HMRC clampdown provides results |
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| Finance | |
| Written by Paul Williams | |
| Monday, 26 April 2010 | |
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64% jump in tax clawed in through compliance work since 2005/06 driven by ‘no mercy’ approach. HM Revenue & Customs (HMRC) has clawed in a total of £39.5 billion from tax investigation work since April 2005, the date when HM Customs & Excise and the Inland Revenue merged, says UHY Hacker Young, the national accountancy group. In the first 12 months of its existence (2005/06) HMRC generated £7.4 billion through its tax enquiries and other compliance work, but this jumped 64% to £12.1 billion in the most recent year (to March 31 2009).UHY Hacker Young says that since coming into existence, HMRC has continuously sought tougher and more intrusive powers, such as the power to make arrests, to enter business premises unannounced and to demand confidential information on taxpayers from third parties. UHY Hacker Young adds that the steep rise in extra tax acquired through compliance investigations is also partly a reflection of the increasing number of mistakes being made by taxpayers as the tax system grows ever more complicated. Comments Roy Maugham, Tax Partner at UHY Hacker Young: “The amount of money that HMRC is taking in through compliance work is huge but this hasn’t come without significant costs to innocent taxpayers.” “Since HMRC’s formation the Inland Revenue side of the Department has been lobbying to gain the draconian powers that Customs have to deal with the threat of drug smugglers and arms dealers. The result is that HMRC now has sweeping powers to enter business premises to conduct a search without warning beforehand and to make arrests without the need to be accompanied by a police officer.” “HMRC is also using increasingly controversial methods to tackle tax evasion. Purchasing offshore bank account details that have been stolen by criminals, for example, now seems a perfectly legitimate tactic to HMRC.” “With the current state of the public finances HMRC’s aggressive stance on tax investigation work is likely to become ever tougher.”
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