Derek Nolan (Galway West, Labour)
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66. To ask the Minister for Finance if he will put a special task force in place to propose ways of restricting persons trading on the black market, and the consequent evasion of taxes, and the impact on the Exchequer and legitimate businesses; and if he will make a statement on the matter. [18748/15]

Michael Noonan (Limerick City, Fine Gael)
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My understanding of shadow economy (or black market) activity is that it is wide-ranging and it includes, not only illicit activity such as tobacco smuggling, oil laundering and counterfeiting, but also practices (much of which are facilitated within the cash economy) carried out by businesses such as suppressing sales and purchases, keeping cash payments 'off the books' and paying employees under an 'off the books' arrangement.  Also within the shadow economy are those who are working while at the same time claiming social welfare benefits.

Individuals and businesses that operate within the shadow economy gain an unfair competitive advantage compared to legitimate, tax compliant businesses and they deprive the Exchequer of much needed revenues.  The Deputy will be aware that I have introduced a number of specific measures in recent years aimed at countering the effects of shadow economy activity.  These include:

- the licensing regime for auto fuel traders which was strengthened with effect from September 2011 to limit the ability of criminals to get laundered fuel onto the market;

- a new licensing regime for marked fuel traders which was introduced in October 2012 and which is designed to limit the ability of criminals to source marked fuel for laundering;

- requirements in relation to fuel traders' records of stock movements and fuel deliveries to ensure data is available to Revenue assist in supply chain analysis;

- a 'reckless trading' provision in Finance (No. 2) Act 2013 that makes a supplier who is reckless in supplying rebated fuel for a use connected with excise fraud liable for the duty evaded;

- strengthened provisions in the Finance Act 2014 to permit Revenue to refuse or revoke a mineral oil trader's licence where the trader does not comply with excise law, does not maintain adequate stock management systems and records, or provides false or misleading information.

I am satisfied as regards Revenue's commitment to tackling shadow economy activity.  That commitment is evidenced by the following key statistics for 2014 that were recently published in the Commissioners' Annual Report for that year:

- over 437,000 compliance interventions yielding over €610 million;

- 6,158 drug seizures and seizure of 201,140 litres of illicit fuel;

- Seizure if 53.4 million cigarettes and 9,824 kg of tobacco, valued at €25.47 million and €4.22 million respectively.

The Commissioners' Annual Report also highlights the significant programme of work that is ongoing and aimed at specific aspects of the shadow economy including detection of fiscal fraud, smuggling and illegal drugs as well as targeting sectors of the economy that traditionally have been susceptible to shadow activity, specifically cash businesses such as the hospitality sector and white collar cash.I am satisfied that there is a high level of co-operation and joint working between the various State agencies who are charged with tackling the shadow economy and that the arrangements in place at an operational level are working effectively.

There is extensive co-operation between Revenue and An Garda Síochána in combating the illicit trades of tobacco and oil smuggling and the relevant agencies in the State also work closely with their counterparts in Northern Ireland, through cross-border groups to target the organised crime groups that are responsible for large proportions of these illicit markets.  There is also strong collaboration between Revenue, the Department of Social Protection and the National Employment Rights Authority as evidenced by joint operations in relevant sectors focusing on compliance in relation to employment taxes.  I am also informed that the Revenue website has recently been extended to include a shadow economy webpage where information to report such activity is provided.  Any information as regards shadow economy activity can be reported to Revenue, either via the Revenue website or directly (including anonymously) to any Revenue office.

The Deputy may be aware that the British Irish Parliamentary Assembly recently published a report on Cross-border Police Cooperation and illicit trade.  The report found that:

- the current level of cooperation between An Garda Síochána and the PSNI was excellent with evidence that both police forces worked closely together, formally and informally, on many issues.

- the joint Cross-border Policing Strategy, first launched in 2010, has contributed to the detection of criminal activity and better public safety across the island of Ireland by enhancing the policing capabilities of both police services.

- the Committee welcomed the development of the multi-agency Cross-border Fuel Fraud Enforcement Group and the Cross-border Tobacco Fraud Enforcement Group since its last inquiry.

Having regard to the legislative measures in place, the on-going work and focus of the Revenue Commissioners in tackling shadow economy activity in all its manifestations and the significant on-going cross-border cooperation between agencies, I do not propose to establish a special task force to tackle the shadow economy on the lines suggested by the Deputy.