A TAX EVASION HOTLINE run by HM Revenue & Customs received around 72,000 calls last year, according to tax and accounting information group Bloomsbury Professional.
The high volume of calls – around 300 per day – reflects increased public concerns over tax evasion, Bloomsbury said, although it warned that the number of calls does not necessarily lead to increased yields.
In many cases, the calls can lead to unnecessary investigations. A case in point is 2006/07, when HMRC recouped just £2.6m from calls made to the hotline, rather than the £32.5m originally hoped for.
Typically, the calls relate to small-scale cases such as tradesmen being paid cash-in-hand, rather than more elaborate, offshore activities.
HMRC did not reveal how many of their investigations conducted as a result of calls had proven successful in their response to Bloomsbury’s Freedom of Information request, but managing director Martin Casimir believes it is likely to be low.
He said: “The sheer volume of calls to the hotline is astounding. People are clearly keen to ensure that no-one cheats the tax system and that everybody pay their fair share of tax. HMRC is already on a stretched budget.”
Casimir also questioned whether HMRC has the manpower to deal with all the complaints that it receives.
“HMRC should be concerned about how few calls actually reveal a tax evasion case of note. Whilst people are now more sensitive to the possibilities of any tax irregularities, it can lead to people being over-keen and making calls that are misguided.”
A spokesperson for HMRC said: “The vast majority of customers pay the tax they owe, but where people have information that someone might not be playing by the rules, the confidential hotline gives the public an opportunity to tell HMRC about it. All information received through the hotline is assessed and a decision made on the most appropriate course of action.”
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