties in the oil and tobacco sectors. In 2012 to date, eleven oil laundries have been detected and in excess of one hundred and ninety nine thousand litres of fuel have been seized from these. Also, to date this year, thirty-eight filling stations have been closed down. During 2011, Revenue’s Customs Service seized a total of 109m cigarettes from 10,581 seizures. Commercial quantities in maritime freight traffic accounted for 76.4m cigarettes. Revenue also seized 11,158kg of tobacco in 2011.

Finally, I am further advised by the Revenue Commissioners that they hold regular meetings with trade and representative bodies through The Hidden Economy Monitoring Group where the risks posed by shadow economy activities are discussed. The Deputy should also note that changes are frequently made in tax legislation aimed at counteracting shadow economy activity. Two recent examples are the introduction of the electronic Relevant Contracts Tax regime and an enhanced penalty regime for employers who fail to operate PAYE regulations fully.