Revenue targets building fraud

A TAX fraud blitz on the construction industry was signalled last night to squeeze the €200m black economy operating on building sites.

Revenue Commissioners told the Dáil's Public Accounts Committee (PAC) the industry would be aggressively targeted by inspectors throughout 2006 in order to bring it to heel.

Revenue chairman Frank Daly said he was concerned about the level of tax evasion in the building sector.

"We will be devoting a lot of our resources to it next year. At least 20% 25% of our audit resources and interventions on compliance will be focused on construction next year," he said.

Green TD Dan Boyle questioned the way the building industry benefited from tax incentives.

"The Finance Department gives half a billion euro a year in relief to the building industry and the companies say the tax breaks given to construction leads to money being raised through other knock-on taxes, but this is the other side of that coin," he said.

Mr Daly also revealed a sharp increase in the number of convictions for smuggling of oil and tobacco.

PAC members heard the total amount of tax collected in 2004 increased to €35.8 billion, up €3.5bn on the previous year.

Special investigations by the Revenue clawed-in €2bn last year, €770m of which came from probes into offshore assets.

Outstanding tax being pursued stood at €1.2bn, down €146m on 2003.

The Revenue wrote-off taxes to the value of €172m, an increase of €50m on the year before.