HM Revenue and Customs “Unacceptably Slow” At Recovering Tax
Today (18th November 2014), the Public Accounts Committee have published their report into improving tax compliance. It concluded that HMRC has made little progress into recovering the highly publicised unpaid tax from multi-national firms and wealthy individuals. It also concluded that they have overstated their success at recovery through a £1.9 billion calculation error. Margaret Hodge, the Chair of the Committee, stated that;
“HMRC must do more, faster. It should report on the progress it has achieved by using new powers granted by parliament to tackle tax avoidance and show it is using its existing powers with sufficient urgency,”
If this report is contextualised through some of the key losses reported for 2012/2013, the issue appears more shocking. The oft-quoted ‘main problem’ of benefit fraud accounted for £1.2 billion. In contrast, tax avoidance was £5 billion. Starbucks paid no tax on sales of £400m. Amazon, which reported sales of £3.35billion only declared £1.8m tax. Google’s UK turnover was £395million compared to £6million paid. Even Take That used a tax avoidance scheme, even arguably innocently, to hide their £63million fortune.
Compare this with the “scrounger” who was paid £18,000 in benefits whilst working. Ms Redican had serious heart problems, but helped in a friend’s pub while being treated. She contacted Stoke on Trent City Council and said she wanted to return to work and was sent forms. She did not realise that her ad hoc shifts counted as employment so failed to declare them. She pleaded guilty as she accepted that, despite her confusion, the onus was on her to inform the benefits agency. She was given a 12-month community and super vision order, and ordered to pay £200 court costs and £60 surcharge. She is also paying back the money.
Let us hope the Government pays attention to the new report and stop demonising its citizens to hide the bigger picture.