The Revenue Commissioners believed that the large majority of interest earners were declining to report it and that the most efficient method to collect at least the basic rate tax would be to deduct it at source.
Some argued that it discourages saving among low-income families, who would not otherwise be liable for taxation, but who might also not understand the need to claim exemption.
[citation needed] In the late 1990s a parliamentary inquiry under Jim Mitchell, TD, established the existence of a culture of encouraging tax evasion within Irish banks, which had allowed wealthy customers to set up non-resident (off-shore, international) bank accounts into which money was transferred, enabling the account holder to avoid paying DIRT.
Several famous Irish people have been found evading the tax, including (former) Minister for Justice Pádraig Flynn.
[3][4] The Chairman of the inquiry was "shocked and horrified" at the "careless and reckless" manner in which the Governor had quoted false statistics to the Public Accounts subcommittee.