The Law Reform Commission has come out against the establishment of a special court for trying Revenue cases.

It has also decided it would not be in favour of the creation of a Director of Fiscal Prosecutions, separate from the Director of Public Prosecutions, who again would specialise in Revenue offences.

The suggestion that both agencies might be established arose in the third DIRT report compiled by the Dáil Committee of Public Accounts.

The recommendations against the agencies being established are provisional and are contained in a consultation paper, which the commission published yesterday.

The paper is published to serve as a basis for discussions with interested parties before the commission issues its final report.

The consultation paper comprises more than 250 pages, which review the history of tax collection in the State and specific aspects of the law as it affects the Revenue.

The commission decided that recent changes to arrangements in relation to the prosecution of Revenue offences should be given a trial period to prove their efficacy.

It also decided that the current avenues of appeal against the Revenue - the Appeal Commissioners and the Circuit Court - have the advantage of being accessible forums for taxpayers challenging tax assessments. The commission also decided that Revenue trials on indictment should continue to be heard before a jury.

It decided that the creation of a specialist Office of the Director of Fiscal Prosecutions would result in the fragmentation of the public prosecution system and that the disadvantages of this would not be outweighed by any increase in the number of prosecutions.

In relation to civil penalties, the commission recommends that, in future, the tax defaulters' list, which is published quarterly in Iris Oifigiúil, should also be published in at least two national newspapers.

It believes there has been a drop-off in the effectiveness of the "name and shame" policy in recent years.

The consultation paper reviews the performance of the Revenue over the years and considers the issue of confidence in the Revenue.

"Part of the inspiration for this paper was undoubtedly the growing awareness that some members of the higher echelons of Irish society had successfully evaded tax when high taxes had been afflicting Irish society," the report states at its outset.

The paper considers the arguments in favour of a Serious Fraud Office along the lines of the one in Britain but does not recommend the creation of such an office.

It says the 1993 tax amnesty "encouraged much cynicism about short-term expediency and unfair favouring of the sector culpable of often deliberate long-term tax evasion".

It says the 1994 Beef Tribunal "discovered massive tax evasion at Goodman International and its subsidiary companies. . . The Revenue Commissioners did not discover the tax evasion scheme until the evidence was uncovered by the tribunal".

It says studies have estimated the black or shadow economy to be equal to 5-17 per cent of gross national product.

Until recently "the political will did not exist for establishing the extent of the shadow economy".

The report says "that insofar as such matters may be judged, a moral shift in relation to the attitudes to tax evasion began to occur in the late 1990s".

"There was a perception that if defaulters did not take advantage of this amnesty they did not deserve a second chance."