HMRC this week beefed up its risk-based anti-evasion strategy with five new taskforces, including one targeting scrap metal dealers in Scotland.
As the results of HMRC’s restaurant crackdown has shown, targeting areas where the risk of evasion is high is proving to be fruitful for the tax department. Investigations into 531 outlets has identified £634,000 in potential unpaid tax. The restaurant sweep fingered 222 businesses north of the border, and one of the new taskforces will specifically focus on fast food outlets in Scotland thought to be mis-declaring their true sales levels.
- The other targeted sectors include:
- Construction firms and self employed builders suspected of suppress sales figures or over-claiming expenses in the North West and North Wales
- Taxpayers not submitting their statutory returns across Corporation Tax, Income tax Self Assessment, PAYE and VAT in the South East
- Landlords owning or renting three or more properties in the North West and North Wales who may be evading their tax responsibilities.
But the headline-grabbing announcement will be the taskforce devoted to tackling evasion among scrap metal dealers in Scotland. The rising price of copper during 2011 has fuelled a spate of rail cable thefts, causing widespread disruption for travellers and calls for greater regulation of the scrap metal industry, including one from AccountingWEB member DMGbus in May.
While HMRC has not introduced any new paperwork or procedures to regulate the industry, paying closer attention to its record-keeping revives the Al Capone strategy of harassing and deterring criminals through tax compliance measures. Why Scottish scrap metal dealers alone are being targeted at this point is not clear.
David Gauke, the Exchequer Secretary, said that the taskforces are a direct result of the government’s £917m spending review re-investment to tackle tax evasion, avoidance and fraud, which aims to raise an additional £7bn each year by 2014/15. The five new teams are part of the 12 planned for 2011/12, and more will follow next year, HMRC said.
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