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2,250 inspectors lined up in HMRC crackdown

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19th Sep 2011
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HM Treasury will continue in its fight against tax avoidance by the UK's wealthiest people with the recruitment of an additional 2,250 tax inspectors.

Speaking at the Liberal Democrats annual conference in Birmingham, Danny Alexander, chief secretary to the Treasury, confirmed that the additional HMRC staff will move into new anti-evasion and avoidance jobs targeting around 350,000 taxpayers.

More than 1,000 of these new HMRC roles are being advertised this month.

Mr Alexander said: "These [350,000 wealthiest taxpayers] are the people who pay or should pay the 50p rate of tax. And my message to the small minority who don’t pay what they owe is simple, I agree with the Chancellor. 'We will find you and your money' and you will pay your fair share.”

Alexander also said that this package was already bearing fruit: “I promised you we’d collect an extra £7bn a year by the end of the Parliament; and I can tell you we're already on track to raise £2bn this year.”

The Lib Dems have also vowed to put an income tax threshold of £12,500 "on the front page of its next manifesto" up from £10,000.

"Some people have argued that we should change our tax priorities and focus our limited resources on cutting taxes for the wealthiest instead," said Alexander. "At a time of austerity, this argument simply beggars belief. If we are all in this together, those with the broadest shoulders must bear the greatest burden.

"Fair taxation of the wealthiest is key to our deficit reduction plan. Of course, if a better way can be found to raise the money from this group, I will be willing to consider it. But right now we must focus relentlessly on those who are struggling. And we need to make sure tax owed is tax paid."

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By Hearts007
19th Sep 2011 15:41

HM Treasury will continue in its fight against tax avoidance by the UK's wealthiest people with the recruitment of an additional 2,250 tax inspectors.

Did they not make 10 times that number of IR staff unemployed.

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By ireallyshouldknowthisbut
19th Sep 2011 16:05

Is it just me to be bemused as to what a tax avoidance job would be within HMRC.

I thought that was my job. Their job is tracking evasion within the law, not what they might like the law to be. That's Osbournes job.

It would be nice if everyone was clear about their respective roles.

 

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By Exector
19th Sep 2011 17:30

See Saw Marjory Daw

@ Hearts007

 

Absolutely. They've been shedding jobs heavily ever since the IR merger with C&E in 2005 as this and property savings were the main drivers. Even more risible is the advert that has just appeared on the HMRC  Home page recruiting 200 trainee graduate tax inspectors less than 24 months after getting rid of a huge tranche of their most experienced Inspectors in an early retirement scheme to get the numbers down overnight!!

 

To add another of my Granny's many sayings (she was a smart cookie, my Granny) - Penny wise, pound foolish.

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By Sherlock
19th Sep 2011 18:17

HMRC Secret Police

The mind boggles! One envisages 2,250 HMRC Secret Police dressed in shiny long black coats and trilbies. Like the KGB and East German Stasi, they will be fully armed, but with copies of the Taxes Acts with which they will knock their hapless victims senseless.

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By Monty Python
19th Sep 2011 18:47

-

So they are targetting Britain's wealthiest people who don't pay what they should?

That will have Tony Blair in a panic then.

 

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By jay brown
19th Sep 2011 20:45

To much inteligence not enough savy!!

Im not the sharpest tool in the box as you will see from this poorly written note!! But it seems like comon sense to me that the country has the inteligent running it where in fact the inteligent should be doing the work leaving people with half ounce of savy to run things! EXAMPLE

I was happy to pay tax as i except it, im a proud brit but after iraq, afganistan, the politicians steeling, bailing the banks out now the riots that caused my family and freinds to live in fear have proved the police are powerless. i now dont want to pay a penny and feel like off setting as much as poss and not working so hard because i have no interest in giving nearly half my hard earned money to the soapy so called intelects running the country to waste!! So to spend more of our money 2250 new imployees to catch out workers instead of saving money and reassuring that there will be no more waste we may get back to feeling proud again??.   

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By ThornyIssues
20th Sep 2011 13:59

Oh dear, oh dear

Yet again we see conflation of avoidance and evasion. This needs to be knocked on the head right now.

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Replying to grinandbearit:
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By Mike Carter
20th Sep 2011 15:54

Interesting conversations

"I see you've paid into a pension plan. Did you know that by doing that you are avoiding paying tax"

"Yes, I did know that. Thanks for the information."

"We don't like people who avoid paying tax. What we'd like you to do is to not pay into your pension and take more salary instead"

"Is it legal to pay into a pension plan?"

"Yes it is"

"I'm sorry you don't like it but I like paying into my pension plan."

"But, that's not fair!"

"Sorry, someone on the other line...." <click>

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By johnjenkins
20th Sep 2011 14:45

I Like that!

Of our £7b for the length of this parliament we are "on track" (no we haven't quite got the money in yet but we know of several wealthy people who might wish to make a contribution) for our first £2b this year. Er what track would that be the "cuckoo trail" perhaps!

What planet are these people on if they think that 350000 of the wealthiest people are going to cough up £20k each. I suppose if knghthoods and the like are bandied about you might get a few.

So what are the government going to do with this £7b? Ah yes Greece needs a few bob, then Lybia needs looking after. oh and Cleggy will need another new PR makeover. So it looks as if Mr Clasper will be employing 2250 ex bagage handlers to go looking for all this dosh. Still they would have had plenty of experience in the search and find (well mostly) area. (no offence to terminal 5 workers)

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By nekillim
21st Sep 2011 11:33

First in Line

I would suggest they start with MPs, Lords, & Councillors first.

That should keep them quiet for ages!!!!!

Plug the hole in the bucket first, before chasing the people filling the bucket up!!!!

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By User deleted
21st Sep 2011 13:12

First let's get their house in order

If HMRC are going to recruit and train (now what a good idea that will be) 2250 staff to pursue evaded tax, how about they train their existing staff to do the job that they are being paid for properly - such as answering letters, not only in less than six months (if at all) but intelligently instead of incorrectly; aggressively or rudely (and frequently all three).  Perhaps they could also train those existing staff to answer the phone and, when they do to be able to provide answers to the questions asked and sort out the muddles that they have largely created.  When that has been done and the ordinary taxpaying public (not customers who have a choice about where they do business!) are paying the right amount of tax then resources could be spared to go after the evaders but let's not ignore the vast majority who are getting a really bad service from HMRC.  Perhaps HMRC might also consider why it is necessary for five different envelopes all containing some part of an overall set of paperwork relating to just one tax payer and five sets of postage when one envelope and postage charge would have sufficed (and been a good deal less frustrating for the recipient having to deal with the case piecemeal as each bit arrived over the period of a week!)

And I agree, how about prosecuting all the MP's who defrauded the system and restore respect for the honest ones - that might give society a real boost and restore some sense of morality

 

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By steve2646
21st Sep 2011 13:53

This makes a lot of sense

Only last year HMRC paid me and thousands of my colleagues off with the pretence of saving money.  In a bad year working mainly on my own I would be dissapointed if I brought in any less than £500k and would bring in considerably more in a good year (this excludes the deterant value of my job and yield during subsequent years).  I now receive half of my final salary as a pension for doing nothing.  It cost the Inland Revenue and HMRC a considerable amount of money to train me and assuming they are not trying to get the job done on the cheap it will take years before these new inspectors are sufficiently trained to do the job.

Is it any wonder HMRC and the government is in such a mess.  

 

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Replying to Flying Scotsman:
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By frustratedwithhmrc
21st Sep 2011 14:09

Let us risk the assumption

steve2646 wrote:

assuming they are not trying to get the job done on the cheap

Given the experience of the current HMRC management (the matter of Dame Strathie's health or departure aside), you can be almost certain that they will be trying to get the job done on the cheap. As the old adage goes, you've got "Time, Cost and Quality", pick the one you don't want.

My own suspicion, give said previous experience is that they will bring in low grade clerical staff, put them through an in-house programme which covers the fundamentals, probably lasting only 4-6 weeks and then throw them out into the field.

The reason I think this is that the current management seems to be on their last warning and need to do something bold and quick to turn things around. Inhouse incompetence and shabby 'customer' service might be ignored if they can show their political masters that they can bring in a reasonable amount of additional tax through such measures.

However, they are going to be stuffed either way. If they turn these poorly trained staff on the the highest earning 350,000 taxpayers as has been suggested, they might get lucky and score a few points, but it is probably more likely that their professional advisers will run rings around them.

It would make much more sense to bring experienced inspectors back into the fold as these could act as supervisors / mentors to the new folks, but also more specifically target there enquiries and deal with intransigent taxpayers and their professional advisors.

Maybe Steve (above) should send in his CV....?
 

 

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By The Black Knight
21st Sep 2011 14:13

Fortunately

Their audience is as daft as they are.........Politics

I would say there is a lot more than £7B out there in evasion.

Never mind the government created avoidance.

it's not quantity they need but quality and some that actually give a ....... about anything other than their pension.

For Danny the equation is:

low tax + less government = more private sector and more wealth, employment, and Tax

50% of nothing is = .............

10% of lots is = ...................

We could pay you to stay at home so you don't loose out, if this is the road block.

Perhaps we could pay expenses for MP's not to travel to work.

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By youngloch
21st Sep 2011 14:23

Perhaps they should recruit us!?!

I saw the HMRC advert on their website on Monday:

Never a dull day.
200+ graduate tax professional roles.

Ongoing training & support every step of the way.Apply online

 

and my first thought was "who visits the HMRC website more than anyone else?"

my second thought "are they talking to me?"

The small print specifically states that they are not interested in your age.

Sure enough there was guidance about how the applicants would be trained and the salary levels. 22 days holiday to start plus bank holidays, sports and recreational facilities in some offices, interest free loans!

It sounds really appealing (and more so the closer we get to January!) but, in what would be the equivalent of Alex Ferguson taking over at Man City, I think we'll stay put for now!

 

The main thing I read though is that it is a four year intensive programme, and I'm sure that to some extent very interesting for those eager recruits, but for all the fuss that they are going to crack down on the rich, in practice, it is years away isnt it?

 

It's a nice headline for the Lib Dems but, in reality, I can't see it going too much further too soon?

The only worry is will they train up these new recruits by letting them practice on the smaller taxpayers first?

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By The Black Knight
21st Sep 2011 14:25

Civil service mentality

Steve above was making a healthy profit ! So they got rid of him.......go figure.

Seems to be how it works, HMRC might actually be trying to sink the ship themselves !!

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By youngloch
21st Sep 2011 16:40

Just done the sums.....

HMRC Website - "200+ graduate Tax Professional Roles"

Lib Dems Headline "2250 Inspectors Lined up in HMRC Crackdown"

 

Where did the other 2050 go, there again they do say 200+......

I think they need to open an enquiry into their advertising or Mr Alexander needs to get a new keyboard - perhaps his number "2" is a bit sticky?

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Replying to mn2taxhbj:
By cfield
21st Sep 2011 15:07

You could have a million tax inspectors.......

You could have a million tax inspectors but it won't make any difference if the wealthiest people have fled these shores to live somewhere they don't have 50% tax, or have some other good reason for not paying it. At the end of the day, the courts will support whoever is on the right side of the law, whether HMRC and the LibDems like it or not. Employing more tax inspectors won't change that. It would make more sense if they could make better use of the resources they've already got.

Like the 50% tax rate itself, this announcement is purely political. It's sole purpose is to make people envious of anyone who earns more than them and turn that envy into votes. They fully understand that the 50% rate raises no extra tax revenue - it's just the votes they are interested in.

Chris

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By ireallyshouldknowthisbut
21st Sep 2011 18:39

As steve says, experienced tax inspectors bring in the cash. I cant believe how few inspections are actually carried out, the deterrent effect is very real.  You certainly know when you are speaking to one who is good, and you know when you are speaking to an untrained muppet who seem to be the front line these days on compliance checks.

When a risk taking client asks "so how many returns are picked a year?" and you say "well we get one or two - for the whole practice" many are happy to push the boundaries on judgement calls on the basis they know they will be very unlucky to get picked. Even if they are only saving £500 that's a lot of tax over all the other people making similar judgement calls.  If they knew they would get looked at every 5-10 years, completely different story. Same goes for how practices operate - we would have to be a lot sharper about what goes into the books.

 

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By johnjenkins
22nd Sep 2011 09:53

I was

privileged to be invited to many seminars when SA came into being (one of HMRC's better ideas)

At that time the investigation target was 4% of all tax payers with actual being under 2%. The new target was to be 2% computer random, 4% normal and 2% risk assessment. Certainly to start with there were quite a few aspect enquiries and PAYE visits (trying to re-catorgorise the self employed). However only 1 full blown investigation. I delvered all the records to HMRC beginning of february and have not heard a word since.

When I was training in the sixties, if the tax man came knocking you knew they had some sort of concrete information. These days there are too many fishing expeditions to make an investigation a deterrent.

It would be interesting to get Steve's views on investigations (percentage wise) he thought was

actually being completed.

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By WhichTyler
22nd Sep 2011 13:15

In fact not recruiting at all

The 2250 inspectors are being transferred from other areas to am 'Affluent' unit. See here:

http://blogs.ft.com/westminster/2011/09/the-truth-about-danny-alexanders...

So will this mean less pressure on less affluent clients?

 

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By johnjenkins
22nd Sep 2011 14:36

Less pressure

on the less affluent client is what we have been advocating for. However I can't see it happening.

You'll probably find a big surge against the wealthy with an even bigger realisation that HMRC have bitten off more than they can chew and then an almighty attack on the less affluent to make up for what they didn't get from the wealthy.

More or less what the banks did when they lost money in the last two recessions.

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