H.M.Revenue and Customs have released new figures showing that they have collected more than £200m in additional tax, following more than 80 taskforce inspections in the last three years.
Among those targeted by the taskforces since 2011 were grocers, second-hand car dealers, hairdressers, plumbers and lawyers, who had been tracked down using the HMRC’s own specialist software, which targets parts of the economy where evidence of tax evasion exists.
The amount claimed back from tax evaders during the operations is thought to be equal to around one per cent of the UK’s outstanding debt (£35 billion), which raises the question are taskforces actually working.
One rough rule is for every pound that a tax investigations cost 10 pounds is collected, which would tend to suggest they do have a cost effective impact on the collection of outstanding tax.
However, it is often argued that their main success is stopping people evading tax in the first place and getting those who do to own up to tax owed in return for generally more lenient treatment.
“By using targeted intelligence our taskforce teams are able to focus on those at highest risk of deliberately evading the taxes they owe,” an HMRC spokesman told Accountancy Web. “In so doing, taskforces are helping to provide a level playing field for the honest majority.”
A survey conducted by Accountancy Web found that aid the taskforces were a good idea and getting good results. However many questioned whether the taskforces are worth the effort given the relatively small sums some collect. Others claim the taskforces are primarily a publicity campaign for HMRC.
“We get about 7,000 tax helpline enquiries from 3,500 firms a year but we have only seen a ripple from HMRC taskforce interventions,” said Ben Chaplin, managing at director, Taxwise, which provides “fee protection” insurance for accounting firms. “Taskforces are mainly for PR. They don’t have much impact, but are more for the deterrent value.”