ABOUT £1 million has been collected in tax on income from "unknown" and "unlawful" sources since 1983, the House was told.

The Minister for Finance, Mr Quinn, said there were many difficulties in establishing a tax liability against those engaged in drug trafficking or any illegal activity. Such people did not wear the normal badges of trade. There were no records and banking arrangements were carefully concealed.

Where hard information was received, from the Garda or otherwise, which showed that these people had a lifestyle inconsistent with their declared income, Revenue would pursue them for tax assessment purposes.

The legal difficulties involved in attributing illegal profits to a particular source had been recognised in the Finance Act 1983 which reflected rulings by the Supreme Court in this sensitive area. That Act provided - that profits arising from such a source would be assessed as "miscellaneous income". The Revenue did not have to prove that the profits derived from drug trafficking, and would be unlikely to be able to do so.

The Revenue and Garda had been reviewing recommendations by the Law Reform Commission in regard to co operation between the two bodies. A report on this review would be completed shortly.

Mr Quinn was responding, at question time, to the Fianna Fail spokesman on finance, Mr Charlie McCreevy who said there was a marked reluctance by the tax authorities to pursue well known criminals.

Mr Quinn said the Revenue chairman informed him there was no such reluctance. Anyone with information should give it to the Garda or to him and it would be passed on to the Revenue.