Quigley believes £17 billion in 200,000 non-residential accounts

The Revenue chairman, Mr Quigley, told the Public Accounts Committee that at present there are 200,000 non-resident accounts in the Republic, holding between them about £17 billion.

He said this compared with the £43 billion held in resident accounts. He said the ratio between resident and non-resident accounts would be be about the same in all financial institutions.

He did not comment on how many of the non-resident accounts might be bogus.

Many businesses would hold legitimate offshore accounts as part of their trading activities, while they could also legally be held by people resident outside the State.

Mr Quigley said the increase in overseas companies locating in the Republic accounted for a growing proportion of non-resident accounts. Talking about how non-resident accounts operate, he said the "primary onus on making a truthful declaration is on the taxpayer".

He added that "there is clear onus too on the banks to take reasonable steps to satisfy themselves that the person claiming to be the beneficial owner of the interest is non-resident".

The Revenue chairman indicated that there were fears during the 1980s that too tough a crackdown on bogus non-resident accounts could lead to a massive outflow of funds from the economy and destabilise the financial system.

He said it was well known that there were concerns, "especially in the mid-to late 1980s, about the existence of bogus non-resident accounts and the risks of outflows of funds from the economy, depending on the action taken to uncover such accounts".

The tax amnesty was introduced in 1993 as a device to encourage taxpayers to "clean" money not declared to the tax authorities. Much of this was money in bogus non-resident accounts within the State, as well as funds held outside Ireland.

In total, some £1.5 billion in unpaid tax was declared as part of the incentive amnesty in 1993, under which taxpayers paid 15 per cent of the outstanding liability in full settlement. Mr Quigley would not comment yesterday on how much of this related to bogus non-resident accounts, but reliable sources say that much of the money declared in the amnesty was in such accounts inside the State.