Following our recent comments about public attitudes to tax evasion changing, we’ve recently seen a blog in the press about a plumber who has been jailed for tax evasion.

 

Ian Cowie of the Daily Telegraph reported that despite the public backlash against a comment by a Treasury minister that paying trades people in cash is ‘immoral’, HMRC is taking any and all attempts to avoid fair taxation very seriously.

The plumber in question set up his company but never registered with HMRC.  Over several years he evaded an estimated £50,000 of tax.  Confiscation procedures are in motion and HMRC have taken the unusual step of naming the plumber and publishing his photograph.

The assistant director of criminal investigations at HMRC said that the plumber “stole from UK taxpayers by failing to pay tax due on his earnings and now he must face the consequences of his actions in jail.  HMRC is clamping down on plumbers and those in other trades who attempt to commit tax evasion”.

Mike Wells, a director of risk and intelligence services at HMRC, said: “We want people targeted to come forward and use the opportunity to put the record straight and pay any tax due on the best possible terms. It really is better for people who owe tax to come to us, before we come and find you.”

New figures from HMRC show that tax receipts are rising faster than inflation.  Richard Mannion, national tax director at Smith & Williamson, the accountancy and investment management group, said, “Total receipts to HMRC for the 2011/12 tax year represent an increase of 4.3% compared with the year before, an increase from £447 billion to £466 billion.

“This increase is primarily due to a rise in the VAT rate from 17.5% to 20% in January 2011.  VAT now represents 21% of total tax receipts and brought in more than £98 billion.”

Many people, including Cabinet Ministers, do not believe there is anything wrong with paying tradesmen in cash, but the risks are high for those who are convicted of tax evasion.