Taxman fails to collect billions as benefits cut
As spending cuts hit households, a damning new report shows the government is failing to claim billions in tax.
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The government has failed to collect billions of pounds in tax at a time when its spending cuts are hitting many households hard, new figures show.
According to the Taxpayers' Alliance (TPA), a massive £27.4 billion has not been collected by the taxman in the last five years, equivalent to more than £1,000 per household.
In 2010/2011 alone, Her Majesty's Revenue and Customs (HMRC) missed out on £5.9 billion, the pressure group said. To put that into context, that sum would have made it possible to cut VAT by more than 1%.
TPA has claimed that errors on this scale could be avoided if the government simplified the tax code.
This lost revenue will be particularly galling to households who have been forced to sacrifice vital benefits as part of the government's austerity drive, aimed at bringing the burgeoning deficit under control.
In fact, it has been claimed that some households will lose an average of £10,000 by 2015.
Why isn't the money collected?
Massive amounts of tax revenue are not collected as a result of remissions and write-offs.
Remissions are debts that are capable of recovery but the HMRC has decided not to pursue the liability, for example, on the grounds of value for money or official error, explained TPA.
Meanwhile, write-offs are debts that are considered to be irrecoverable because there is no practical means of pursuing the liability, for example, if a firm has gone out of business.
The big increases in lost tax may in part be explained by recessionary pressures on individuals and businesses. However, a far simpler tax system could help to avoid errors of this scale in the future, and the public deficit could be reduced more quickly, argued TPA chief executive Matthew Elliott.
"It's ludicrous that our complex and unwieldy tax system means the taxman gives up on billions every year," he added.
"Taxes are a challenge to administer and a burden on families and we need systematic reform to produce a simpler tax code. Some of this uncollected tax will be down to the recession but there is clearly a long-term problem as well. Tax shouldn't be so taxing that even HMRC can't keep on top of it."
Do you find tax too complicated? Or do we just need the authorities to take a tighter grip on the money they're owed? Comment below to let us know your thoughts.
Big surprise there then-not.
Everyone knows the poor pay for the rich in this rat hole of a country and it will get worse under this bunch of corrupt malingerers
We all know who caused the crisis-investment bankers, stockbrokers, mortgage companies, who had an attitude of fcuk the world, profits rule.
What happened to them? Absolutely nothing, all the banks did after we bailed them out was up their fees and give £40 million in bonuses to their top executives.
And who do we find gets blamed for this?
Public sector workers, unions, people on benefits.
When you find a country voting against its own interests then you have to wonder where it will all end.
NO JOBS = NO TAX (SIMPLES)
HOW MUCH IS GOING OUT TO IMMIGRANTS FAMILIES
HAVE YOU STOPPED PAYING CHILD BENEFIT TO POLISH CHILDREN WHO HAVE NEVER BEEN TO BRITAIN ? (NO) NO WONDER THE NATIONS BANKRUPT
I owe the taxman about 2 grand, (self employed construction industry),
52 years old non stop bloody work, until two years ago when the powers that be destroyed my job (and millions like me), still as long as the bankers have there jobs and bonuses that's all that matters, me and the wife get £105 per week to live on so they wont be getting the money any time soon ? will they
We are a small business!! and a couple of weeks ago we received a letter saying it has come to our notice that we had underpaid our tax by £1 the letter would have cost more to send! so instead of targeting small businesses target all the fat cats out there who try to avoid paying tax. I have sent the £1 I wouldn't want HMRC to fold.
Sack Dave Hartnett at H.M.R.C.
And imprison him for bribery and corruption.
(Why is a man who steals mineral water in the riots imprisoned for 6 months when Mr Hartnett seemingly writes off BILLIONS?)
He is regularly 'schmoozed' by anyone with enough money to take him out for dinner,opera tickets etc.
He is also the man responsible for doing a back room deal(without consulting anyone in H.M.R.C) allowing Vodaphone to avoid their now infamous 6 billion tax bill.
P.S WHO are the sad,pathetic individuals who mark down peoples comments on these pages?
They aren't even collecting on £5.2 billion a year or losing another 1% VAT saving for us all. Join 38 Degrees make a difference.
MP's are 'Yes Minister' clones and the Civil Service is over populated by people dumber than a box of rocks! Losing taxes? ... the fools are missing out on even more because they stop us producing.
We need a Recall Law for MPs to make them honest and accountable and we need 'Go anywhere' Peoples Committees to go through the civil service and clear out all the fools and dead legs that are ruining this country. DECC/Gemserv/MCS losing us millions in an RE industry growing at 1000% a year despite the recession. Justice is dead in this country because the HMCS is a complete joke, apart from judges who send war hero's like 85 yr old Norman Scarth to jail because he made a stand against their illegal activities. They are legally killing this guy by withholding his meds right now.
I wrote to my Cons MP Laura Sandys asking about the 98% foreign owned Takeaways who take orders over the phone and collect cash on delivery. I worked for one briefly and he was taking £1000 a week. 100,000 take aways x £1000 = £5.2 Billion!!!! She hasn't answered that question.
Nth London Polish builder made himself a millionaire because he learned English then filled a room with 10 people at £75 a time to fill out Child Benefit forms for a service who said they would check later. (Unseen non domicile £1,200 first child, £800 second) He did that 8 times a day. Anyone think he paid tax on the cash in hand he received? 300,000 immigrants last year, 115,000 non EU, 20,000 Polish mothers gave birth. I live below one 2 kids and partner, don't work never put a penny in the pot. Can't state facts without been called a racist. Our government are racists against the British.
They wrote to tell me I owe them £1.60. Wonder how much it cost them in admin to tell me that.... Bet the stupid bureaucratic system won't remiss/write off my £1.60 but some person somewhere owing thousands will get off from paying it!
They also had the cheek to say 'sorry they had sent the bill late but they'd been busy.' Wonder what response I'd get if I said 'sorry I won't be paying it for a while as I'm busy!'
People fail to see basic economics made complicated by politicians, therefore people need to understand politics and ideologies that will help change the country.
For as long as we live under a liberal/labour/conservative rule, then nothing will change.
What do the stupid idiots running this country expect when they're the ones that axed thousands of HMRC jobs due to cutbacks and expect it still to run smoothly .
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A new study suggests a typical financial emergency costs around £1,200 - would you be able to raise that kind of money within a month?
Thanks for being one of the first people to vote. Results will be available soon. Check for results
- Yes - from my savings
- Yes - I could put it on credit
- Yes - I could borrow from family or friends
- No - raising that kind of money in a month would be impossible