VAT amnesty raises £26m
A temporary VAT amnesty offered by Customs & Excise last year raised £26m in revenue and led to 3,900 traders operating in the shadow economy registering, according to a National Audit Office report released today.
Link: £12bn in VAT escapes taxman
The ‘one-off incentive scheme’ which ran from April to September 2003 was launched to provide businesses a chance to come forward without incurring a penalty.
The NAO also recommended that Customs should ‘disseminate the lessons learned to help other departments assess the value of similar schemes’.
The Inland Revenue has long been considering the possibilities of a temporary amnesty.
Customs reduced the amount of VAT missing trader fraud by between £110m and £120m, according to the report. Despite this, the overall VAT losses from fraud and error increased to £11.9bn in 2002/2003 from £10.6bn the previous year.