All future tax incentive schemes should be evaluated as to their likely costs and benefits, a Dáil committee said yesterday.

In an interim report on the Revenue Commissioners, the Public Accounts Committee also said that all future schemes should have mechanisms to enable monitoring of both the tax foregone and the benefits to be gained.

"While the committee acknowledges the progress that has been made in tackling tax evasion, it is timely for Revenue to establish from macroeconomic and other data, the scale of the shadow economy that currently exists."

The committee also recommended that the Department of Finance and the Revenue should put in place mechanisms for evaluating the effectiveness of changes introduced in the 2005 Finance Act, designed to support the pursuit of those aiding and abetting tax evasion. On the prosecution of tax evaders the report noted the low level of prosecutions being achieved.

It noted that the 1993 tax amnesty included a provision making it a requirement to avail of the amnesty if a taxpayer had untaxed income.

"It seems that having a substantial bogus non-resident account prior to that date and failing to avail of the amnesty is de facto an offence. If it has taken 10 years to even try a prosecution under it [the amnesty legislation], it seems there has been a failure somewhere along the line."

The report noted that the confidentiality assurances contained in the 1993 amnesty law were now a "handcuff" preventing the Revenue prosecuting persons suspected of having committed offences.

"The confidentiality clause . . . denies access to information needed to take a prosecution."